Fuel Cell Electric Bus Market Assessment, By Bus Type [New Hydrogen Buses, Retrofitted Hydrogen Buses], By Application [Intercity, Intracity], By Technology [Proton Exchange Membrane Fuel Cells, Direct Methanol Fuel Cells, Zinc-Air Fuel Cells, Others], By

Fuel Cell Electric Bus Market Assessment, By Bus Type [New Hydrogen Buses, Retrofitted Hydrogen Buses], By Application [Intercity, Intracity], By Technology [Proton Exchange Membrane Fuel Cells, Direct Methanol Fuel Cells, Zinc-Air Fuel Cells, Others], By Power Output [<150 KW, 150-250 KW, >250 KW], By Transit Bus Models [30 Foot Transit Buses, 40 Foot Transit Buses, Others], By Region, Opportunities and Forecast, 2017-2031F

Global fuel cell electric bus market is projected to witness a CAGR of 27.85% during the forecast period 2024-2031, growing from USD 501 million in 2023 to USD 3576.38 million in 2031. The evolving public transportation across the globe, electrification of buses, and usage of alternative fuel in vehicles are most likely to replace the vehicles comprising IC engines. The advanced electric and fuel cell propulsion, delivering higher efficiency and mileage are transforming public mobility solutions. Buses are one of the fastest and easiest methods of end-to-end commuting and hence hold a high adoption rate. Apart from electric buses, the adoption of fuel-cell electric buses is also drastically increasing in urban cities. With the rising urban population, governments focus on limiting the carbon footprint by implementing different vehicular emission norms. The huge subsidies, increasing fossil fuel prices, and lower maintenance costs are some of the other factors that strive the global fuel cell electric bus market.

Harmful tailpipe emission is one of the factors impacting the market growth. The instant smooth torque, consistent power, fast refueling, higher range, and low maintenance dynamic of fuel cell electric buses make it a better choice. The increased pollution levels of major urban cities witness the high adoption rates of fuel cell buses. The retrofitting operations done by the auto majors are also fuelling the market expansion.

For instance, in October 2023, Toyota Motor Corporation retrofitted its hydrogen fuel-cell powertrains to 10 motor coaches that are going to be used in 2024’s Olympic Games in Paris. Hydrogen fuel-cell modules will be supplied by Toyota to transform the Iveco coaches, which are currently in use, into zero-emissions vehicles (ZEVs) for GCK, a consortium of industrial companies providing technology solutions to speed up the decarbonization of transport.

Higher Efficiency, Lightweight Design, and Depleting Fossil Fuel to Fuel Market Growth

The increased adoption of fuel-cell electric buses is attributed to the discovery of vast hydrogen gas through offshore reserves. This is likely to limit the increasing hydrogen fuel prices and widen the adoption of fuel cell electric vehicles (FCEVs). For instance, in January 2024, University of Lorraine researchers discovered a massive underground reservoir of natural hydrogen over 1,000 metres deep in north-eastern France, which can bring revolution in clean energy.

The increased sales of these buses are also due to the lightweight design, higher performance, longer range, and quieter functioning. Furthermore, the rising prices of crude oil due to higher import tariffs, depleting reserves, and ongoing wars around the world are also pushing end-users to seek public transport that is cheap, efficient, and sustainable. Major brands also equip new hydrogen fuel cell vehicles with their hydrogen retrofit kits.

For instance, in June 2023, Safra Automobiles (Safra Group) showcased its new hydrogen coach at UITP (Union Internationale des Transports Publics). In addition to the hydrogen retrofitted coach, the company also offers a hydrogen retrofitted coach kit called the H2- PACK, which has been developed to transform a combustion-fuelled intercity coach into a zero-emissions vehicle.

Extended Research and Development and FC-Battery Hybrid Systems to Expand Market Size

The rapid research and development programs have supported the automotive energy transition procedures while adding new fuel cells to the sector. The high cost associated with the production of hydrogen gas has led energy exploration entities to look for other fuel cells such as polymer electrolyte membrane fuel cells, direct methanol fuel cells, and others. The wide variety of fuel cell types allows fuel cell buses to remain a cost-effective option for public transportation. Furthermore, the most common topology is a hybrid power system that combines fuel cells with batteries. Batteries offer the benefits of high-power density, low operating costs, and extended range, helping the market growth.

For instance, in October 2023, Otokar introduced its first Fuel Cell Electric Bus KENT Hydrogen, and 13 Metre Electric Interurban Bus e-TERRITO at Busworld Europe 2023. Otokar's Technology Demonstrator Bus Autonomous e-CENTRO took visitors to the exhibition by shuttle between the exhibition halls. Otokar devotes 7% of its revenue to Research and Development (R&D) to enhance fuel cell technology.

