Dealer Update:
The Small & Midsize Bus Market in 2018
BUSRide spoke with representatives from some of the nation’s leading bus
dealers to hear their thoughts on the current state of the small and midsize
bus market, new technological developments and growth opportunities for
operators running these vehicles.
The panelists for this discussion were:
Eugene Hotard – executive vice president – Alliance Bus Group
Josh Davey – vice president of sales and marketing – Davey Coach Sales
David Schetky – vice president – Schetky Bus and Van Sales
Please briefly describe your operation and the applications in which your
customers specialize.
Josh Davey: Our customers are in many different segments of
business. We are a full-service dealership, with solutions for facet of
the customer experience. From vehicle options to purchase financing,
to delivery, parts & service, and graphics, we offer a wide range of
options to serve our customer needs. Additionally, we accep t trade-
ins, which we are able to push back out into the secondary market as a
certified pre-owned vehicle.
Eugene Hotard: Alliance Bus Group is a full-service bus dealership
with locations in seven states. We stock and sell a large selection of
vans, small and midsized buses, heavy-duty transit buses and intercity
coaches. We also offer specialized vehicles, like the convertible Sprinter
with retractable roof and trolley buses. Our customer base includes
many different types of customers with unique needs. Our main
vertical markets are charter companies, transportation companies,
tour companies and limousine companies; however, we also put a lot of
effort and energy into other markets like senior care, parking, colleges
and universities, hospitality and child care markets.
David Schetky: Schetky Bus and Van Sales was founded in 1942 and
is one of the original bus and van dealers in the United States. The
company was created when there was a need for shipyard worker
transportation during World War II. Jack Schetky, the founder,
had experience building school buses, so when he was asked to
manufacture buses for the shipyards he quickly got to work. When
Jack’s son John returned home from WWII, he took over the company
and expanded the business. Schetky is now a fourth-generation family
owned business, whose customer base ranges from transit agencies,
to school districts, to large national corporations. After all these
years, Schetky continues to grow as one of the nation’s largest bus and
van dealers and prides itself as being a service and support business
first. This coincides with how the company was founded, in that our
job is to not only provide the best products, but also an unmatched
level of after-the-sale support to ensure our customers are best served
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during the life of their vehicle. We meet these objectives because we
understand that that our customers’ success depends upon it, and we
always work our hardest to build long-lasting relationships with every
transit agency and fleet operator.
If you had to give a “State of the Small & Midsize Bus Market” address to
the industry, what would you say?
Hotard: Our industry is very stable, as the industry produces
between 14,000 and 15,000 units a year, with about a 50 percent split
between the public and private sectors. The public sector funded by the
Federal Transit Administration (FTA) is a huge portion of the midsize
bus industry. There has been a tremendous amount of manufacturer
consolidation in the midsize vehicle industry, and some consolidation
of distributors, and it has helped our products. Manufacturing
companies now have more resources, and thus are consistently
building vehicles of a higher quality.
Davey: I would say that customer expectations have shifted. They
expect variety and options, not just with manufacturers, but also with
options for purchase, lease, and rent. Listening to their needs has never
been more important because they are well-acquainted with what they
need and have an expectation for us to deliver.
Schetky: The state of the small and midsize market is beginning
to look better. During the economic downturn, manufacturers
recognized the lack of transit agency funding, and began marketing
low-cost buses that were not designed for transit-use as a comparable
product. These buses are referred to as Bid-Buses, in that they are
priced the lowest and can win bids that only take lowest-cost into
consideration for award. What was discovered, though, was that
these Bid-Buses were not built to withstand the rigors of transit use.
For church use, where the bus might be driven two-thousand miles
per year, these buses can occasionally work, but not for transit. As
everyone knows, the true cost of a vehicle is called its Total Cost of
Ownership. This is a “buzz phrase” that has been repeated millions
of times, but its familiarity shouldn’t cheapen its impact. It is a very