Strategic Analysis of Global Bus Rapid Transit Systems Market

Strategic Analysis of Global Bus Rapid Transit Systems MarketMarket to Double Through Growth in Demand From New Regions and Advanced BRT Solutions Global NA5E-18 March 2012

Research Team Analyst AnalystBharani Lakshminarasimhan Ryan CarmichaelResearch Analyst, Automotive & Transportation Research Analyst, Automotive & Transportation +91 44 66814122 +1.416.490.1274 bharanil@frost.com ryan.carmichael@frost.com Program Director Strategic Review Committee LeaderSandeep Kar Sarwant SinghGlobal Director, Automotive & Transportation Partner, Automotive & Transportation +1.416.490.7796 +44 207 915 7843 sandeep.kar@frost.com sarwant.singh@frost.comN5AE-18 2

ContentsSection Slide NumbersExecutive Summary 6Research Methodology, Geographical Scope and Partial List of Companies Interviewed 20BRT Systems Market – Overview and Definition 26Bus Rapid Transit Systems – Global Best Practices Comparative Analysis 30 a. BRT Standard 32 b. BRT Bus Standard 33 c. BRT Bus Powertrain Standard 34 d. Global BRT Systems-Hot Spot Analysis 35 e. Comparative Analysis of Top 3 BRTs 37 f. Case Study-Guangzhou BRT 39Market & Technology Dynamics for BRT systems 41 a. Market Drivers and Restraints 42 b. Product Life Cycle Analysis of BRT Systems 47 c. Global BRT Vehicle Market—Value Chain Analysis 50N5AE-18 3

ContentsSection Slide Numbers Total Market Measurements 51 a. Global BRT Vehicle Unit Shipments Forecast 52 b. Global BRT Vehicle Powertrain Penetration Forecast 54 c. Global BRT Vehicle – Bus Length Configuration Forecast 56 d. Global BRT Vehicle OEM Unit Shipments Forecast- Region Wise 57 Bus Rapid Transit Systems Market– Regional Profiles 59 a. Latin America 60 b. China 68 c. India 75 d. Europe 84 e. North America 92 f. Rest of World 99 BRT Systems – Need Evaluation and Analysis 108 a. Mega Trends Influencing the BRT Market 109 b. Transit Solutions- Comparative Analysis 111N5AE-18 4

ContentsSection Slide Numbers BRT systems – Design, Development and Implementation process 114 a. BRT Evolution 115 b. BRT System Design and Implementation 116 c. Service Design 118 d. Operational Model 119 e. BRT Cost Structure 120 f. BRT Financing Models 121 g. Bus OEMs Value Proposition in BRT 122 h. Integrated Mobility 123 BRT Vehicle Analysis 125 Strategic Recommendations and Conclusion 133 a. Key Research Findings 134 b. Key Conclusions and Future Outlook 135 Appendix 137N5AE-18 5

Executive SummaryN8CF-18 6

Executive Summary—Key Findings Globally Over 100 BRT Lines are currently operational or under various stages of 1 implementation. This translates into enormous market potential for new vehicle purchase and replacement demand as well. 2 The global BRT vehicle market is set to reach over 7800 units by 2018. Latin America and China alone to account for over 58 per cent of the total market. Volvo to retain global leadership with over 30 per cent global market share by 2018. 3 Daimler emerging top competitor with 19 per cent share by 2018. 4 Diesel to remain dominant powertrain system over the forecast period. Alternative fuel powertrain penetration is set to triple and reach over 20 per cent by 2018. 5 By 2018 18-24m, low-floor, telematics enabled buses to feature in most BRT lines across the world. Source: Frost & Sullivan analysis.N5AE-18 7

