JENNINGS, Kan. With less four years in the motorcoach market, Bus and Coach International is still the new kid on the block. But to solidify its position as a new-coach supplier, it has positioned itself as an innovator, bringing new systems and features to its buses and the industry.

Soon after it introduced itself and its Chinese-built BCI Falcon 45 coach to the industry at the 2007 United Motorcoach Association Expo in New Orleans, BCI began doing things many of the major builders were just thinking about.

It made passenger seatbelts, anti-collision radar and adaptive cruise control standard equipment on all of it coaches, and it strengthened the roofs of its buses so they met tough European standards for rollovers.

It also made leather passenger seats and adjustable ergonomic driver seats standard as well, and it cut a deal with national auto parts giant NAPA so the most frequently used parts could be purchased at many of its retail stores.

BCI has more in store for this year, but wont talk about it until this months UMA Motorcoach Expo in Las Vegas, says Larry Brennan, executive vice president.

"We wont talk about other innovations coming out this year because the company wants to generate some interest at the Expo booth, and we think more people will stop by if we hold off on announcing everything before the show," he said.

He did acknowledge, however, that an upgraded 2010 Falcon 45, powered by an International MaxxForce engine and Caterpillar transmission, will be on display at the show.

The 13-liter MaxxForce built by Navistar is the only engine that will be offered in 2010 that does not use selective catalytic reduction, or SCR, technology to reduce nitrogen oxide emissions. Instead, it uses an upgraded exhaust gas recirculation system, or EGR technology, to cut pollutants.

The SCR system, which uses urea-based diesel exhaust fluid to reduce emissions, requires installation of a storage tank and an injection system, as well as extra piping and after treatment equipment. Instead of using urea, the EGR method reduces emissions by allowing exhaust gas to enter the intake manifold where it dilutes the air and fuel mixture.

"The MaxxForce does not use urea, which is consistent with our philosophy of reducing operating costs," noted Brennan.

Thinking savings

He said the Caterpillar CX31 transmission used in the Falcon 45 is optimized for fuel economy, which should be welcome news to coach operators battling higher fuel costs.

BCI this year also will shed its image as being one of the last builders marketing non-stainless steel coaches in North America. Buyers of 2010 models will have for the first time a stainless steel option.

"Besides a new-for-2010 power train, our Falcon 45 incorporates many lessons learned over the last four years and tens of millions of miles in fleet operations across the United States," said Brennan. "We are excited to share these product improvements and other developments in Las Vegas."

He said Motorcoach Expo has become important to BCI because it offers the company that opportunity to learn about the industry and helps operators understand how BCI coaches can address their needs.

Like other manufacturers, both large and small, BCI has tried to face down the sour economy so it can remain healthy enough for the rebound when it comes.

"Weve had to cut some costs, increase efficiencies, and have not been able to expand as rapidly as we had hoped into new markets and new products," said Brennan. "But we believe that, just as with our customer base, the measures the economy has forced us to take will make us that much better-positioned to take advantage of positive economic developments and opportunities."

Credit challenges

He said the toughest challenge during the downturn has been the lack of available credit for operators who want to continue to upgrade their fleets with new coaches.

"Businesses that had all of the available credit they could use two years ago are finding money much scarcer now," he noted. "But weve managed to stay healthy in a down market, so that bodes well for the upturn that we all know will occur eventually and hopefully soon."

Brennan said changing government regulations have presented challenges as well and it requires constant vigilance to keep up.

"We are all watching the regulators very carefully and must ensure that our products not only meet or exceed important standards, but also permit the flexibility to address future standards not even implemented yet," he said.

He pointed out that BCI has already proved it is up for such actions because it was the first to provide passenger lap belts on its coaches even though no U.S. standard had been set.

"We had to ensure that our product line was engineered to meet the tougher of the then-articulated standards so we would comply with the expected U.S. standard when announced," he added.

Business challenges

The economy and government regulations havent been the only challenges BCI has faced during the past year. It lived through a high-profile company sale that never came off and lost one of its top executives in the midst of the acquisition attempt.

In May, the Canadian merchant bank SKANA Capital Corp. announced it had reached an agreement to acquire BCI. Six months later, after the stock sale agreement was altered twice, SKANA and BCI called off the purchase with the merchant bank saying it wanted to refocus on resource-based opportunities.

"The bank said it wanted to stay with its main core of business and if you look at their core, it was not in operating companies and not in managing and developing transportation businesses," said Brennan.

At about the same time the sale went sour, BCI received a management jolt, losing its chief operating officer, Chad Dixon, who left the company to become COO of Coach America in Dallas.

"It was sad to see him go and we are going to miss him," said Brennan. "But maybe our paths will cross again."

In the past year, BCI also adopted a major reconfiguring of its nationwide sales and service operation. It pared down its repair facility in Las Vegas and transferred the operation to Orlando where it has a major service center that includes a pre-delivery inspection operation and warehousing.

"As operators continue to purchase our products on the East Coach, we found it necessary to shift there," said Brennan. "We do not have a factory in the U.S. and are not bound geographically to a certain location, so we can take advantage of the opportunity to be anywhere."

Eying expansion

He said the company now is looking for locations to build sales and service centers later this year in the northeast and in Southern California, probably in Orange County near Los Angeles.

BCI currently operates a service center in Kansas and has smaller repair operations in San Francisco, Chicago and Salt Lake City.

There could be more challenges coming, too. According to reports circulating in the industry the company is looking for another manufacturer in China to build its buses.

Brennan called the talk "interesting rumors," but would not confirm or deny them. "We have strong a relationship in China and have more than one relationship, just like I suppose other companies that are involved in China do," he said.

Meantime, the company is looking ahead and sees many opportunities down the road.

Long term, according to Brennan, demographics, fuel costs and environmental awareness will play a key role in the future development of motorcoaches and how they are used.

"The big challenge will be to educate the public on the benefits of our industry," he said.