US & Global Economic Impact Analysis and Forecasts

Freedonia analysts and economists are sharing their insights on how major events are impacting different parts of the US and global economies.

US Bus Operators Struggle With Pandemic-Related Operational Restrictions & Reduced Traveling; Federal Bailouts Requested but Pending

The American Bus Association (ABA), which represents US motor coach operators, private school bus operators, and other industry participants, began to raise concerns about the viability of the US motor coach industry as early as May 2020. The ABA asked the Trump administration to include the motor coach industry in the COVID-19 aid package, arguing it was an essential pillar of the US transportation sector.

In mid-2020, Senators Susan Collins and Jack Reed – with the support of the ABA – introduced a bill that would provide a $10 billion aid package as well as $5 billion in loans to bus operators and passenger boat transportation companies. The Coronavirus Economic Relief for Transportation Services bill is based on the airline bailout, and a similar bill was introduced in the House of Representatives.

The ABA argues that without this bill, up to 40% of private bus companies could go out of business by the end of 2020 because of the dramatic drop in demand for their services related to the COVID-19 pandemic. It estimates that 308,000 employees in the industry have been furloughed in 2020. Turmoil in the industry will also have a major impact on domestic bus manufacturers, causing them to lay off workers, adjust supply chains, and delay investments.

The drop in tourism activity, restrictions on the movement of people, and closures of schools and businesses have had a profound impact on the use of private motor coach and school bus services. According to some estimates, the motor coach industry is expected to record revenues of about $4 billion in 2020, compared to the $15 billion it typically makes per year. Money from the bailout package could be used to buy new buses, fix existing models, and service debts.

As of yet, the CERTS bill has not been adopted and the ABA continues to push for movement on the bill. Currently, there is significant bipartisan debate among US lawmakers, and passage seems more likely with the re-election. Both motor coach and school bus operators are essential for the transportation systems of many US cities, and this will put pressure on the government to offer an aid package.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research, including Global Buses, Global Diesel Engines, Recreational Vehicles, and Travel Services: United States. Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Automotive & Transport      Covid-19