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Intercity Bus Service Gets No Respect from Government

Its ridership is twice the size of Amtrak, yet there is little in the way of public support to help bus travel get through COVID. As the once popular mode of transit continues to decline, some states are taking notice.

Idle Greyhound buses in New York City during the height of the pandemic.
Bus passenger MD Masood Karim is unfamiliar with the transportation offerings between the Northeast Corridor’s major cities, because this is his first time in the United States. Contemplating a trip between New York and Washington, D.C., the Bangladeshi government official took a friend’s advice and booked a ride on Megabus.

“I do not have sufficient knowledge of transportation, but I’ve enjoyed [Megabus],” said Karim, while waiting in line at Washington’s Union Station to board his ride back to New York. “It is very economical, very clean, and they are maintaining the proper time.”

Karim does have a few critiques. He found the seating somewhat uncomfortable, and during a violent thunderstorm the trip got a little moist.

“The rain water was falling in to some extent when I came from NYC to Washington, but otherwise the journey was fine,” he said.

The summer of 2021 hasn’t been the palliative the intercity bus industry hoped for after suffering a particularly bad pandemic. Ridership plummeted by over 80 percent as COVID-19 swept across the nation. But unlike the airline, rail or transit sectors, it did not receive any direct aid in either the Trump-era CARES Act or the Biden-era American Rescue Plan Act.

“The business traveler who’s riding an airplane has a bigger voice than somebody from a poor, rural part of the country who needs basic transportation,” says Peter Pantuso, president of the American Bus Association. “I always tell people, we’re like wallpaper, we just blend into the background. They just don’t think about us.”

For tens of millions of Americans, intercity bus companies like Greyhound, Megabus, and myriad smaller actors are an essential part of the nation’s transportation system. Pre-pandemic, the intercity bus industry carried more than double the passengers of Amtrak.

Intercity buses have long served as a lifeline to areas without train or plane service, and for riders who don’t have access to a car. It is an essential service for rural America, for students, and for low-income people.

But intercity bus travel has been in decline for decades. Despite a resurgence in ridership during the Great Recession, and a blossoming of direct express services like Megabus around the same time, the industry began shrinking again after 2015. The pandemic took a terrible toll too, elongating travel times, driving many smaller bus companies to the edge of bankruptcy, and pushing thousands of drivers out of their jobs.

The industry received a sliver of aid at the end of 2020. After months of aggressive politicking, where the American Bus Association hired additional lobbyists to press their case, direct federal support came in the December rescue package. It amounted to $2 billion to be split between school bus, motor coach, and passenger vessel operations (like whale watching companies).

Bus advocates say that further federal aid should be extended to their mode of travel, as it was for so many others earlier in the pandemic. Failing that, local and, especially, state policymakers could help to fill the gap.

“The national network is at risk of unraveling in ways that can really hurt mobility for disadvantaged groups, because there’s no other option between many cities,” says Joseph Schwieterman, professor of transportation at DePaul University. “It’s remarkable, given the emphasis on societal equity, that the mode most used by the poor populations was mostly overlooked. This really deserves policymaker attention.”

The Fallout of Deregulation

COVID-19 is only the latest challenge to the notion of a national bus network. At the peak of bus travel in 1970, 130 million passengers rode intercity motorcoaches. The Amalgamated Transit Union (ATU) had 23,000 members in its Greyhound local alone, and, with its handful of competitors, the company covered much of America. (Greyhound did not grant Governing an interview.) But then the industry was deregulated in the 1980s — part of a bipartisan wave of such action across the transportation sector — allowing consolidation, the elimination of unprofitable routes and the emergence of smaller companies.

Unlike the airline, trucking, and freight industries, however, deregulation did not spur a surge of new entrants or innovation. Instead, Greyhound gobbled up many of its big competitors while downsizing its operations. It then went bankrupt in 1990. By 2019, the transit union’s Greyhound local had less than 2,000 members.

“They’ve basically folded up the highways all over North America,” says Bruce Hamilton, vice president of the ATU and former head of its Greyhound local. “They ended up closing up thousands of stops and accelerated the demise of rural America. It’s been a real disaster.”

For the unions, the large and heavily regulated companies of the pre-deregulation era allowed for a more advantageous organizing and bargaining environment. Drivers were well-paid and enjoyed good benefits, standards that have declined in the decades since. The companies were also compelled by the federal government to run unprofitable and low passenger routes to rural areas and small towns (recall the cornfield where Cary Grant departs his bus in the film North by Northwest).

Today, very few operators are stopping on the side of a country road. Although Greyhound is still the largest motorcoach company, it is a shadow of its former self and the newer competitors that finally started to emerge in the 2000s were largely non-union.

Back in Washington’s Union Station, waiting for the Megabus to New York, Patrick Wu says that cost is the principal reason he rides. After a year with little travel, he’s ridden the bus three or four times in 2021 and finds it much the same as before. Affordable, reliable and uncomfortable, if a little less crowded.

