Apr 17, 2019

The evolving electric bus market

A new electric bus in Berlin. Photo: Adam Berry/Getty Images

U.S.-based electric bus maker Proterra is partnering with Japanese investment firm Mitsui to expand a program that slashes buyers' upfront costs — by allowing them to lease instead of buy the vehicle's battery, which is a major expense.

Why it matters: It's part of the wider evolution of the growing electric bus industry.

  • "There are a lot of innovative models coming up around EV buses in particular. Upfront costs are still high, but there's a growing number of ways to get around that," Colin McKerracher of the consultancy Bloomberg NEF tells Axios.
  • "Municipal buses will probably go electric faster than any other major vehicle segment," he said.

Driving the news: Mitsui is putting $200 million behind Proterra's leasing program in an effort to speed up North American sales growth. The 12-year leases include performance warranties and midlife replacement.

  • "The battery leasing credit facility, the first of its kind in the North American public transit industry, is expected to lower the upfront costs of zero-emission buses and put Proterra electric buses at roughly the same price as a diesel bus," the companies said.

The big picture: Electric buses are competitive with internal combustion models over time, thanks to the absence of diesel fuel costs.

  • But they're more expensive on the front end.
  • And, the vast majority of deployment is in China.

By the numbers: Proterra CEO Ryan Popple, whose company largely serves U.S. transit agencies, tells Greentech Media that leasing immediately ends the gulf between a $500,000 diesel bus and a $750,000 electric model.

  • “On a percent basis, it takes the upfront premium for an electric bus from 50 percent to zero,” he said to Greentech.

The Proterra-Mitsui venture is the latest move in financing. Last year, bus maker BYD teamed up with Generate Capital to launch a programthat enables leasing of electric buses.

  • "The area where it's unique is Proterra and Mitsui have segregated the upfront cost and associated risk of the core differential on electric vs. diesel or [compressed natural gas] buses, which is the battery itself," Wood Mackenzie analyst Ravi Manghani tells Axios.
  • "This approach mitigates the inherent hesitation of electric buses and makes the sales cycle mimic that of traditional buses," he says.

Go deeper: Electric buses are having a moment

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Deadly clashes erupt in Delhi ahead of Trump's visit

Rival protesters over the Citizenship Amendment Act in Delhi, India, on Monday. Photo: Yawar Nazir/ Getty Images

Delhi Chief Minister Arvind Kejriwal called for calm Tuesday as deadly clashes erupted in the city's northeast between supporters and opponents of India's controversial new citizenship law.

Why it matters: Per the BBC, a police officer and six civilians "died in the capital's deadliest day" since last year's passing of the Citizenship Amendment Act — which allows religious minorities but excludes Muslims from nearby countries to become citizens if they can show they were persecuted for their religion — hours before President Trump and members of the U.S. first family were due to visit the city as part of their visit to India.

Go deeper: India's citizenship bill continues Modi's Hindu nationalist offensive

South Carolina paper The State backs Buttigieg for Democratic primary

Democratic presidential candidate and former South Bend Pete Buttigieg speaks at an event in Charleston, South Carolina on Monday. Photo: Win McNamee/Getty Images

South Carolina newspaper The State endorsed former Southbend Mayor Pete Buttigieg on Monday night for the state's Democratic primary.

Why it matters: It's a welcome boost for Buttigieg ahead of Tuesday's Democratic debate in South Carolina and the state's primary on Saturday.

White House requests $2.5 billion to fight coronavirus as U.S. cases rise

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's Health Ministry. Note: China numbers are for the mainland only and U.S. numbers include repatriated citizens.

The Trump administration sent a letter to Congress Monday requesting a funding commitment of at least $2.5 billion to help combat the spread of the novel coronavirus, as the number of confirmed cases in the U.S. rose to 53.

The big picture: As South Korea and Italy stepped up emergency measures in efforts to thwart the spread of the virus, WHO expressed concern about infections with no clear link to China. COVID-19 has killed at least 2,699 people and infected more than 80,000 others, with all but 27 deaths occurring in mainland China.

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