In two of my earlier posts I discussed FlixBus in context of "role of policy makers" and of "role of digitalization and innovations" in boosting sustainability in the Indian intercity bus transport services. This post aims to understand two key questions - What has been the impact of FlixBus service on the intercity bus transport business in India? What further actions are required or are being taken by the company, the policy makers in India, and other stakeholders in this sector for boosting the sustainability further?
FlixBus India's Senior Manager, Public Affairs and Corporate Communications Jit Banerjee took time from his busy schedule to answer my questions in an interview in this regard. An expert in public policy, he has several years of experience in consulting, and sectors including manufacturing and mobility. As a sixth employee in the firm he, along with other colleagues contributed significantly in launching the FlixBus services in India in February 2024.
Flix, a leading global travel-tech platform, successfully launched its FlixBus service in 46 destinations across north India in February 2024 [1] . In September 2024, FlixBus expanded in south India, thereby now connecting 101 cities and 215 stops nationwide [2].
ANURADHA JAIN:Â Jit Banerjee, what key factors/favourable conditions made this transition possible? What structural impact, in your view, has this had on the Indian travellers?
JIT BANERJEE: There are several factors that made this transition possible. The top three factors that offer FlixBus growth potential are, firstly, the size of the bus market in India, it’s the second largest market after China. Further, the need for air-conditiond (A/C) market and premium travel that the FlixBus addresses is between 3-4 billion USD. Secondly, the rail connectivity in India is poor and there is a mismatch between demand and supply. On the other hand, the airline services are not affordable for everyone. Positively for bus services, the intercity road infrastructure is improving. Thirdly, the consumer spending power in India has risen. In particular there is a growing demand for better quality bus services in Tier 2 and Tier 3 cities (classification of cities). FlixBus here offers an affordable and environment friendly premium bus service to the Indian customer that did not exist earlier.
Source: Anuradha Jain
In terms of impact, FlixBus provides consistency to its customers. The airlines can be distinguished from each other; while their services across airlines are standardized. But this is not so for bus services in India. Example, while travelling with Indigo airlines no one thinks about ticket booking, check-in services being different. Across different Indigo flights, the look and feel of the seats, dress code of the personnel etc is same. FlixBus is bringing such a transition in the Indian bus travel industry. Earlier there was no way of distinguishing bus services. There was either a non A/C or simple A/C bus. With the right vehicle specification across all high-quality OEMs (Original Equipment Manufacturers) and bus body builders that we work with (such as Volvo, Ashok Leyland, SM Kannappa) and standards we ensure the same look and feel for the buses and passenger amenities for the ease of our customers.
Entering a new market requires overcoming challenges. FlixBus present in over 40 countries worldwide, has experience in this area. What 2-3 challenges, in your view, did FlixBus experience in India? How did FlixBus overcome these challenges?
Our key challenges are linked to infrastructure issues, the consumer behaviour and the unlevelled playing field in the road transport industry. With regards to infrastructure, the departure points are an issue. It is hard to gain access to public infrastructure. The interstate bus terminals (ISBT) are not open to private sector, but with regular stakeholder interactions, a change is now gradually coming in. Then there are congestion issues that need to be dealt with (discussed later). Secondly, the consumer behaviour in India is different. Calls to our customer support, due to their current bus travel experience, is very high, as the customers feel it necessary to contact and confirm even basic information available on the tickets. This had a huge impact on our resources. We have used technological innovation e.g. by introducing an AI Chatbot which provides the basic information mentioned on the ticket, the location of departure point etc. Furthermore, we use the localising technology to provide continuous information on traffic and delays. Thirdly, with regards to unlevelled playing field, for private sector in the road transport industry, this is linked to issuing of permits. The government primarily issues stage carriage permits to state road transport authorities run by the states. The private players run their bus services on either a contract carriage permit or an All India Tourist Permit (AITP). Currently, we are interacting with the related authorities on a regular basis to ensure that the existing lack of clarity in the AITP rules regarding their alignment with intercity multi-stop bus operations is addressed.
How does FlixBus ensure punctuality of its services in India?
Our operations team follows a strict protocol (including departing on scheduled time) in getting the bus ready. For example, a direct intervention by passengers towards a bus driver to wait for few more minutes is not possible. This has a significant impact on the punctuality in arrival time. Furthermore, it also helps in reducing congestion.
Flix has expanded its services and its network coverage, e.g. now to southern India (33 cities, more than 200 connections [3]). What distinguishes the northern and southern Indian markets? What changes had to be made in the FlixBus business model for this purpose?
There are differences between the two markets. The southern market is more organized; hence consolidation has taken place. There is better technology adoption, which for FlixBus, a travel tech company, is an advantage. Importantly, there is availability of talent. People are keen for a job opportunity in FlixBus. As for the business model, we did not have to make changes as such. FlixBus is an asset light company that collaborates with local bus operators, this model is also applied in northern and southern market in India.
In its aim towards becoming the country's leading service provider, FlixBus is extending its collaboration with the Indian operators. For e.g. with Universal bus services, Jagan travels, Anne Travels, Jai Shree travels and Varun travels. Recently it announced its partnership with Abhibus, a bus ticketing service provider. Given the significant competition amongst the bus services (3500 operators, 25 Regional Transport corportations), where/how does FlixBus offer a better value proposition to its potential customers?