Government Support to Innovative Automotive Manufacturing Solutions

Governments around the world are transitioning to vehicles that run on alternative fuels. The supportive government policies, extension of subsidies, and public-private partnerships are expected to help the market expansion. Furthermore, the government authorities are also focusing on energy exploration programs that locate new gas reserves, increasing the production of hydrogen and other gases. This directly impacts the fuel price and availability, increasing the sales of fuel-cell electric buses for private and public transportation. Limiting the cost of fuel cells along with the strengthening of raw material supply chains are projected to support FCEV manufacturing.

Electric buses are attracting the attention of governments around the world. Market growth is expected to be supported by government mandates to phase out fossil fuel-powered vehicles, government spending to enhance public EV charging facilities, and government incentives such as subsidies and tax rebates to promote EV adoption. Various governments are investing in fuel cell electric vehicle (FCEV) infrastructure, including hydrogen filling station infrastructure, both directly via public filling stations and via subsidies.

For instance, in September 2023, Tata Motors delivered two hydrogen fuel cell-powered buses to Indian Oil. In June 2021, the Indian Oil Corporation Limited (IOCL) awarded a tender to Tata Motors for the supply of 15 Fuel Cells and Hydrogen (FCE) buses to test hydrogen-based PEM fuel cell technology in India.

Higher Efficiency and Easy Availability of Raw Materials to Fuel Segmental Growth

Based on the technology, the fuel cell electric bus market is segmented into proton exchange membrane fuel cells, direct methanol fuel cells, and others. The proton exchange membrane fuel cells segment is projected to be the fastest growing in the next forecast period. Proton Exchange membrane cell (PEMC) is widely used as it works effectively with fuel cell buses. It is used to convert the chemical energy released during an electrochemical reaction between hydrogen and oxygen to electrical energy.

Other factors for the segmental growth include the high-power density produced in FC operation along with the low operating temperature that makes it suitable for commercialization. The higher efficiency delivered by PEM for quick start, low operating temperature, and lower emissions also contribute to segmental growth.

For instance, in October 2023, Ballard Power Systems announced the purchase orders for a total of 177 hydrogen fuel cell motors from long-time customer Solaris Bus & Coach. Ballard zero-emission PEM fuel cells are revolutionizing the electrification of mobility in a wide range of applications, including buses, commercial trucks, trains, marine vessels, and stationary power.

Europe Region Dominates in Global Fuel Cell Electric Bus Market

Based on region, the European region holds the major position in the market due to environmental concerns leading to rising use of sustainable transportation. It is expected that many hydrogen buses will be deployed in Europe over the next few years, mainly in Italy, Germany, and the United Kingdom where electricity and diesel prices are currently high. At the end of the forecast period, battery-electric buses are expected to be the most affordable option throughout the region.

In May 2023, Daimler (Mercedes-Benz) presented its new fuel cell electric bus, the first of its kind in series production with a range-extender fuel cell (eCitaro), at the global public transport summit (GPT Summit) in Barcelona. The Mercedes-Benz eCitaro fuel cell, with a 350-kilometer range and 128 passenger capacity, is a demonstration of electric buses replacing city buses with combustion engines. It uses a 60kW fuel cell with a maximum battery capacity of 392kWh, allowing it to manage longer routes and mountainous terrain.

Future Market Scenario (2024–2031F)

• The focus on limiting carbon emissions and expanding hydrogen fuel availability is expected to flourish market growth in the future.

• The integration of battery technologies with fuel cell propulsion provides higher range and efficiency to the vehicle. The technology is anticipated to be used during the forecast period.

• Government subsidies and tax cut policies are expected to propel market growth.

• The advent of new fuel cells such as methanol and phosphoric cells is expected to expand the market growth.

Key Players Landscape and Outlook

The key players in the market are focusing on expanding the availability of new fuel cell resources while building an efficient bus structure to deliver efficient performance. Additionally, companies are attempting to reduce costs through the implementation of affordable alternatives. Furthermore, mergers, collaborations, and acquisitions add strength to supply chain and distribution pipelines. Obtaining government tenders also become a crucial part of the expansion strategy. Key players in the global fuel cell electric bus market also collaborate with different technological advanced companies to deliver better mobility solutions.

For instance, in February 2024, Caetano Co. won a tender to deliver 10 hydrogen buses to Vienna. Following an open tender procedure in Europe, Toyota partnered with CaetanoBus to become the successful tenderer for the supply of H2.

In January 2024, Ballard Power Systems and NFI Group entered into a new long-term supply agreement. The scope of the agreement is to deliver deployment-level quantities of FC move-HD+ fuel cell-powered buses across all brands of NFI Group, including NFI New Flyer, NFI Alexander Dennis, and NFI MCI. The first purchase order under this agreement is for at least 100 FC move-HD + modules scheduled to be delivered in 2024.