Executive Summary—BRT Evolution : Informal Services to Full BRT – Bus Rapid Transit isNow Increasingly Being Viewed as a Viable and Effective Mode of Mass Transit in Urban Centersin Both Developed and Developing World Global BRT Systems Market : BRT Evolution (Global), 2011 Full BRT BRT Lite • Integrated Busways Routes • Segregated (Feeder Conventional bus ways routes • Pre-board fare connecting the Services central trunk • Segregated collection and verification line) Informal Bus Ways • Closed, high Services • On-Board Fare • On-Board • Higher Quality quality Collection fare Stations Stations • Poor Customer collection • Clean vehicle • Flexible Service • Standard Technology frequencies • Non Regulated • • • Often vehicles and Open BRT Variable Operators system with no services(All subsidized stations • Taxi Like cap on Stop and operations Services operators Express) Evolution of BRT Services Source: Frost & Sullivan analysis N5AE-18 8

Executive Summary—Global BRT Systems Hot Spot Analysis: GloballyOver 100 BRT Lines are Currently Operational or Under Different Stages of Implementation Global BRT Systems Market : Hot Spot Analysis (Global), 2011-2018 North America China-India Existing BRT with expansion plans New BRT systems in the Latin America planning phase Source: Frost & Sullivan analysis N5AE-18 9

Executive Summary—Voice of Customer Research for Overall PublicExperience in Relation to Transport ModeStrong Potential for BRTs in Many Major Urban Centers in Asia and Europe Journey Experience Index (JEI) tends to be higher among cities with a higher 1 Total share of individual transport 2 New York 100% Car 3 Seattle focused 4 Los Angeles 90% 15 cities 5 San Francisco 6 Mexico City Share Individual Transport 4 80% 21 7 Rio de Janeiro 13 3 8 Copenhagen 70% 9 London 24 23 10 Paris 20 60% 11 11 Frankfurt 5 17 12 Moscow 1 14 50% 2 13 Dubai 16 6 Public transport 14 Cairo 8 focused cities 40% 22 15 Johannesburg 18 10 16 Beijing 7 30% 9 12 17 Shanghai 19 18 Seoul 20% 19 Tokyo 0% 10% 20% 30% 40% 50% 20 New Delhi 21 Kuala Lumpur Share Public Transport n=7,185; Q7: Mode of transport used, Q34: Indexed (Bubble Size = JEI (Journey Experience Index)) 22 Singapore 23 Jakarta JEI for car focused cities is higher than public transport focused cities 24 Sydney N5AE-18 10

Executive Summary—Voice of Customer Research For BRT as a SolutionOvercrowding, Traffic and Speed Cited as 3 Most Frustrating Aspects of PublicTransit 1 out of 2 individual and 2 of 3 public transport users are frustrated with the traffic situation. But differences exist by region: In Americas a significant lower individual transport frustration level can be seen, whereas in APAC the difference between the two modes is the smallest. Frustration by mode is for both primarily caused by one reason: traffic congestions in individual and overcrowding in public transport Reasons for Frustration Reasons for Frustration Individual Transport Public Transport Overcrowding Traffic Speed Other No frustrations Traffic Speed Other No frustrations 13% 14% 12% 14% 14% 11% 11% 11% 4% 12% 9% 13% 10% 12% 11% 4% 9% 4% 13% 3% 42% 32% 30% 31% 29% 37% 22% 24% 32% 26% 42% 37% 37% 53% 56% 65% Total Americas EMEA APAC Total Americas EMEA APAC Q28: What,, if anything, was the most frustrating or annoying part of this trip? Concerns over overcrowding, traffic and speed in urban transportation could be overcome by an efficient BRT system. N5AE-18 11

Executive Summary—Comparison with Other Transit SolutionsBRT Emerging as a Sustainable Compared to Light Rail and Conventional Bus Global BRT Systems Market : Transit Solutions- Comparative Analysis(Global), 2011 Light Rail BRT Conventional Bus Efficiency - [5], [4.5], [3] 5Ratings : [Light Rail], [BRT], [Conventional Bus] 4 Route Flexibility [1], [4], [5] 3 Capital Expenditure [1], [4.5], [5] 2 1 Environmental Footprint 0 Network (Distance) [5], [4], [2] [2], [4], [5] Passenger Information System [5], [4.5], [2] Flexible Frequency [5], [5], [2] Total Ratings: Light Rail – 34 Off Vehicle Fare Collection Journey experience BRT – 39 [5], [4.5], [2] [5], [4.5], [2] Conventional Bus - 29 Note: All figures are rounded; the base year is 2011. Source: Frost & Sullivan analysis N5AE-18 12

