The Motorcoach Industry’s Call to Action

May 19, 2020 | DTJ Online

More than 600 motorcoaches from across the country descended upon Washington, DC, on May 13 to call attention to the importance of their industry to the economy and in keeping America moving. Buses have been hit particularly hard by the COVID-19 pandemic, yet have remained largely overlooked by federal relief funds.

According to a report by the American Bus Association (ABA), between 80 and 95 percent of motorcoach trips have been canceled or are simply not being booked due to the pandemic. March through June is generally the industry’s busy season when approximately half of all revenues are earned. However, regular group travel customers—schools and colleges, summer camps, marching bands, sports teams, senior’s groups, tours, conferences, scheduled and commuter services, and the US military and government—have virtually disappeared since the onset of the pandemic.

The report estimates that as many as 82,040, or 92.4 percent, of the jobs in the industry could be lost should the pandemic to continue through the end of the year. If that were to happen, the industry would produce $14.2 billion less in sales, and the charter and special services businesses would be devastated. Even if the industry is able to return to pre-COVID-19 service levels by the end of May, it faces losses in the range of $4.7 billion and an annualized loss of 27,350 jobs for the year.

Ready to Roll
This week’s “rolling rally” was comprised of independent operators, industry suppliers, and state associations represented by a joint initiative between the ABA and the United Motorcoach Association (UMA).

Buses displayed signs about the industry, such as “36 Cars Removed From the Road by This Motorcoach.” Some signs described the many groups the industry serves, such as “Motorcoaches Move America’s Athletes” and “Motorcoaches Move America’s Youth.” But, perhaps most poignant were signs touting their economic impact and employment statistics. Many buses provided information specific to their state, like one motorcoach from Alaska with a sign that read, “8.5 Million Visitors, 5,300 Jobs, $6.2 Billion Impact.” Other buses provided industry-wide numbers, “100,000 Jobs at Risk, $8 Billion Lost Revenue.”

From the beginning, organizers promoted the rally as a positive event aimed at showcasing how the big buses and small businesses move America. Reactions from attendees and supporters appear to agree with this sentiment, who expressed hope the event garnered enough attention to make a difference.

Assistance Needed
The group’s efforts to have their voices heard have not been limited to the rally. The ABA and UMA have encouraged members to communicate with their state governors and congressional representatives. Their goals are to convey the importance of the industry, the dire circumstance the pandemic has created, share the stories of the many people being affected, and ask for federal assistance.

While there is still a long way to go, it appears these efforts are starting to gain traction in Congress. At the beginning of the month, House of Representatives Ways and Means Committee Chairman Richard Neal (D-Massachusetts) and Transportation and Infrastructure Committee Chairman Peter DeFazio (D-Oregon) sent a letter to Treasury Secretary Steven Mnuchin and Federal Reserve Chair Jerome Powell urging them to provide support for the motorcoach industry. Senators Susan Collins (R-Maine) and Jack Reed (D-Rhode Island), respectively the Chairwoman and Ranking Member of the Senate Appropriations Subcommittee on Transportation, also sent a letter to Secretary Mnuchin for asking for assistance and guidance for the industry.

The industry is requesting $15 billion in assistance, consisting of $10 billion in grants and $5 billion in loans, along with modifications to programs to support small businesses and their payrolls. According to ABA, these grants and loans are intended to save the industry from collapse. Without a dedicated line of funding, many motorcoach companies have been forced to apply for Small Business Administration grants, which have been challenging to secure.

Small Businesses, Big Impacts
Approximately 90 percent of the almost 3,000 motorcoach and bus companies in the US are small, family-owned businesses. The owners, drivers, dispatchers, maintenance and repair, safety, cleaning crews, finance, administrative, and other workers that staff the industry totals close to 100,000 people.

Though sometimes overlooked, motorcoaches and buses are an integral part of the travel industry. They often provide first and last-mile transit not serviced by airlines or trains, as well as a connection to those other modes of transportation. Collectively the industry makes close to 600 million trips each year. For comparison, the domestic airline industry makes around 700 million trips each year. The economic impact of these motorcoach trips is considerable, helping to generate more than $237 billion in transportation, travel, and tourism revenue.

The military frequently utilizes motorcoaches to transport troops domestically. Federal departments and agencies also use motorcoaches and buses to evacuate victims of natural disasters or national emergencies. Recently, motorcoaches were called upon to evacuate cruise ship passengers affected by the COVID-19 outbreak.

Furthermore, motorcoaches provide an essential service to those who need it most. Buses connect rural areas to city centers. They are the only means of intercity transportation, outside of owning a car, in many parts of the country. Buses are also a cost-effective option for those who cannot afford to travel by air or rail. If motorcoach companies were forced out of business permanently as a result of the COVID-19 pandemic, it would increase the travel disparity for many already underserved populations.

The rally was successful in galvanizing the motorcoach industry, sharing the value they bring to the country, and shining a spotlight on the circumstances they face in the wake of the COVID-19 pandemic. But even after federal, state, and local governments lift restrictions, a return to normal operations for this industry will be a long way off. In the meantime, these predominantly family-owned, small businesses will face the high costs of maintaining their vehicles and struggle to keep their doors open—that is, unless Congress takes action to keep our nation’s motorcoach industry rolling.

By Sharon Lo, Managing Editor, DTJ & The Source

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