Public Transportation Market Size, Share & Trends Analysis Report By Distribution Channel (Online, Offline), By Mode Type (Road, Rail), By Region, And Segment Forecasts, 2023 - 2030

Public Transportation Market Growth & Trends

The global public transportation market is anticipated to reach USD 374.15 billion by 2030, expanding at a CAGR of 7.6% from 2023 to 2030. Government authorities and travel agencies in developed regions are extensively working on modifying road pricing strategies associated with traffic congestion and pollution challenges. In December 2021, the World Economic Forum, in its Sustainable Road Transport and Pricing report, stated that several cities, including London, Singapore, Stockholm, and some of the developed cities in the U.S., are implementing ‘congestion pricing’ strategies to reduce traffic congestion on the busiest roads of the cities. Consequently, local authorities aim to curb traffic congestion while enhancing public transportation, contributing to market growth.

Several governments are encouraging travel through public transportation by reducing fares and providing free services to some age categories. For instance, in March 2022 and September 2021, Detroit and Miami started offering free public transportation and door-to-door pick-up and drop facilities to people with disabilities and elderly passengers. As mass transit costs are lower than the fixed costs of owning a car and the operational costs of running a car, people are more inclined toward using public transportation. Thus, by engaging older adults with public transportation, the local governments plan to reduce traffic congestion and enhance public transportation. This is driving the market growth.

Digitalization has the potential to strengthen public transportation as an important aspect of urban mobility and enable it to meet future demands. The public transportation sector is poised to witness several opportunities to reduce operational costs, introduce new revenue streams, increase working efficiency, and improve the quality of travel, comfort, and overall customer experience with the rising adoption of digital transformation strategies in the sector. Moreover, the growing emphasis of several governments on promoting various initiatives under smart city programs, smart public transportation, and intelligent traffic management systems is also anticipated to facilitate the growth of the market over the forecast period.

For instance, the Singapore federal government’s Smart Mobility 2030 Strategic Plan enables high adoption of big data analytics and data-driven methodologies to analyze a traveler’s experience and manage traffic situations more smartly. Moreover, various tools such as Orange Transport Video Alert are being used extensively to understand traffic congestion and other street circumstances by gaining real-time insights through video streams. Similarly, in November 2022, the U.S. Department of Transportation announced investment worth $160 million annually over the following five years in two programs, namely, strengthening mobility and revolutionizing transportation (SMART) grants program projects; it will get $100 million in grants annually over the subsequent five years and intent to fund projects that use data and technology for solving real-world challenges facing by the communities. The second investment worth $60 million is in the Advanced Transportation Technology and Innovation (ATTAIN) program by Federal

Highway Administration to promote technological advancements by ensuring safety and minimization of travel times for transit riders and drivers.

Public transportation market report highlights

• By distribution channel, the offline segment is expected to dominate the market throughout the period of market study. A large percentage of the global population still appreciates the personal approach that comes with the physical process of buying tickets. Moreover, it can be highly cost-effective for travel agencies and government authorities to implement the offline mode of ticket distribution.
• The road segment is projected to witness the highest growth rate of more than 10% by model type. Several governments are emphasizing using public transport by roads to curb the excessive use of fuel and pollution levels. Moreover, increased consumer awareness about the environmental benefits of using public transportation could drive the segment's growth.
• The Asia Pacific region is projected to grow at the highest CAGR over 2023-2030. Governments of various countries in the region have announced tax exemptions and subsidies for purchasing electric buses to promote green transportation. This initiative is fueling the manufacturing of electric buses, driving the growth of the Asia Pacific market.
• The companies in the market have been involved in various strategic initiatives aimed at improving and gaining better traction in the market. Companies opt for partnerships, mergers, collaboration, and acquisition, among others. For instance, in February 2022, Transportation for London (TfL)announced a collaboration with MTR Elizabeth Line and its contractor, Walker Construction Limited, to improve access and provide more space at Burnham station. The improvements include the provision of new ticket vending machines, customer information screens, automatic ticket gates, and ticket office buildings with accessible ticket windows, and automatic ticket gates.

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