Our markets

Market size

€3.5bn

• Regulated bus and intercity coach market 

Concessions

172

• ALSA has 141 intercity coach concessions, 31 urban bus contracts and one other concession

Market composition

• ALSA has the leading position in a highly fragmented market 

Market trends

• Slight decline in bus and coach market passenger volumes since mid 2012, reflecting resilience in public transport trends compared to other modes of transport and wider austerity impact in Spain
• Passenger growth in Morocco

Market features

• Regulated and highly segmented market, with three levels of Government regulation: national (long distance coach), regional (regional coach) and city (urban bus)
• Each concession is exclusive to the operator, based on compliance with the public service obligation
• Flexibility required to meet changing demand

Customers

• Urban: all ages, work and study, multiple trips per week
• Intercity: mostly young people, few trips per year; for leisure, visiting family; on regional services also work and study

Competition

• Intercity competition from state-backed rail and low cost airlines (cutting capacity in 2013)
• Bus and coach concessions are awarded through competitive public tender, typically every ten years

Labour

• Historically less flexible labour market reflecting domestic practices; unionised
  
• Austerity measures driving some reform

Growth

• New business growth from concession renewal, urban contract wins in Spain and Morocco

Market size

US$24bn

• Total school bus market in North America, represented by 531,000 route buses
• 32% is outsourced; 68% in-house

National Express market share

11%

• of outsourced school bus market
• National Express operates 17,870 regular routes

Market composition

• Top four players operate approximately 90,000 routes
• 40 companies operate 200+ buses; rest of outsourced market split between 4,000 operators

Market trends

• Growth traditionally inflation and population driven; recent increase in outsource conversion due to public funding pressures.

Market features

• Local relationship and service delivery important

Customers

• Local school boards, funded largely by local property taxation
• Transport is a significant part of local education spending

Competition

• Bigger players have access to capital, geographical reach and some scale advantages
• Potential for some market consolidation

Labour

• Traditionally part time workforce
• Over 30% of National Express staff unionised

Growth

• Winning contracts in the school bidding season, primarily through outsourcing/conversion as well as market share shift
• New Transit business has a pipeline of contracts being targeted

Market size

£4.8bn

• 97% is privatised

National Express market share

1,660

• 1,660 buses operated in the fleet
• Focused on the West Midlands and Dundee markets 

Market composition

• Largest five operators represent around 70% of the UK market
• Remainder made up of a large number of private operators 

Market trends

• Short-term economic pressures from austerity and local unemployment
• Longer term economic regeneration and environmentally-driven public transport growth opportunities over the car 

Market features

• Primarily deregulated market; vehicle/ regulatory oversight
• Low barriers to entry - flexibility and scale of operations is key 

Customers

• Over 90% of West Midlands network is commercial; remainder mostly public service tenders
• Around 75% of revenue from passengers, balance concessionary 

Competition

• Active competition from national and local operators, as well as private car

Labour

• Primarily unionised with strong industrial relations 

Growth

• Growth strategy is focused on increasing passenger volumes through investment in vehicles and technology, as well as delivering high quality services.

Market size

£300m

• of contested revenues in the scheduled coach market (almost all privatised)

National Express market share

1,000

• Around 1,000 destinations served
• National Express is the UK scheduled coach market leader

Market composition

• National Express has the only nationwide network of services
• Other competitors tend to focus on specific regions or corridors 

Market trends

• Core revenue growth, reflecting value and convenience of coach
• Price competition from rail through discounted fares

Market features

• Highly deregulated market
• Customer safety and disability access supported by regulation
• Operators able to compete flexibly on selected routes 

Customers

• Customer satisfaction important in driving longer term loyalty
• Attracted by fare discount to rail, increasing cost of private motoring and environmental friendliness

Competition

• Selective competition from large bus operators and localised services 

Labour

• Outsourced model; 80% operated by third-party partners on long-term contract
• Consistent service and behaviour standards across all operators 

Growth

• Revenue growth through improved retailing systems and greater understanding of our customers and their needs

Market size

£6bn

• of UK franchise revenues over next five years (based on estimated pipeline)
• €6bn currently accessible German regional rail market

National Express market share

• One franchise remaining after NXEA handover in February 2012
• c2c (Essex Thameside)

Market composition

• Top four players have around 70% of the market
• 19 UK franchises in total

Market trends

• Growth over the past decade driven by passenger volumes
• Dependent on GDP and employment, particularly central London employment for c2c
• Regulated fares will increase by 1-3% in real terms over next two years
• Liberalising German rail market

Market features

• Regulated environment
• Current framework has 7-10 year franchises
• Highly regulated qualification and operational processes

Customers

• Steady growth in passenger volume over last 20 years

Competition

• Increased international competition in UK franchise bidding 

Labour

• Relationships are managed within each franchise, with high union representation 

Growth

• Successful bid to retain c2c and bidding for other UK franchises
• Further bid wins in Germany