“No one is riding for comfort,” says Wu, as he waits in the cavernous parking garage where intercity buses stop in the District of Columbia. “Buses are always the cheapest option. Almost as a universal truth compared to Amtrak and flight. For the most part my experience hasn’t been too bad, although it’s always kind of sucked.”

Fewer Routes, Fewer Drivers

Riders like Karim and Wu traveling between America’s largest city and its capital will always have options. Where bus service can really suck, or simply not exist at all, is in less-traveled corridors.

Schwieterman and his colleagues performed an analysis at the beginning of 2021 that shows the availability of bus service shrank radically during the pandemic. But the trend predates 2020. They found that the national network of bus lines that use Greyhound’s website — like Peter Pan, Indian Trails, and Greyhound itself — have been atrophying.

Between early 2016 and February 2020, Greyhound reduced its operations by 16 percent, eliminating lines like the one between Cincinnati and Chicago. Smaller operators’ service, via the larger company’s website, fell by 4 percent. The number of routes where travel time lasted beyond ten hours grew from 21 to 50.

Schwieterman’s research isn’t the only troubling sign. According to the American Bus Association, the larger industry shrank radically over the past 18 months. About a quarter of the companies that existed pre-pandemic lost their operating authority. Some may come back, ABA president Pantuso says, but most are gone forever. Hundreds of buses were repossessed, taken off the road, and are sitting in lots. (These numbers also include the charter and tour industry, which ABA also represents. They did not have a breakout of intercity companies alone.)

There’s a driver shortage too, as many bus workers either retired early during the pandemic or got new jobs with less COVID-19 exposure.

“We’ve always had a historical challenge finding drivers, as the trucking industry has,” says Pantuso. “But now it’s almost like another pandemic going on right now in the motorcoach industry.”

The demand side is a problem too. In a June interview, Schwieterman predicted that energy would return to the sector by late July. By Labor Day, 75 percent of pre-pandemic ridership levels would be back.

Instead, the delta variant hit. Now he says that the best estimate is 60 percent of riders have returned. (Real-time analysis is complicated because there isn’t federal data on how many people ride intercity buses.)

Express city-to-city services, which serve more populated areas like the Northeast Corridor or the big cities in Texas, are not back to capacity yet either. Megabus shut down service between New York and D.C. in April and May of 2020. They’ve been slowly building back service based on demand. Before the pandemic, they could forecast trends months in advance. Now the best they can manage is week to week.

“I would say that we are slowly coming back, going from very little or minimal services in some places to starting to basically rebuild the company,” says Sean Hughes, vice president of public affairs at Coach USA, which owns Megabus.

Government Begins to Take Action?

More federal aid is far from certain. The American Bus Association was told there would be no opportunity for aid in the infrastructure package or the reconciliation bill. Their best hope is a small package that U.S. Sen. Ben Cardin, D-Md., hopes to pass to aid industries still struggling from the pandemic fallout, like restaurants.

Help can come from lower levels. Bus advocates say that local officials can ensure riders have access to decent facilities. In many cities, express buses pick passengers up on city streets or in parking lots with no shelter. Greyhound stations often have a bad reputation, which is why the Washington stop was moved into the Union Station garage. (It says a lot that a non-climate controlled vertical parking lot is seen as a step up from the old locale.) Cities like Philadelphia have failed to provide any accommodations.

On a larger scale, some states have used public funding to create their own lines to fill the gaps left by receding private service. They are sometimes used to bring riders to Greyhound stations or Amtrak lines, which can also be bolstered with state funds, and branded in innovative ways to appeal to more riders. Successful state-funded bus services include the Virginia Breeze service or Bustang in Colorado.

“The most exciting thing that’s happened in terms of policy is the states have branded their intercity bus network to take it under their wings and fill in gaps with state funding,” says Schwieterman. “When state DOTs nurture the intercity bus industry, cool things can happen.”

There’s also the federal 5311(f) program, which is administered through the Federal Transit Administration and subsidizes losses in routes that connect rural areas to larger cities. The program has many caveats, however. The line has to lose money first, then companies are only subsidized for half the loss. It’s also left to the discretion of governors to determine if their state will participate, with the money allocated to other transportation programs if it is unused.

Such programs are minor compared to the supports provided to the rest of the transportation industry. The industry never saw the public intervention that surrounds rail and airline travel because, for the most part, both its riders and its operators are unheard in policy circles.

For now, what the industry really needs is more customers like Crystal Hedricks. As she lined up for her first Greyhound ride since the pandemic, she shrugged when asked why she was going back.

“I might as well do this all over again and get a feel for things,” she said, walking up the steps, surgical mask firmly in place. “I guess I’m just used to it.”
Jake Blumgart is a senior writer for Governing and covers transportation and infrastructure. He lives in Philadelphia. Follow him on Twitter at @jblumgart.
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