America’s intercity bus industry is undergoing a metamorphosis amid a gradual recovery in passenger traffic, driven by a return to normalcy in long-distance travel and a dramatic rise in gasoline prices, which has boosted driving costs. Competition on most major routes is again fierce, accentuated by the expansions of FlixBus, carriers catering heavily to Spanish-speaking populations, and a bevy of lines operating from the vicinity of New York Canal Street, home to the city’s Chinatown neighborhood. Over the past few months, the intercity bus industry has, in a sense, awakened from its pandemic slumber.
Our new report, “Routes to Recovery: 2022 Outlook for the Intercity Bus Industry,” shows that nearly all the largest carriers on the roads in early 2020, save for the Greyhound-owned BoltBus, which permanently shut down in September, are back, albeit with service offerings that are in some cases below pre-pandemic levels. Most carriers are suffering from deterred maintenance, shortages of drivers and mechanics, and difficult cash-flow issues, accentuated by shortfalls in federal support made available during the pandemic. But consumers across the country once again benefit from abundant offerings.
A Competitive Spirit Returns
Competition, while pervasive throughout most of the country, is particularly acute in the Northeastern states. The Boston–New York route has seven major competitors, GoBuses, FlixBus, Greyhound Lines, Lucky Star, Megabus, OurBus, and Peter Pan, all offering multiple daily schedules between these cities or nearby suburbs. On the busy New York–Washington route, no fewer than 15 bus lines vie for passengers. All but two offer several daily departures. A pair of them, Tripper and Vamoose, offer both regular and business-class options.
“Travelers in the Boston–New York–Washington corridor have far more bus-travel options than most realize, given how difficult the pandemic has been for the sector,” noted Allison Woodward, a co-author of our study. Ten carriers operate from Midtown Manhattan to Washington, while the other five from the vicinity of New York’s Canal Street. Four of these carriers, Flixbus, Greyhound, Megabus, and Peter Pan, rank among the largest intercity bus providers in the U.S. The bus industry provides vigorous competition to Amtrak, which has a large share of the market as well.
In the West, several carriers have expanded since the demise of BoltBus and Megabus’s withdrawal from California and Nevada. Hispanic-oriented bus lines, including Los Angeles–El Paso Limo and Tufusa, have grown, as has FlixBus. Salt Lake Express grew in Nevada and Utah, while Bustang (funded by Colorado’s transportation department) expanded in central Colorado. Still, we anticipate more service rollouts in the Western states later this year, in part due to pandemic-related population shifts.
In the Midwest, competition has been more subdued, due in part to the withdrawal of Megabus, which now only serves routes linking Chicago to cities in Wisconsin and Minnesota. Among the beneficiaries are Burlington Trailways, long a dominant player on the Chicago–Des Moines–Omaha route, and Barons Bus and Miller Trailways, which have extensive networks in Indiana and Ohio.
Megabus’s retrenchment has also created opportunities for FlixBus, which, at the start of 2021, did not yet service Chicago. By autumn, the Windy City had become a bona-fide hub. In July, FlixBus debuted service from Chicago to Columbus, Ohio (via Indianapolis) and Milwaukee, Wis., and the following month, it started Chicago to Minneapolis service via Madison, Wis. In August, FlixBus launched a route from Chicago to Detroit. On some routes, buses operate only on certain days, although the schedules could be expanded this summer.
One of the biggest — and surprising — stories of recent months, though, was FlixMobility’s purchase of Greyhound. The Germany-based company, parent of FlixBus, appears eager to expand its U.S. footprint, but has yet to reveal its plans for the historical carrier. For the moment, it appears content to keep the two brands’ ticketing systems and operations separate, and the deal, announced in November, excludes Greyhound’s large real estate holdings. Despite this, we expect the two carriers to gradually coordinate to leverage the different strengths of their respective systems.
New Premium Services vie for Frequent Flyers
A particularly significant development in recent months has been the expansion of first-class seating and services. Out of hard times has come a surprising burst of innovation. This includes The Jet, which as of November offers a twice-daily premium service between New York’s Hudson Yards and Washington DC’s Metro Center. With just 14 seats (in a 2-1 seating configuration) on its full-size coaches, and an on-board attendant serving light snacks and alcoholic and non-alcoholic beverages, The Jet seeks to lure both Amtrak riders and frequent flyers. Unlike other first and business class offerings, The Jet offers the “HoverSeat,” a custom-designed seat equipped with Bose suspension technology, which is said to “block 90% of the bus ride’s bumps and movements.” Fares are typically between $99 and $149, less than half the cost of walk-up airfares and Amtrak’s Acela tickets.
