Environmental pressure in the fragmented markets: the rise and the fall of bus-makers in Poland

Abstract:

Environmental pressure in the fragmented markets:
the rise and the fall of bus-makers in Poland

Bolesław Domański, Krzysztof Gwosdz, Robert Guzik

Jagiellonian University, Krakow, Poland

boleslaw.domanski@uj.edu.pl

There are profound differences between passenger car markets and bus and coach manufacturing. The latter is characterized by the low-volume production, fragmented national and regional markets as well as relatively higher labour costs. Last but not least, the environmental pressure, especially in the domain of city buses, is greater here than in the car production now. Most of the developed countries enforce strict environmental regulations step by step. To make things more difficult for the producers, the requirements may differ among particular regions and even towns in a single country. Another important domain of the impact of public policies is public procurement law binding town governments, which are the main buyers of city buses. The implementation of new powertrain solutions makes it necessary to look for significant remodelling of bus platforms and bodies, e.g. pursuing weight reduction. Hence design competences and strategic thinking are vital at the time of general uncertainty.

In Central and Eastern Europe, Hungary used to be the top manufacturer of buses in the socialist era. However, it has by and large lost its position with the advent of capitalism. The strong competition from the brand-name West European producers and the volatile domestic markets resulted in the collapse of the two major former state-owned bus-makers in Poland too. At the same time, new producers have arisen including foreign investors, for example Volvo, MAN and Scania, as well as newly-established indigenous manufacturers. Their expansion has made Poland the third largest bus and coach producer in Europe (behind Germany and Sweden) and the second major European exporter (behind Germany). It is interesting that the indigenous bus-maker Solaris is a major manufacturer of hybrid buses now and the most advanced in the development of new ‘green’ buses for the West European, especially German, market.

The authors explore the differences in the strategies and capabilities of foreign and domestic bus-makers located in Poland. The aim is to reveal factors behind their current strategies and future prospects, with special emphasis on flexibility, design competences, cost and quality issues.