Shoddy school buses and appalling road safety records in China and other emerging economies could spell big opportunities for U.S. school bus manufacturers like Navistar.
In April, Navistar announced a partnership with Chinese truck maker JAC, with Navistar set to share safety expertise and best practices in the design and development of new school buses in China.
About 1.3 million people die each year as a result of road traffic accidents and over 90 percent of the world’s fatalities on the roads occur in developing economies, even though these countries have less than half of the world’s vehicles, according to the World Health Organization (WHO).
Last year, as a result of these alarming statistics, the United Nations in collaboration with the WHO launched Decade of Action for Road Safety (2011 to 2020). The resolution focuses on road safety in 100 countries and includes recommendations for transport planning and improved safety features on vehicles.
Much of the WHO’s focus is on vulnerable regions such as China, India, Africa and Brazil.
In India it’s estimated that 13 people per hour die in road traffic accidents, making this one of the top causes of death in the country. Even more disturbing, many of these accidents involve children. Earlier this month two were killed and 51 injured in India-controlled Kashmir when a school bus fell into a gorge.
Accidents like this are all too common in India where drivers hold bogus licenses and operate poorly maintained, sub-par vehicles.
China’s track record is just as shaky. This week, the head of a Chinese kindergarten was sentenced to seven years in prison for a school bus crash that killed 19 children and two adults last year. The makeshift school bus had been converted from a nine-seat freight van, but was carrying 64 people at the time of the accident.
In December, a bus returning students home from a primary school in rural China rolled into an irrigation canal, killing more children.
As a result of these accidents and the public outcry which ensued, China’s promised to crack down on substandard school transportation. New rules lay out the safe operation of school buses, including a mandate for local school districts to hire full-time bus maintenance crews and a requirement that buses must be replaced after eight years or about 125,000 miles.
China’s new buses will be required to have a “sealed” safety cage protecting the driver and passengers, with the engine extending in front of the windshield, an elevated passenger cabin, and strict capacity requirements to ensure vehicles aren’t overloaded. Bus makers have 13 months to comply with the new standard.
The Chinese plan to spend 463 billion yuan ($72.7 billion) over the next decade on transportation equipment and upgrades for its school system. It’s expected that part of that budget will be used to buy 50,000 yellow buses annually by 2015 Navistar told Bloomsberg Business Week last week.
Navistar makes about half the school buses sold in the U.S., which, according to the National Highway Traffic Safety Administration, is the safest form of transportation in that country. Each year about seven children are killed in school bus crashes, or 0.2 deaths for every 100 million vehicle miles, compared with 1.5 deaths for cars.
“Navistar is excited to be sharing our experience and school bus safety expertise with China and we look forward to additional opportunities in the future,” said John McKinney, president, Navistar Global Bus Group.