Conversion of bus fleets: Less money for e-buses - industry warns of consequences

The federal government is funding the purchase of electric buses for local transport with hundreds of millions of euros. Starting next year, the funds are expected to decrease significantly. The industry therefore sees the climate goals at risk.

The federal government wants to promote the purchase of electric buses for local transport with significantly less money. (Archive image) Photo: Jens Büttner/dpa

Berlin. From the perspective of the transport industry, the conversion of local bus fleets to alternative drives is in danger of stalling. The reason for this is a drastic cut in funding for the purchase of e-buses, which the federal government is planning for next year. The funding is expected to fall from the current around 403 million euros to around 130 million euros, as can be seen from the federal government's draft budget for 2027.

This would mean that the European requirements for converting existing diesel bus fleets to emission-free drives could not be achieved, as shown by an analysis by the Association of German Transport Companies (VDV) and the Climate Alliance Germany. There is also a risk of a weakening of Germany as a business location.

German manufacturers benefit from funding

According to the study, which was carried out by the consulting firm PWC on behalf of the associations, German and European manufacturers in particular benefit from the funding. Almost three quarters of the electric buses used in this country come from German manufacturers. Daimler Buses and MAN are clear market leaders. Up to 12,600 jobs depend on the German market for electric city buses. The associations argue that a reduction in funding would weaken the value chain.

If the funding cut comes as planned, the transport companies would have several options to respond to it, the analysis says. They could operate their existing diesel bus fleet longer than planned or buy new diesel buses instead of new electric buses. Another variant would be to purchase electric buses from non-EU countries - especially China.

E-buses are still significantly more expensive

The problem with the conversion is the still high acquisition costs. Electric buses are significantly cheaper to operate than diesel vehicles due to their lower energy costs. However, the need for more vehicles due to shorter ranges, the development of a charging infrastructure and the price of the buses themselves lead to significantly higher costs.

“A battery bus newly registered in 2023 costs around 30 percent more as a depot charger over the entire twelve-year life cycle (with 55,000 km of mileage per year) than a diesel bus,” says another PWC analysis from last year. This cost gap is likely to narrow somewhat over the coming years. But it won't disappear completely.

According to the VDV and the Climate Alliance, there are currently around 6,000 emission-free buses in local transport in Germany. That corresponds to around twelve percent of the nationwide bus fleet. Almost every second new public bus last year was electric. The EU stipulates that this proportion must increase to at least 65 percent by 2030.

Progress varies greatly regionally

In a recently presented evaluation, German Environmental Aid (DUH) found that regional progress in converting to alternative drives varies greatly. Pure diesel drives make up around 70 percent of the fleets in the 39 largest cities. If you take into account so-called mild hybrids, in which an electric motor supports the combustion engine - often especially when starting and overtaking - the rate is even as high as 77 percent.

The study also shows that some large cities are already far along in switching to climate-friendly and environmentally friendly battery-powered electric buses. The environmental organization named three cities from Baden-Württemberg as the frontrunners: Mannheim, where 60.6 percent of the bus fleet was battery-electric at the turn of the year, tops the table, followed by Freiburg (51.7 percent) and Karlsruhe (51.6 percent).

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