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 2,500 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 fewer than 45 employees and generates about $4.5 million in annual revenue.

    • The school and employee bus transportation industry consists of about 2,500 companies employing 176,000 workers and generating about $11.3 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 more than 480,000 school buses operating in the US transporting an estimated 26 million students 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 almost $1,200.
    • 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

                                  Jan 5, 2024 - Strong Sales Growth Expected
                                  • School and employee bus transportation industry sales are forecast to increase at a 9.72% compounded annual rate from 2022 to 2027, faster than the growth of the overall economy, according to Inforum and the Interindustry Economic Research Fund, Inc. Industry employment remained below pre-pandemic levels during 2023 while average wages for nonsupervisory employees increased moderately.
                                  • Vans are becoming more popular for student transportation, according to School Transportation News, but experts caution that the vehicles still aren’t safer than school buses and shouldn’t be used merely to address school bus driver shortages. School districts facing challenges ranging from serving an increasing number of students with special needs to coping with driver shortages are increasingly using vans and other smaller vehicles. Their more manageable size, less stringent driver qualifications, and other features offer greater flexibility in transporting students. Jason Saunders, chief asset management officer for contractor Beacon Mobility, notes that the supply of larger school buses hasn't kept up with post-COVID demand for new units and the availability of Commercial-Drivers-License-permitted drivers is decreasing.
                                  • 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.
                                  • Workplace occupancy, an indicator of demand for employee bus transportation service, was 51.1% or the seven-day period ending on December 13, down from 51.6% for the seven-day period ending on December 6, according to data gathered from swipes of access control cards in buildings with security systems provided by Kastle Systems. Occupancy has rarely hit the 50% mark since the early days of the coronavirus pandemic 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 December 13 at 63.3%. The San Jose, CA, metropolitan area trailed all others tracked at 41.2%.
                                  Get A Demo

                                  Vertical IQ’s Industry Intelligence Platform

                                  See for yourself why over 60,000 users trust Vertical IQ for their industry research and call preparation needs. Our easy-to-digest industry insights save call preparation time and help differentiate you from the competition.

                                  Build valuable, lasting relationships by having smarter conversations -
                                  check out Vertical IQ today.

                                  Request A Demo