Challenges ahead but industry survey shows cause for optimism

Sustainable Bus Transport

Coach and bus operators

Coach and bus operators have signalled some cautious optimism about their business prospects for 2023 in a survey carried out by trade publication, routeone, at the end of 2022.

The research among small, medium and large operators across the UK found that overall business confidence for 2023 is at the same level as it was two years ago, when the sector was dealing with the immediate fall-out from the pandemic. However, a different set of economically challenging circumstances has since polarised opinions, according to the survey.

Three quarters of respondents operate no more than 20 vehicles and in response to the key metric of business confidence, 45% of operators said they were either slightly optimistic (31%) or very optimistic (14%) about the year ahead. On the other hand, 22% said they were slightly pessimistic, whilst 11% were very pessimistic about the year ahead, with the remaining 22% taking a neutral position.

There was a correlation between fleet size and the extent of confidence. The findings revealed that the smallest operators with 1-5 vehicles had the lowest optimism rating, at 38%; just 8% were very optimistic and 30% slightly so. Among respondents with over 100 vehicles, 75% were optimistic, albeit only slightly. For those operators with 51-100 vehicles, overall optimism was 72%. For 21-50 vehicles the overall optimism score was 42%.

When confidence levels were further broken down into coach, bus and community transport, 22% of coach operator respondents said they were very optimistic, 27% were slightly optimistic. On the flip side, 5% remained very pessimistic and 24% were slightly pessimistic about 2023.

For bus operators, continued uncertainty around government funding support highlighted caution about their prospects for 2023. Only 8% of representatives in this sector were very optimistic, with a further 30% slightly so. 13% were very pessimistic and 23% slightly pessimistic. Among CTOs, 15% were very pessimistic and 7% were slightly so, whilst 11% are very positive about the year ahead and 41% being slightly optimistic.

The survey also included operator views about driver recruitment challenges, which appeared to weigh heavily on business sentiment. Only 17% of all respondents believed that availability of drivers will improve this year, although operators with over 100 vehicles are much more confident that the situation will improve.  Amongst smaller companies, almost 90% reported that they have had to turn down work due to a lack of drivers, which has prompted them to explore new ways of trying to attract and recruit them.

On the subject of business recovery, nearly half (46%) of respondents said that their business had either already returned to pre-pandemic levels or will do so in 2023. Of that figure, almost a quarter said their recovery was complete, 8% believed it will be within six months, and a further 15% within a year. Of the remaining respondents, 23% believed that recovery will occur within two years, 15% within three years and 16% more longer term.

Encouragingly, many operators plan to invest in new or used vehicles in 2023 and diesel is still by far the most popular driveline choice, with 74% expecting to buy a diesel vehicle. However, 15% of respondents indicated that battery-electric propulsion was a possible route, and 4% were looking at hydrogen fuel cell-electric. 6% were likely to be in the market for diesel-electric hybrid, whilst the remaining 1% were undecided at this point.

Commenting on the survey findings, John Dwight, Sales Director of Imperial Engineering, which supports bus and coach operators across the UK with OE parts, commented:

“This in-depth survey by our colleagues at routeone highlights both the resilience shown by operators during unprecedented times and also the challenges which confront the industry in 2023. Although optimism is in limited supply across the whole sector, it is still there and we need to harness this as we embark on another challenging year ahead. It’s also encouraging to see operators planning to make investments in new vehicles. As a major distributor of OE and remanufactured parts for operators of all sizes, Imperial Engineering has scaled up its operation from our brand new premises in Harlow and will continue to support customers in every way possible.”