Our biggest value proposition is our propreitary technology platform. It offers data intelligence e.g. on network, track and trace etc. which enables us to assess and penetrate the market for growth in a highly focussed way. This requires resources and capabilities that may be challenging for especially small service provider to quicky organize such finances and develop capabilities. It is easier for them (the service providers) to collaborate with us and use the platform instead. It is a win-win situation for all sides. Our capabilities include a trained and better-behaved staff, and an online booking system that enables booking a ticket in only 3 clicks. Importantly, the customers while booking can choose their seats, hence, they know where they will be sitting/sleeping. Offering A/C sleeper buses, waiting lounges and other amenities, contributes to an overall better customer experience.
In terms of communication, regional operators as partners possibly aid in providing services in local languages. In my understanding, currently for India, online booking is available only in English (also on Abhibus). Sources [4] estimate that currently there are 696 million mobile users in India (400 million utilise internet) and the next half 500 million mobile users by 2025 will comprise people who do not wholly understand English. How does FlixBus plan to digitally include/engage this customer base?
We have just begun our journey in India and we are already in the process of localising our services. However, this will take time as we are focussing on the customers and extending our services today. If you go to Flixbus.in today, you will already note the English in language selection marked with an Indian flag. Importantly, our service staff speaks the local language i.e. it covers ca. 4-5 Indian languages. This also applies to those working in traffic control.
Contributing to India's sustainability goals, FlixBus continues to expand the use of buses in India. What % of the buses (operated by FlixBus and its partners) today are electric and hydrogen vehicles? What further initiatives is FlixBus taking in this regard?
Our fleet consists of BS VI compliant* diesel buses. Electric buses have been introduced by FlixBus in pilot projects around the world. Such buses require adequate charging infrastructure which is coming up on Indian highways, however it is not yet such that we can offer the same customer experience to our travellers (discussed later). Our first focus in India is network coverage while continuing to provide convenient, ecofriendly and competitive service quality. Â
*strict Bharat stage emission standards (which largely parallel Euro-6/VI norms) laid down by the Indian government to regulate the output of air pollutants from internal combustion engine and spark-ignition engine equipment, including motor vehicles [5].
In FlixBus’s plan to further cover Tier 2 and Tier 3 cities, what changes must be made to accelerate the setup of charging infrastructure? What initiatives is FlixBus taking in this regard?
First, the charging infrastructure needs to expand. The government is trying to understand this need better and there is progress on highways in this direction. One requirement (to accelerate the setup of charging infrastructure) is to ensure a higher access to private operators in the government bus depots. For example, we (with focus on intercity bus transport in the night time) can now access the facilities of DTC (Delhi Transportation Corporation responsible for intracity bus services during the day time) bus depot. This is a win-win situation for all sides. Second, the OEMs are building new products, more visibility needs to evolve in this regard. Today an EV bus travelling on a 600-800Kms (e.g. Delhi to Gorakhpur) route will need to at least stop mid-way to charge. The recharging of the battery would take between 45 minutes to one hour. This cuts into the customer experience, as they would have to wait during night travel. Thus, further developments in fast charging is a must. Third, a debate is required for harmonizing policies between the centre and the states with respect to more seamless availability of the charging infrastructure.
FlixBus's value proposition, amongst others, is its environment friendly bus, optimized routes and efficient driving techniques. Is there a difference between maintenance strategies applied e.g. in Europe and in India (challenges due to dust, pollution...)? How does FlixBus ensure these guidelines across all partners?
In our starting phase we currently rely on our bus partners who are responsible for operations including the maintenance. We make sure that we select the best fleet owners who typically do a good job in maintaining their buses. Further, we undertake regular audits to ensure compliance to our standards. This includes looking into the telematics data. Further developments will take place over time as we expand and collect more data in this regard.
Whereas safety of the traveller in bus transport is ensured, challenges still remain in e.g. late night travelling to the FlixBus bus stop or lounge. What changes in your view can be brought in in organizing door to door safe travel in India?
At macro level the government has to start recognizing that this need is a part of the solution and not a problem. Empowering buses with technology in this direction is not enough. Clarification with regards to regulations for private operators e.g. in creating more suitable lounge infrastructure for waiting and increasing the access to public infrastructure is essential to attract foreign direct investments. Positively, the investors are interested in the Indian market. This would make the bus services more accessible to the public, hence improve safety. At local level, more cooperation from law enforcement authorities, traffic regulators and RTC’s with private operators is required to develop infrastructure, improving A/C travel, selection of departure points, highlighting issues etc. Â
What future skills/talent do you think need to be developed further to push EV transitions in bus (collective) transport in India further?
In the time to come specialized skills to plan infrastructure in this regard and raising investments will be required. The minimum investment for acquiring and operating E-buses is very high. The current policies are favourable for STU’s (state transport undertakings) but no subsidies are provided to the private sector.  Although charging infrastructure is coming up on the highways, challenges in setting up charging stations exist. Hence the market is not yet EV-transport ready.  Tangentially, private operators like FlixBus can be consulted in improving the environment friendly, air-conditioned bus travel, in selecting the right departure points, highlighting congestion issues etc. In airline industry tech operators are regularly consulted in this regard. This should also be possible in the bus transport industry. However, currently such operators are too small and are not in the position to influence, respectively bring a change in policies at state or national level. The government can forge setting up charging stations by bringing electricity distribution companies and private sectors together. Further, provide subsidies and incentives to private operators investing into E-buses. A regulatory body dedicated to the road transport sector could ensure better harmonisation of regulations for the bus sector.
Interview published on 08.10.2024
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