Bus & Coach operators invest in assets to drive post-covid growth
Propel has released a landmark study revealing the financial outlook among bus & coach operators post-pandemic; and indicates the key investments that they planned for 2021/22 and how they intended to finance them.
This in-depth survey of 148 UK operators explores the latter’s perceptions of and attitudes towards the bus & coach sector’s financial outlook. This important study also examines the role of asset finance as a growth accelerator as the sector emerges from the pandemic.
- Nearly 44% of bus & coach operators are positive about the financial outlook for the industry over the next 12 to 24 months
- 65% of bus & coach operators expect the impact of Covid-19 to be the main constraint to growth in the next 12 to 24 months
- 78% of bus & coach operators are looking to invest in their businesses in the next 12 months
- Asset finance is the pre-eminent form of finance for the sector, with 61% of operators seeing clear benefits of using it to acquire vehicles and equipment
The Bus & Coach sector has been severely impacted by the effects of Covid-19. However, less than half of those operating in the sector view the next two years negatively. The majority of operators are now looking ahead to enhance their fleets with an increasing focus on acquiring new technology such as low emission power trains, air cleaning and purification units. There is also a growing trend towards investing in additional & replacement vehicles; and broadening their appeal with the latest accessibility equipment. Coaches and midi-coaches remain the most common areas for investment over the next 12 months; and PSVAR conversions & accessibility equipment have become the second most popular assets. Other investments currently being considered include buses & midi-buses, workshop equipment and exhaust retrofitting.
The survey also shows that UK bus & coach operators are increasingly looking at flexible finance options to help grow their businesses. The findings highlighted that asset finance is the most popular form of finance – recognised for offering immediate use of the asset, affordable payments and no capital outlay.
The UK bus & coach sector is emerging from a period of extreme uncertainty. A population under lockdown and limitation on domestic & foreign travel have had a material impact on both UK and international markets.
Of critical concern is the feeling among half of those surveyed that they feel unable to obtain finance from lenders due to a perceived lack of appetite for the sector. Throughout this period, Propel has continued to support the bus & coach sector as it navigates its way through the pandemic. Despite all the challenges brought about by Covid-19, there remains an inherent resilience and positivity in terms of the industry’s future; and a strong desire to continue to invest in both core fleet assets & new technologies.
As people begin to travel around the country for business purposes and holidays, quick & easy to access finance will be vital to support the strong return of the bruised but unbroken bus & coach industry.
To download and read the full National UK Bus and Coach Finance Report 2021, click here.