Another new premium brand serving the Washington, DC area, Rapid Overland Express, relaunched its premium express service between Virginia Beach and Pentagon City, Va., in July, also with an onboard attendant. Passengers travel in deluxe coaches with 22 seats and enjoy catered meals during breakfast and lunch, served by an attendant. “ROX” offered four trips weekly after restarting service, which debuted in 2020, with trips four times weekly. ROX has also experimented with the Virginia Beach to Charlottesville, Va., route, which could return during peak season.
The largest and perhaps most notable rollout last autumn was RedCoach’s launch of first- and business-class service in the Texas Triangle, linking Austin, Dallas, and Houston, with en-route stops in Waco and College Station. Its first-class coaches have just 27 seats, and its business-class coaches have 38, giving customers more space than the 50-plus seats offered by many conventional services. Its custom seating offers spacious legroom and bed-like seats that recline up to 140 degrees (50 degrees from a vertical position). Customers also enjoy complimentary snacks. RedCoach, which has long had a large Florida operation, operates from a curbside location next to the Hutchison Convention Center in downtown Dallas.
Less luxurious but also newsworthy is a major expansion by Landline, which seeks to shift travelers away from uneconomical short-hop flights and onto motor coaches. Landline forged a partnership with United Airlines last year that allowed for through-ticketing via Denver International Airport (DIA). The service includes four daily buses in each direction from DIA to the regional airport in Fort Collins, Colo., and a daily roundtrip from Breckenridge, Colo. Customers can book tickets that involve connections between coaches and flights both on the airline’s website and other airline-ticketing platforms. Our research team consider this concept a “game changer” for the U.S. travel market, which has been slow to enhance intermodal connections.
The Landline/United partnership affords travelers protected connections, so if a bus or flight is late, the passenger will be accommodated in the same way as those missing flight connections. Passengers board coaches leaving DIA from a gate behind (airside) security, much like those catching other flights, whereas those arriving at DIA are dropped off on the groundside and must pass through security. Landline also has a sizeable operation at Minneapolis-St. Paul Airport in partnership with Sun Country Airlines.
The expanding network of premium bus operators includes the return of business-class services available before the pandemic, including Vamoose Gold and Tripper Elite in the Northeast Corridor and Vonlane in Texas, as well as on its relatively new Dallas–Oklahoma City route. C&J Bus Lines, Concord Coach, and Dartmouth Coach have restarted their business-class service between Northern New England and New York, which features extra legroom and onboard snacks.
Such expansion raises an important question: Will the big players like Greyhound, FlixBus, Megabus, and Peter Pan get in on the action by creating premium services of their own? Most of these lines appears content, at least for the moment, to push non-luxury-related perks. Woodward notes that Megabus’s “reserved seating and a sophisticated bus-tracker add to the allure of its service.” Fast-growing FlixBus tested a premium service on the Los Angeles to Las Vegas route last year, marketed as “FlixPlus” that featured extra legroom and complimentary snack and beverage service served by an attendant. Whether FlixBus will permanently move into premium service remains unseen.
The Road Ahead
Another sign that bus lines anticipate a sustained recovery was Greyhound’s resumption of transborder service from New York to Montreal, QC, from Buffalo to Toronto, and Seattle to Vancouver, BC, in September. These routes have historically been major revenue generators for the legacy line, with the New York–Montreal running in partnership with Adirondack Trailways. Notably, Greyhound restarted service to Canada sooner than Amtrak, which had yet to resume operations across the border (or even announce a definitive date for doing so), in part due to continued policy uncertainty, especially regarding the Canadian government.
Legislation from Capitol Hill remains something of a “wild card” at the moment. The bipartisan infrastructure bill could spur a robust expansion of the Amtrak Thruway bus system, which can help federal and state agencies work to enhance the country’s rail-passenger network. States can also take advantage of the growing latitude they are given to market bus and Amtrak service on the same ticketing platforms, even for passengers who are not making bus or train connections. “It remains to be seen how quickly, if at all, legislation for ‘decarbonization’ of travel will swing public policies in the bus industry’s favor,” notes Abby Mader, another study co-author.
Regardless, our study predicts that traffic will return to about 75% of pre-pandemic levels on routes carrying little commuter traffic by summer and reach 80% of pre-pandemic levels by next year. “After enduring so much financial hardship, it is good to see the industry once again experimenting with so many new services,” notes Mader. With the price at the pump now exceeding $4 per gallon in much of the country, people — particularly those on solo trips — have added incentive to hop on the bus.
Joe Schwieterman is professor and director of DePaul University’s Chaddick Institute.