- IMG

IMG

The American Bus Association (ABA) has released motorcoach industry closure data gathered from the Federal Motor Carrier Safety Administration (FMCSA).

According to FMCSA, in a typical year such as 2018 or 2019, the motorcoach industry would expect to see an average of 100-120 passenger companies lose operating authority.

The data collected by FMCSA shows a surge in losses of authority for motorcoach operators in 2020, which means these companies are no longer providing transportation, in some cases forever. There have been nearly 500 companies who have lost their operating authority, whether voluntarily or involuntarily, so far this year (482 through Nov. 30), a 400% increase over 2019. Nearly 72% of these losses of authority occurred between April and August, during the height of the pandemic.

 - ABA

ABA

According to FMCSA records, only 26 (5%) of the closures in 2020 appear planned in advance, with an “Out of Business” form filed with FMCSA. It is unknown how many other companies remain open in “name” only or on the brink of formal closure.

"2020 has been an extraordinary year in terms of companies no longer operating buses," said Peter Pantuso, ABA president and CEO. "Between April and August 2020, we saw the equivalent of nearly three years of closures in just four months. I do not know of any other transportation industry impacted as severely by this pandemic as the motorcoach industry. Our industry is unique, and we need a bridge to a time of recovery, which is at least 12 to 24 months away."

It is important to note that the motorcoach industry is a capital-intensive industry, where the largest cost are the costs of equipment and insurance with payments at the mercy of deferments by lenders and vendors. With the reduced demand for transportation services because of the pandemic these numbers could significantly increase in the future.

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