Carrier consolidations affecting motorcoach sales, but ABC/Van Hool sees continued steady growth

“There have been quite a few challenges as our industry is going through some shifting and consolidations, but we continue to see steady growth,” said Roman Cornell, president and chief commercial officer for ABC Companies.

While consolidation leads some combined operations to forego vehicle purchases, the resulting efficiencies create demands that push other carriers to enlarge or update fleets, said Cornell, whose company is the North American distributor for Van Hool motorcoaches built in Belgium.

Two factors are driving a significant portion of motorcoach sales, he said: the expansion of employee shuttle operations and the inclusion of motorcoaches into the fleets of limo and livery services. However, he added, the industry is struggling with a shortage of drivers that prevents many carriers from expanding fleets to accommodate potential ridership.

Efficiencies and growth

“We are seeing folks going for the efficiencies that are going to be gained with consolidated or larger organizations,” Cornell said. “A lot of the costs of operating a business in our industry are going up, and we know there will be some synergies that will happen with consolidation.”

The consolidation wave complicates the motorcoach market, he said.

“After consolidations there are often natural slowdowns in repurchases. A coach may have been ready for replacement, but after consolidating the new owner may see there is another coach that meets that need. Also, after they consolidate, they may see that they can combine less-efficient routes.”

Sometimes reorganized carriers may gear up to handle—or attract—more business.

“They will start refleeting right away,” Cornell said. “They become more efficient, pick up more business and then add another coach. Some customers try to differentiate themselves with newer, up-to-date fleets and offer premium service to their riders. We have seen growth from people who use that as a point of differentiation.”

Operators also are updating fleets, often to achieve greater fuel efficiency and add new technology while reducing operating costs, Cornell said.

Often the consolidations also bring together service and maintenance capabilities along with fleets that have a variety of coach brands in operation.

“Our ABC Parts Source team has brought in more suppliers, increased inventory, added shipping options, increased service hours and more to support these customers with a variety of makes and models in their fleet,” Cornell said.

“The consolidations and organic growth of our customer base has driven ABC to continue to invest in growing markets. Our Newark, California, facility has now been open for over a year and has been an important part of our support for many customers.  Investments continue in this facility and others as we prepare for future needs, such as recharge stations for our upcoming CX45E battery-electric coach,” he said.
“Our Jersey City, New Jersey, location is going through an extensive renovation and update to support our customers’ operations in that area.”

Passenger trends

If there is one reason that potential riders are being left at the curb—and motorcoaches left on the dealer lots—it is the driver shortage, he said. “The one good thing we continue to see is that no one has said their ridership is down. Customers who have gone through consolidations still have the same base of passengers. People continually say, ‘If I had more drivers, I could buy more buses.'”

ABC expects the motorcoach industry to benefit in the years ahead from a growing acceptance of ridesharing.

“We continue to see as a population within North America that is becoming more comfortable in utilizing ride shares and getting around without a private vehicle,” Cornell said. “We think that is going to stimulate more demand in the market, which will be good for our customers.”

Evolutionary change

ABC and Van Hool focused on upgrades to existing models in 2019, Cornell said.

“We added availability of a number of features such as RECON, which stands for ‘readiness for emergency conditions.’ We took our adaptive cruise control unit and added the collision mitigation system that we have not had in the past.”

The need for a seemingly quirky tech feature was identified through telematics tracking. “We added a solar panel system that continuously trickle-charges the batteries.  As we monitored fleets, we found that one of the biggest challenges was having to do a jump-start when an accessory was left on.”

Another addition, a HEPA (high-efficiency particulate air) filter for the ventilation system, was requested by an operator.

Further interior enhancements are being built into 2020 Van Hools, he said. “We will have several updates in the passenger and driver areas. We have elongated the driver’s area and have changed materials in the passenger entry points—the high-use, high-wear areas.

“We are trying to increase the look and appeal by adding more textures and soft-touch materials and satin metal finishes. We will have something that looks nice and is designed to wear even longer than traditional plastic or rubberized materials.”

Also coming for 2020 will be reconfigured restrooms and digital dashboards on the Van Hool CX models.

Revolutionary addition

Van Hool unveiled a prototype of its battery-electric motorcoach, the CX45E, at the Busworld exposition in Brussels, Belgium, in October. The first production copy of that coach, designed in association with the Proterra battery technology company, will be displayed at the United Motorcoach Association’s Motorcoach EXPO in Nashville in January.

“We are looking to have demos available in the first half of 2020,” Cornell said.  “We are seeing a lot of interest in electric coaches, but that is a very specific utilization. Most of the customers who are very interested in them are running routes where they have a lot of idle time and cover shorter distances.

“Then there are customers who are very aggressive in their carbon footprint reduction. Moving people to a motorcoach can take 56 cars off the road. Then if you electrify it, you have gone even further.”

In the immediate future, Cornell expects battery-electric coaches will be purchased by the “select customers” who are “early adopters.”

“We will see the demand increase as people see electrics have much of the same capabilities as the traditional coaches. We see a nice, steady demand growing over time,” he said.

Customer service

New sales programs helped ABC maintain momentum this year, Cornell said. “We have continued to see good demand in our new-coach sales, along with the pre-owned.”

Through “ABC Express” the company has positioned inventory of new Van Hools at its facilities in Winter Garden, Florida; Camden and Jersey City, New Jersey; Faribault, Minnesot; Grand Prairie, Texas; and Costa Mesa, California.

“We have inventory nearby as people need to pull new products in,” Cornell said.

ABC has addressed the challenges of selling pre-owned vehicles by categorizing them as base, plus or certified pre-owned coaches, each with their own pre-sell requirements. The latter have undergone detailed inspections, been repaired and upgraded for immediate service and carry a standard parts and service credit.

“That has helped customers who are shopping for pre-owned coaches to integrate into their fleets,” he said. “If they are looking for something that needs upgrades they can do themselves, they have that choice. The pre-owned market is more challenging than it has been, but we have listened to our customers in terms of their changing needs and put solid programs in place.”

For customers looking to upgrade coaches within their fleet rather than purchasing a coach, ABC has developed a number of aftermarket upgrade kits that can bring the exterior to look like the 2020 model year, again giving customers more choices when managing the lifecycle of coaches within their fleet, Cornell said.


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