School & Employee Bus Transportation

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 2,600 school and employee bus transportation services in the US contract with public school districts, private schools, parents, colleges and universities, airports, and private businesses to provide bus and shuttle services for students and workers. About one-third of the 13,600 public school districts in the US outsource student transportation services and that number is expected to grow.

Aging School Bus Fleets

Faced with tight budgets, school districts postpone replacing older buses in their fleet.

School Bus Driver Shortage

Many school districts and transportation contractors are having difficulty meeting demand for school bus drivers.

Industry size & Structure

The average school and employee bus transportation firm has 65 employees and generates about $4-5 million in annual revenue.

    • The school and employee bus transportation industry consists of about 2,600 companies employing over 171,000 workers and generating about $12.7 billion in revenue.
    • There are about 13,600 public school districts in the US, along with over 32,400 private schools, and 7,200 charter schools. Many school districts operate their own bus transportation services and about one-third outsource to transportation services firms.
    • There are about 476,000 school buses operating in the US transporting more than 23.2 million children to and from school and school-related activities. The average school bus carries 49 student passengers.
    • The average annual public expenditure to transport a student by bus is $850-900.
    • The industry consists of many small companies providing services to a local area - 63% of firms have less than 20 employees.
    • The 20 largest firms account for about 51% of industry revenue.
    • Large firms include First Student (part of FirstGroup, PLC), Durham School Services (part of National Express Group, PLC), Student Transportation of America, and North American Central School Bus.
                                  Industry Forecast
                                  School & Employee Bus Transportation Industry Growth
                                  Source: Vertical IQ and Inforum

                                  Recent Developments

                                  Nov 11, 2022 - School Districts Want Electric Busses
                                  • More than 95% of the first wave of $1 billion in US Environmental Protection Agency (EPA) funding for alternative-fuel school buses will go to electric buses, with relatively few dollars set aside for vehicles that run on low-emission fuels like propane or natural gas. The EPA almost doubled its funding for alternative-fuel school buses to close to $1 billion after school districts from all 50 states applied for rebates. The first round of funding from the Bipartisan Infrastructure Law passed in 2022 was supposed to free up $500 million but the EPA received about 2,000 applications, amounting to nearly $4 billion in requested funding. Another $1 billion round of funding for school buses will be made in the 2023 fiscal year, according to the EPA. The agency plans the next funding program, which will include a grant competition, to launch in the next few months.
                                  • The Inflation Reduction Act signed into law in August offers more funding for school bus electrification through a new Clean Heavy Duty Vehicles program. The program includes $1 billion for medium and heavy duty commercial electric vehicles, charging infrastructure, and related workforce training. Class 6 and 7 school buses are eligible. Non-profit school transportation associations, contractors, municipalities, states, and Indian tribes are eligible.
                                  • US school districts and fleet operators have committed to implementing 12,275 electric school buses (ESBs) across 38 states as of June 2022, according to the World Resources Institute (WRI). That’s six times more since the release of WRI’s January 2022 dataset and almost a 10-fold increase since the organization began tracking electric school bus adoption in mid-2022. WRI identified 60 new districts that have committed to electric school buses, bringing the total to 415 school districts, a 60% increase from its first count in August of 2021. WRI considers a school bus committed when a school district, bus dealer or fleet operator has either been awarded funding to purchase the vehicle or has made a formal agreement for a purchase with a manufacturer. Committed also includes buses that have been delivered and are in use.
                                  • Workplace occupancy, an indicator of demand for employee bus transportation service, was 47.5% for the seven-day period ending on November 9, up from 47.2% for the seven-day period ending on November 2, according to data gathered from swipes of access control cards in buildings with security systems provided by Kastle Systems. Occupancy reached 49% on October 12 after failing to break the 47.5% mark since at least August despite attempts by many organizations to bring employees back. The Austin, TX, metropolitan area had the highest occupancy for the seven-day period ending on November 9 at 62.2%. The San Jose, CA, metropolitan area trailed all others tracked at 37.5%.
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