Thanks to compiling data for School Bus Fleet's 2025 Fact Book, I got to collect and crunch a whole lot of numbers. And sure, school bus sales dipped a bit in 2024, but this year’s 2% decline feels more like a speed bump than a wrong turn. If you single out the U.S., it looks even better, with just a 0.1% blip.
Two years ago, 2022 saw the first sales rebound since COVID, with impressive 33% YOY growth across North America and a more modest 2% growth in 2023. But we’re not worried about a downward trend. It will take more time to return to the glory days of 2019.
After all, signs still point to a recovering market.
One market intelligence firm predicts that the North American school bus market will grow from $2.41B to $3.04B by 2029, growing at a CAGR of 4.8%; another projects it will expand at a CAGR of 13.4% through 2031.
When we focus on sales by type in 2024, we see the following breakdown:
Type A: 22%
Type C: 70%
Type D: 8%
Interestingly, Type As dropped the most in popularity, supplemented by growth in the Type C and D markets. Yet, Collins Bus reported the driver shortage has helped demand on their end, as districts seek non-CDL buses.
New Type C and D registrations are expected to grow to 35,000 by 2026 (with 33k in 2025, 29k for 2024, and a low of 24.5k in 2022, making a nice U chart).
IC Bus reports high demand for bus replacement, boosted by the infrastructure plan, but almost a year’s worth of backlog.
The supply chain delays, production backlog, and delivery time at OEMs may not be fully resolved but continue to ease. Finally, chassis availability has steadily increased.
One shared issue for manufacturers is cost and labor — just like districts need drivers, manufacturers need skilled workers to meet demand. Most OEMs now have union shops requiring higher labor costs. With no significant relief yet for steel prices and freight transfers, making a bus costs more than ever.
Adoption continues to rise for alternative fuels — Blue Bird delivered its 2,000th EV bus this year — and electric-exclusive manufacturers are gaining traction, too. According to World Resources Institute (WRI) data, over 1,500 operators have committed to adding 12,241 more ESBs in 49 states as of Oct. 1, 2024 (Wyoming is the outlier). Nearly 5,000 ESBs are on the road today, though more than 90% of full-size buses remain powered by diesel. The EPA’s Clean School Bus Program funded more than two-thirds of the former.
While there is immense opportunity here, not to mention record funding available, it begs the question of what happens if the program is cut or drastically changed. We know that the president-elect has talked of rolling back emissions standards, EV regulations for commercial vehicles, and consumer tax credits. It remains to be seen what will happen to their heavy-duty counterparts — and more importantly, how it will affect all of us.
One trend we can’t ignore is the overall decline in school bus ridership. For the 2023-24 school year, an average of just 50% of U.S. K-12 students rode the yellow bus — the lowest number we have seen in 10 years since SBF has tracked it. Typically, it hovers closer to the 53% to 55% mark. The Washington Post declared that “the school bus is disappearing” earlier this year, to most of our chagrin.
This is likely due to a combination of factors: spillover pandemic disruption trends that stuck, parents’ frustration over late buses and other issues as we fight through a driver shortage and budget cuts, and the increasing popularity of alternative transportation options.
The interesting thing about noting fewer kids are on the school bus is that special-needs ridership is rising. According to SBF’s 2024 Special Needs Survey, 59% of transportation directors saw an increase in passengers with special needs compared to the prior year (also up from the year before that). In 2023, respondents reported that 14% of their passengers had special needs; by 2024, it rose to 22%. What’s behind this shift? Watch our February issue as we explore this more!
So, some challenges are ahead. But also bright spots. If there’s one thing I’ve learned so far, it’s that this industry is resilient and supportive of each other. There is plenty of healthy growth rolling into the future. As always, we must remain flexible to tackle The Next Big Thing.