Executive Summary—Integrated MobilityThe 10,000 to 15,000 pphpd Capacity that BRT provides Can Bridge the Gap Between HighCapacity Upstream Urban Rail Systems and Low Capacity Downstream Transportation Options • Subways and heavy metro systems are Urban available in city centers in urban areas.Transportation Urban • Operating capacities of 70,000-120,000 Puzzle Rail pphpd. Ideal capacity of 10,000- BRT 15,000 pphpd to bridge the Conventional gap. Bus Systems Car Sharing Bike Sharing • Conventional buses can handle capacities in the range of 3,000 to 5,000 pphpd. Bicycle • Car sharing, bike sharing and other non-motorized transportation Walking options emerge critical in delivering the last mile connectivity. Passenger Per Hour Per Direction (pphpd) Source: Frost & Sullivan analysis N5AE-18 13

Executive Summary—Global BRT Vehicle Unit Shipments ForecastLatin America and China Alone Absorbed Over 3 Thousand BRT Vehicles in 2011; Indian,North American and European Markets Growing at a Fast Pace Global BRT Systems Market: Unit Shipment Forecast- Region Wise (Global), 2011 and 2018 Europe 800 North America 600 600 400 CAGR 2000 China 200 17.8 % 1500 400 CAGR 1000 CAGR 0 200 2011 2018Unit Shipments 500 17 % 5.8 % 0 0 2011 2018 2011 2018 1500 India CAGR 1000 Latin America 22.1 % 4000 500 3000 Rest of World CAGR 0 1500 2000 2011 2018 6.9 % 1000 1000 0 CAGR 500 2011 2018 5.6 % 0 2011 2018 Base Year, End Year Note: All figures are rounded; the base year is 2011. Source: Frost & Sullivan analysis N5AE-18 14

Executive Summary—Global BRT Powertrain Penetration ForecastDiesel to Remain Dominant Propulsion Fuel Over the Forecast Period Albeit With ShrinkingDemand as Alternative Fuel Powered BRTs Gain Rapid Proliferation Global BRT Systems Market: Unit Shipments- Powertrain Mix (Global), 2011 and 2018 Altenate Fuel Diesel 4,000 2018 Regional Shares 7,874 3,000 14.9 % 4,341 20.4 %6.8 % 2,000 85.1 % 26.0 % 8.0 % 79.6 % 1,000 13.0 % 93.2 % 74.0 % 92.0% 35.3 % 87.0 % 59.5 % 40.5 % 64.7 % 0 Latin North Europe China India Rest of America America World 2011 2018• Market for advanced powertarin technologies is expected to increase across the forecast period as concerns over energy security and climate change emerge as key driving factors.• North America, Europe and China emergeing as key growth markets for advanced powertrain technologies. Note: All figures are rounded; the base year is 2011. Source: Frost & Sullivan analysis N5AE-18 15

BRT Bus Built Analysis-Length Configuration: Mapping Bus Configurations withService Design is Critical; Long Articulated Buses Have Greater Acceptance in Trunk ServiceCompared to Direct Service Length Configuration BRT Applicability Direct Service Trunk Service Standard 12m 12 m Articulated 18 m Bi-articulated 24 m High Low Source: Frost & Sullivan analysis N5AE-18 16

BRT Standard: Segregated Bus Ways with Level Boarding Stations Considered Best Fit forEfficient BRT Operations; Migration of Operation Model in China and India Towards ClosedSystem Compelling Bus OEMs to Focus on Product Competitiveness Combination Global BRT Systems Market : BRT Standard Overview (Global), 2011-2018 Operations Level Boarding Open Segregated Feeder Service Trunk and Operation Closed Non Level Boarding Partially Segregated Direct Service Operations Public Service Design Operational Model Bus ways Station Interface Strong Trend Towards 2018 Moderate Trend Towards 2018 Source: Frost & Sullivan analysis N5AE-18 17

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Strategic Analysis of Global Bus Rapid Transit Systems Market

by Frost & Sullivan on Jun 22, 2012

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