Public Transportation Market

Market Overview

The global public transportation market size was valued at USD 248.13 billion in 2024. It is expected to reach USD 372.23 billion in 2032, growing at a CAGR of 5.71% over the forecast period (2024-32). Many governments are investing in public transportation infrastructure to improve connectivity, reduce traffic congestion, and enhance urban mobility. This includes funding for new infrastructure projects and subsidies for public transport services.

This has eventually succeeded in providing commuters with a service that is not only safe and comfortable but also convenient. The public transit industry includes businesses, institutions, corporations, and organizations that run regional and local passenger transportation networks with regular routes and schedules. Due to the significance of urban infrastructure in providing services to and assistance for most urban residents, the urban public transportation system comprises public buses, electric buses, subways, taxis, auto-rickshaws, ferries, and other forms of public transport vehicles. The mission of public transportation reflects its essential function in an intricate transportation network. Public transportation may give individuals both inexpensive and secure mobility, encouraging a healthy environment and thriving metropolitan areas.

Market Dynamics

Global Public Transportation Market Drivers

Increasing Demand for Public Transit in Megacities to Aid Growth

The robust expansion of economies worldwide is a crucial factor propelling the market. In recent decades, there has been a rapid increase in the movement of people into urban areas and the growth of urban and metropolitan areas. According to the data compiled by the United Nations, around 55 percent of the world's population lived in urban regions in the year 2018. It is anticipated that this percentage will increase to 60 percent by 2030. The market's growth may be ascribed to the expansion of global infrastructure and the progression of technology. Numerous governments are constructing bus rapid transit, metro, monorail, and light rail transit systems to meet the demand for public transportation in megacities. As a result, more people are using public transportation, causing the market to grow.

Global Public Transportation Market Restraints

Rising Preference for Passenger Vehicles and Motorcycles for Commuting to Hinder Market Growth

The growing preference of commuters for passenger vehicles and two-wheelers is restraining the sector's expansion. Two-wheeled carts are the primary mode of transportation for those in the middle class in developing countries like India, Vietnam, and Bangladesh. In addition, the expansion of the global market is hampered by political regimes that are biased against investments in public transit. The spread of the Covid-19 outbreak substantially impacted the expansion of the public transportation business worldwide. As a direct consequence of the widespread dissemination of the COVID-19 virus, commuters opted for private and personal modes of transportation, which led to a steep drop in the utilization of public transportation.

Regional Analysis

The global public transportation market is segmented into four regions, namely North America, Europe, Asia-Pacific, and LAMEA.

Asia-Pacific will be the most dominant region in the global public transportation market during the forecast period. The existence of public transportation networks in Japan, China, and South Korea that are well developed and reasonably priced has helped to make the expansion of the regional market possible in part. In addition, the area is home to a sizeable population classified as having a middle-income and relies on public transportation for their daily travels to and from work. This also contributes, albeit a small one, to the expansion of the market in the region, but it is not very significant.

The Middle East and Africa grow at a CAGR of 6% during the forecast period, placing them as the region with the second-highest growth rate in the world. It is anticipated that the regional market's growth will be bolstered not only by increased expenditures and investments made by the government but also by initiatives carried out by the government. For example, the Gulf Cooperation Council (GCC) authorities are working toward improving public transportation by merging metro and BRT systems into a unified network.

Segmental Analysis

The global public transportation market is segmented by distribution channels and modes.

Based on distribution channels, the market is divided into online and offline. The offline channel segment dominates the market during the forecast period. Offline is a tried-and-true method that businesses and individuals have used successfully for years. Many participants and customers utilize the offline distribution channel to purchase tickets for public transportation, particularly in developing countries. It is anticipated that the market for internet services will expand at a CAGR of 8.9% during the forecast period. The expansion of internet services, the falling price of smartphones, and an increasing reliance on digital solutions are all factors driving the growth of this market segment. It is projected that the tech-savvy members of Generation Z and millennials will constitute most of the commuter population.

Based on mode, the market is divided into road and rail. The road section is the most lucrative part of the global public transportation market. The broad availability of the road transportation system and the growing usage of the system are key factors contributing to the category's expansion. Installing bus rapid transit systems in megacities worldwide helps expand the road network and strives to provide more adaptable, reliable, and speedy transit. This is because of the growing demand for faster, more reliable, and more convenient modes of transportation.

The growth is primarily driven by rising expenditures and investments in constructing the necessary infrastructure for rail transportation, most notably the expansion of the metro and light rail transit systems. It is anticipated that the global market for rail transportation will display a healthy compound annual growth rate (CAGR) of 6.3% between 2022 and 2030. The growth is primarily driven by rising expenditures and investments in constructing the necessary infrastructure for rail transportation, most notably the expansion of the metro and light rail transit systems. For instance, in the country of India, there are currently a variety of different metro construction projects that are being built. The Pune Metro, the Patna Metro, and the Ahmedabad Metro are all projects that fall within this category.

Recent Developments

• July 2024 - Moving Tech, the company behind India's most popular community-led mobility apps like Namma Yatri, Yatri Sathi, Yatri, and Mana Yatri, raised USD 11 million (₹92 Cr) in a pre-Series A funding round led by Blume Ventures and Antler. Google and other investors also took part in it. With this investment, Moving Tech starts a new phase in its goal to give drivers more power, connect public transportation, and make it easier for people to commute.
• July 2024 - The Federal Transit Administration (FTA) of the U.S. Department of Transit announced plans to fund nearly USD 1.5 billion for 117 projects that will enhance public transit in 47 states.