By Yang Zhongyang
In the 2012 China Beijing International Exhibition on Buses, Trucks, and Components, besides mainstream Chinese bus manufacturers such as Yutong and Golden Dragon, many foreign exhibitors, including America's Navistar and Blue Bird, also made their presence, exhibiting two classic school bus models of the IC brand.
Meanwhile, on the 63rd China Educational Equipments Exhibition held in Changchun, FAW Bus and Coach officially introduced 3 school bus models, including the 9-meter long-headed school bus, 7.5-meter long-headed school bus, and 7-meter flat-headed school bus, becoming a major highlight of the exhibition.
Previously, on the Auto China 2012, Dongfeng Commercial Vehicles, which has always focused on medium- to heavy-loaded trucks, also introduced the company's newly developed EQ6600S4D long-headed school bus, intending launch a new offensive in this segmented field.
Why are Chinese and foreign vehicle companies striving for superiority in the school bus market? Gao Hesheng, deputy director of China Automotive Technology & Research Center, suggests that currently in China there are 90 million students and children who need to ride the school bus. The market capacity of professional school bus will exceed 1 million units, with an annual updated demand of 150,000 units. At the medium price of RMB 300,000 per unit, the 1 million school buses will value at RMB 300 billion Yuan, which would make the market volume not lower than RMB 400 billion Yuan with maintenance and other costs. This is a huge cake for school bus manufacturing and operating companies.
In fact, against the background of negative growth of automobile sales in China, sales of school bus amounted to 6,489 units in the first quarter of this year, equivalent to the total sales of last year and an increase of 580 percent compared with the same period of last year.
"We can see from the global school bus market that North America is the only real school bus market. Presently, there are 480,000 school buses in the USA, with an updated quantity of approximately 25,000 units every year. But this market is very mature and stable now. There has been no revolutionary change or improvement in school bus technology for the last few years, only some graduate update and improvement on the rather mature basis", said Lu Xin, managing director of Navistar China. Lu Xin suggests that the Chinese market has just started to develop normally, and the market volume may reach 35,000 to 50,000 units every year in the next three to five years.
Jiang Litang, deputy managing director of FAW Bus and Coach, suggests that there are 180 million students in China now. With a capacity of 20 to 30 seats each bus, about 500,000 to 800,000 school buses are needed, and the minimum annual market volume is 50,000 units.
Huang Gang, managing director of Dongfeng Commercial Vehicle, tells reporter that with such market knowledge in mind, Dongfeng Commercial Vehicle Company has completed adjustment of its bus and coach sector. The company will start to get established in the market centering on school bus, minibus, and other products.
In spite of the huge market demands for school bus in China and its temptingly huge market volume, most industrial participants believe that the school bus market in China is still not mature at present. There are too many uncertainties, and explosive growth is not very likely within near future. The development may be achieved gradually in 10 to 20 years.
Jiang Litang believes that three major bottlenecks need to be broken before the golden development phase can be ushered into the school bus market. First, funding must be appropriate. In the first quarter of this year, sales of school bus in Guangdong and Henan have been very good, and it has much to do with proper funding in a timely manner. "In visiting our clients, we discovered that they were still waiting for funding. The policies have not been implemented".
Second, many bus and coach systems are not willing to undertake school bus operation, mainly because they think that the responsibility is huge but the profit is low.
The third is responsibility. Government departments, including education, public security, and transportation, all have the responsibility, particularly the heads of schools. "In our visit, school headmasters say that they can be responsible for the students during the 8 hours the students are in school, but it's too stressful for them to take responsibility after the 8 hours. As heads of schools, they wouldn't buy the bus if they are not forced to. They are not willing to shoulder the responsibility".
"If government departments and society continue to promote construction of school bus-related systems and formulate regulations and standards clearly specifying who will pay the cost and undertake the operation, it's possible that the school bus market in China would reach 70,000 to 100,000 units every year", said Lu Xin, "When the market is mature, even without significant increment, the updated volume alone is considerable".
Lu Xin believes that: as new laws are promulgated, supporting measures continue to improve, and manufacturers have deeper understanding of the school bus products market, the technology level and quality of products on the market will also be improved steadily, the whole market will gradually get onto the track of normalized and rapid development, and China's school bus market will become the largest market in the world, as its passenger car market and commercial vehicle market do.
