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Race is on in German intercity bus market

Published: 23 Mar 2014 14:40 GMT+01:00

Since the regional coach market was liberalized in January 2013, a plethora of operators has hit the road to win a slice of the hotly-contested sector.

Bright yellow, apple green or electric blue, shiny new coaches in garish colours now compete for attention and market share as they criss-cross Europe's most populous country.

The newcomers try to lure passengers with comfortable seats, Wi-Fi Internet connections and sometimes free coffee.

Until last January 2013, coach services were limited to protect railway company Deutsche Bahn (DB).

Previously only a few long-distance bus services were allowed, some of them DB subsidiaries, mainly on routes that connected West Berlin with the rest of the former West Germany since before national reunification in 1990.

Now any company can enter the regional coach market for distances of at least 50 kilometres (31 miles) and routes with at least one hour between stops.

Within one year, these intercity bus links have almost tripled to 221, according to transport ministry figures.

Christoph Gipp of the IGES research institute said there are now 10 to 15 additional players in this "very dynamic market".

"Some smaller players have disappeared and some have merged with larger ones, for example MeinFernbus (my long distance bus)," he said.

This Berlin start-up, founded by two partners who had met as students, has taken the pole position with a market share of nearly 40 percent, according to an IGES study.

"Demand is strong, our buses are booked out regularly," one of its founders, Torben Greve, told AFP. Last year, his company transported 2.7 million people.

Deutsche Bahn is the second largest player, ahead of newcomers like ADAC Postbus, formed jointly by the automobile club ADAC and logistics group Deutsche Post.

Smaller new operators are Flixbus and DeinBus, while British operator National Express has also stepped in under the name City2City.

The buses are usually sleek and comfortable, but the main attraction is price.

"Great city. Small price. From €8 euros," City2City proclaims on its website.

MeinFernbus lets passengers cross the country from north to south. A trip from Hamburg to Stuttgart, from €28 - about half the cost of a train fare.

New routes also connect medium-sized cities such as Marburg, in the centre, Regensburg in Bavaria and Luebeck on the Baltic Sea.

"The long-distance bus is above all a competitor to the car," said Greve.

"It's used by people who want to escape the stress of driving or those who see it as an alternative to carpooling."

The buses attract lots of students, but also the elderly, who appreciate the convenience of direct connections compared with having to change trains en route.

The bus companies also highlight the environmental aspect, with a lower per-passenger fuel consumption and carbon footprint than car travel.

In the market - which is still small compared to overall traffic but growing fast - the increase in connections has led to "very tough competition," said Greve.

He vowed however that MeinFernbus won't offer rock-bottom fares.

"We're not one of those who offer one-euro trips, we don't think that's reasonable," he said, adding that his company intends to become profitable this year.

After the initial wild phase, the market should thin out, predicted Gipp - an analysis shared by Greve who believes "in the end there will be three or four long-distance bus companies in Germany".

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