“Electric buses will gain more and more market share”

Solaris’ View: Development & Perspectives of the European City Bus Market

Javier Calleja became CEO of Solaris Bus & Coach in 2018. He shared his view on the European city bus market in an interview with Urban Transport Magazine in January 2022.

UTM: We’d like to talk about how you see the actual situation and the foreseeable future for the European city bus market. Starting with the situation today: Is the pandemic still affecting the market in Europe or do you already see a clear recovery of the sales figures?

Javier Calleja: We are facing challenging times. There was a clear impact by the pandemic during the last two years – in 2020 and even more in 2021, with some delays in delivery of manufactured vehicles and especially in 2021 also in terms of order intake, as most operators were more cautious to invest given the drastic reduction in passenger numbers all over the place which still has not fully recovered yet. However, the coach market experienced a much higher impact by the crisis than the city and regional bus market. In recent months we have clearly seen a turn around. The market is catching up and order numbers are increasing to recover part of the “lost” investments the time before.

Solaris was able to continue with the bus production during the entire pandemic; bus production was not stopped one single day and we kept our business continuity. Nevertheless, supply of certain electronic components from sub-suppliers has a significant impact on the production for many months already.

Transforming the image of public transport is key

UTM: Everybody is talking about sustainability – and public transport is for sure a part of that trend. Do you think the modal split will generally shift towards more use of public transport, and if so, do you think this will particularly benefit the bus industry?

Javier Calleja: The answer is a straight “yes”. Yes, sustainability ranks very high on the agenda of politicians, administration and, of course, a vast majority of the citizens in Europe. And it’s not only a buzzword, but a general trend affecting the way we want to live in the future. Transport currently accounts for 23% of all emissions – this is an important issue to solve. Public transport is the key element to reduce the negative effects of traffic congestion and emissions. It became most evident that single individuals sitting and driving in individual cars are not sustainable in the long-run.

Public transport is a most viable alternative, and operators, traffic planers, but also the manufacturers of the vehicles and the visible infrastructure, play the most important role to foster the use of it – they all have a joint responsibility.

Key element in this transition is a transformation of the overall image of public transport, in order to attract more people and to steadily increase passenger numbers. The cleaner, better equipped and easier to use and to access vehicle is the more attractive one for the public. It simply provides a better experience for the passenger as customer. And this includes sustainability criteria which have become more and more relevant for many passengers. Sustainability is the most important criterium in favour of public transport use instead of your own car.

And one important point to mention here: The technology for a better, cleaner way of public transport and especially when it comes to city buses is already here, we don’t have to develop so many new technological solutions as in other sectors. We simply have to make wider use of it – also when it comes to bus technology.

The bus has a significant share in that, and improvements can be much easier done simply because it needs much less investment – it can help to raise the attractiveness of public transport in short period of time.

Elektric buses & trolley buses

UTM: Sustainability – for some people this automatically translates into electric mobility. What is your expectation about the electric bus market?

Javier Calleja: Sustainability of course translates into the way how and which energy source the vehicles use. Electric drives not only allow for a smoother ride, but their use of energy usually is much more environmental-friendly, especially reflected by lower energy consumption and less or even zero local emissions.

The trend towards electric mobility is clear, and is also clear that electric buses will gain more and more market share – at the expense of “traditional” diesel buses. This trend is most evident already in the city and regional bus market, less in the coach market.

UTM: Which technology will “win the race” – hybrid, pure battery, in-motion-charging trolleybuses, hydrogen,…?

Javier Calleja: We don’t expect a “winner” in terms of vehicles propulsion. At the end of the day every effort towards low and zero emission mobility is a winning one. Battery buses and hydrogen buses will be complementary for quite a while – they cover different needs and address different requirements of the operators and their networks. This refers to criteria like charging facilities and concepts, range, technical availability and not the least the overall investment needed, among others.

Trolleybuses are definitely a reliable, mature technology for operators of existing networks. Today, almost all of them (> 95%) have additional, powerful traction batteries on board – to cover longer stretches of routes “off-wire” without the need to invest in additional overhaead lines which contributes to the economics of the operations in favourable way.

Hybrid buses – in the medium-to-long run – we consider a bridge technology to facilitate the way towards wider use of full zero emission buses.

An articulated hydrogen bus is to come later this year

UTM: Will the traditional diesel bus become a niche product in the medium term? Or will it still play a significant role among the city buses also in 10 or 15 years time?

Javier Calleja: The trend to electric mobility is evident. However, diesel bus technology is well advanced and is still progressing and developing – mainly by improvements in terms of fuel consumption, emissions and level of noise. The diesel bus is not going to disappear any time soon, although its market share is decreasing. The diesel bus will find its role more and more in complementary services, where the operation of pure electric buses might not yet be economically justified (yet), and this definitely for several years more.

UTM: Talking about Solaris: You already have a strong position in some (national) markets – where do you see the biggest growth potential in the short-to-medium run?

Javier Calleja: We are present in basically all continental European national markets and we want to grow in all of them. Solaris vehicles operate every day in 32 countries in almost 800 cities. These numbers are increasing every year, and we want to continue this way.

Of course, there are some markets where we have stronger presence, like for example in Poland, Germany, Italy, Czech Republic, Baltic States and Scandinavian countries. In others like Spain, Norway, Austria or Switzerland we are growing very fast especially in low and zero emissions bus segments. And there are countries where we would like to significantly increase our presence in coming years, e.g. like in France.

One of our aspirations for the short-to-medium run is to become the absolute leader in the European e-bus market. Which by the way between 2012 and 2021 we have already achieved.

UTM: A last question: Is it true that Solaris intends to “streamline” its portfolio in a certain way and to concentrate less on niche products?

Javier Calleja: We are working to serve the customer in the best possible way, that’s for sure. This includes not only to address special needs and requirements of our customers but also the offering of products in certain niche market segments. However, we have to and will do it in a profitable way!

UTM: Thank you very much for sharing your thoughts with UTM!

Javier Calleja:

Javier Calleja has been appointed the CEO of Solaris Bus & Coach on 3rd October 2018. He has a broad business experience across multiple sectors, including transport industry, and leading high qualified teams. For 20 years Javier Calleja was a partner at Bain & Company, a leading global consulting company. He has deep experience with large transformations and operational improvement projects, across many geographies in Europe, and America. Before Bain & Company he worked at Roland Berger consulting company and Tecnicas Reunidas, which is the largest engineering company in Spain.

Javier Calleja is graduated with Master Degree Mechanical Engineering at University in Bilbao (Spain) and has Master of Business Administration title from INSEAD in France. Being a member of Spanish UNLTD, he supports development of various social entrepreneurs.

Javier Calleja was born in Spain. He is married and has two children.

Remarks: Thank you very much to Mateusz Figaszewski, Director of E-mobility Development and Market Intelligence of Solaris Group, for arranging and participating in this interview. die Organisation und Teilnahme an diesem Interview.