Ger­many’s FlixBus to take on Grey­hound in the US

Jerusalem Post - - BUSINESS & FINANCE -

FRANK­FURT (Reuters) – Ger­man long-dis­tance bus firm FlixBus plans to ex­pand to the United States next year, tak­ing on ri­vals such as Grey­hound and Me­gabus from a base in Los An­ge­les, it said on Wed­nes­day.

“There is a sig­nif­i­cant shift in the Amer­i­can trans­port mar­ket at the mo­ment,” FlixBus founder and man­ager An­dre Sch­waemm­lein said in a state­ment. “Pub­lic trans­porta­tion and sus­tain­able travel is be­com­ing more im­por­tant.”

FlixBus be­came a ma­jor player on Euro­pean long-dis­tance routes after Ger­many lib­er­al­ized the mar­ket for in­ter­city bus ser­vices in 2013.

It sur­vived a fierce price war among new mar­ket en­trants to boost its mar­ket share in Ger­many to more than 90%, mak­ing its bright-green coaches a com­mon sight on Ger­man high­ways. It does not own any of the buses, but rather works with lo­cal and re­gional part­ners.

In the United States, it would com­pete with com­pa­nies such as Me­gabus, op­er­ated by Bri­tain’s Stage­coach Group, which launched in the US in 2006, and the fa­mous Grey­hound bus line.

Grey­hound, founded in 1914 and now owned by Bri­tain’s FirstGroup PLC, trans­ports some 18 mil­lion pas­sen­gers a year in a fleet of about 1,700 ve­hi­cles.

FlixBus said it had al­ready sent a small team to Los An­ge­les to start set­ting up a base for its US busi­ness, though it was not yet clear when and on which routes it would start its bus ser­vice there.

It may face an up­hill bat­tle in the US, where ex­ist­ing bus com­pa­nies and the Am­trak rail­way sys­tem are com­pet­ing for trav­el­ers with air­lines and per­sonal ve­hi­cles.

Re­searchers at the Chad­dick In­sti­tute at DePaul Univer­sity in Chicago in Au­gust is­sued a re­port say­ing that cheap gaso­line was en­cour­ag­ing trav­el­ers to drive cars be­tween cer­tain cities that are 120 to 400 miles apart, leav­ing gaps in the bus and rail net­works.

The Chad­dick In­sti­tute has since with­drawn that study. Am­trak has re­ported the sys­tem’s rider­ship in­creased to 31.3 mil­lion pas­sen­gers in the 2016 fis­cal year, from 30.9 mil­lion in the 2015 fis­cal year.

An Am­trak spokesman said the sys­tem ex­pected to show an­other in­crease in rider­ship and rev­enue in fis­cal 2017.

(Arnd Wieg­mann/Reuters)

PAS­SEN­GERS WALK to­ward a FlixBus in­ter­city bus at a bus sta­tion in Zurich, Switzer­land, last year.

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