SOON THEY EXPECT TO MOBILIZE 10 MILLION TRAVELERS
Colombiabus newsroom – William Marroquín / Istoé Dinheiro
In June 2021, plans were made known by the German FlixBus to disembark in Brazil before the end of the year. The company, famous for bringing down the prices of bus tickets in Europe and becoming an option for those who want to travel the old continent at a low cost compared to the plane and especially the train, expects to invest 650 million dollars for its operation in the South American giant.
FlixBus was created to capitalize on the opening of the transport sector in Germany in 2013, it adopted a model very similar to that of Uber, without the need to have its own fleet of vehicles, reducing the price of tickets. It was making acquisitions in Europe and is currently one of the main companies in the transport sector in the old continent, it is also present in the United States. It currently connects more than 2,000 cities in 30 countries.
FlixBus Brasil is ready to start operating in the country, pending the launch of regulatory bodies, such as the National Land Transport Agency (ANTT). «Brazil is one of the largest markets in the world, and we are only waiting for licenses, since we operate regularly in all parts of the world,» says Edson Lopes, General Director of FlixBus in the country.
The data allow estimating that the Brazilian travel market in the road segment is close to 50 million operations per year. In 2020, due to the pandemic, the figure fell by 54%, but this year there is already a recovery. Lopes calculates that also with intercity trips (suburban), the market is 80 million trips a year.
The executive also believes it is possible for FlixBus to become the market leader and quickly reach a market share of more than 10 million passengers. For this number to be possible, it would not be unusual for the company to start operations with aggressive promotions, as is often the case in other markets in which it debuted. The company recently debuted in the UK with trips for less than 1 Euro.
Like Uber when it began operating in Brazil, the company moved in a regulated market and several companies in the sector rejected the entry of a competitor who did not even own a bus and, according to them, did not comply with the standards established by ANTT. The Brazilian Association of Passenger Land Transport Companies (Abrati), for example, presented actions to block Buser’s operation, but withdrew them in April 2021.
In June, Buser received investments of 700 million reais and stated that he wanted to multiply by ten in two years with more than 1 billion reais (about USD 190 million) in investments. FlixBus will enter a market that is already more used to this type of service and additionally, it comes with a lot of money behind it: 100 million dollars that will be invested initially, will come from a contribution of 650 million previously received. In addition to cheaper trips, the company will bet on a premium segment, with more comfortable buses and the possibility of offering more trips in buses with bed and semi-bed accommodation. To do this, the company has been developing alliances with car manufacturers and financial entities to be able to leverage the purchase of vehicles from those interested.