DRIVING EXCELLENCE | LABOUR MARKET REPORTS 2021 BUSINESS & FINANCIAL

Compensation Workforce Business & Benefits Trends & Financial Employment Forecast CONTENTS

INTRODUCTION - MOTOR CARRIER PASSENGER COUNCIL OF CANADA ...... 4 PART ONE OVERVIEW 5 DATA SOURCES ...... 6 INDUSTRY-SPECIFIC...... 6 PUBLICLY AVAILABLE INFORMATION...... 6 SECTOR DATA PROFILES...... 6 LABOUR FORCE SURVEY1 ...... 6 JOB VACANCY STATISTICS2 ...... 6 SURVEY OF EMPLOYMENT, PAYROLLS AND HOURS3 ...... 6 JOB VACANCY AND WAGE SURVEY4 ...... 6 EMPLOYMENT INSURANCE STATISTICS5 ...... 7 EMPLOYMENT AND SOCIAL DEVELOPMENT CANADA16 ...... 7 LIMITATIONS OF BUS INDUSTRY LMI ...... 7 PART TWO BUSINESS ENVIRONMENT 8 INDUSTRY PROFILE...... 8 STRUCTURE...... 8 INDUSTRY REVENUES AND GOVERNMENT CONTRIBUTIONS...... 8 IMPACT OF COVID-19 ON REVENUE, RIDERSHIP AND SERVICE...... 9 PRE-COVID-19 TRAJECTORY...... 10 SERVICE PROVIDERS ...... 11 VEHICLES...... 12 URBAN TRANSIT ...... 13 PART THREE COVID-19 RECOVERY 14 URBAN TRANSIT ...... 15 PILLARS OF RECOVERY...... 15 PART FOUR LOOKING AHEAD 17 THE 15-MINUTE CITY ...... 17 INVESTING IN CANADA: CANADA’S LONG-TERM INFRASTRUCTURE PLAN FOR PUBLIC TRANSIT...... 18 PERMANENT PUBLIC TRANSIT FUND...... 19 EXCERPT FROM THE FALL ECONOMIC STATEMENT 2020...... 19 PART FIVE ON-DEMAND SERVICE 20 HIGHER EFFICIENCY, LOWER EMISSIONS...... 21 PART SIX VEHICLE PROGRESSION AND CLIMATE CHANGE 23 WHAT SHOULD PUBLIC TRANSPORTATION LOOK LIKE POST-PANDEMIC? ...... 23 CHALLENGES FOR TRANSIT SYSTEMS ...... 24 IMPACT ON CLIMATE AND CUSTOMER SATISFACTION...... 24 CONCLUSION...... 24 CANADIAN INDUSTRY...... 25 LONG-TERM PASSENGER VEHICLE OUTLOOK ...... 25 CANADIAN COMPARISON ...... 26 QUEBEC...... 26 OBJECTIVES:...... 26 NUMERICAL TARGETS...... 26 TORONTO, ONTARIO...... 27 ELECTRIFICATION IS THE FUTURE OF PUBLIC TRANSIT...... 27 AN INDUSTRY LEADER...... 27 TRANSIT INFRASTRUCTURE FUND...... 27 EDMONTON, ALBERTA...... 28 VANCOUVER, BRITISH COLUMBIA...... 29 PLAN FOCUS...... 29 BY YEAR 2030 ...... 29 SCHOOL BUS ...... 30 CUSTOMER VIEWS...... 30 PART SEVEN AUTONOMOUS VEHICLES UPDATE 31 UPDATES ...... 32 1 . WORLD’S FIRST DRAFT LAW ON AUTONOMOUS DRIVING LEGISLATION ...... 32 2 . OCTOBER 14, 2020: ...... 32 3 . AV IMPLEMENTATION ...... 33 AV IMPLEMENTATION CASE STUDY - TORONTO ...... 33 SAFETY...... 34 TORONTO’S RESOURCES...... 34 AV HIGHWAY...... 34 POLITICAL SUPPORT ...... 35 TORONTO’S TACTICAL PLAN...... 35 HUGE CHALLENGES AHEAD...... 35 REMOTE AREAS AND AV’S...... 35 AV’S AND EDUCATION...... 36 CONCLUDING THOUGHTS FOR THE BUSINESS OF AUTONOMOUS VEHICLES ...... 36 PART EIGHT PUBLIC SECTOR INVESTMENT UPDATE 37 URBAN TRANSIT ...... 38 FEDERAL...... 38 CONTINUED INVESTMENT...... 38 ALBERTA...... 38 BRITISH COLUMBIA...... 38 CONTINUED FUNDING...... 38 ONTARIO ...... 39 QUEBEC...... 39 SCHOOL BUS...... 39 PART NINE EMPLOYMENT 40

PART TEN LABOUR MARKET CHALLENGES 42 RECOVERY FROM COVID-19 PANDEMIC...... 42 TRANSIT AND ESSENTIAL ACCESS: THE IMPORTANCE OF SERVICE...... 42 TRANSIT AND SPACE: GETTING MORE OUT OF OUR STREETS...... 42 TRANSIT AND THE WORKPLACE: EQUITABLY BOLSTERING JOB FLEXIBILITY ...... 42 DESPITE TRANSIT’S IMPORTANCE, IT FACES SIGNIFICANT CHALLENGES . HOW CAN WE OVERCOME THEM?...... 42 SCHOOL BUS RECRUITMENT ...... 42 AGEING WORKFORCE...... 43 SUSTAINABILITY OF INTERURBAN AND RURAL BUS COMPANIES ...... 43 TOUR AND CHARTER...... 43 CONCLUSION...... 44 URBAN TRANSIT...... 44 SCHOOL BUS...... 44 MOTOR COACH...... 45 ENDNOTES...... 47 MCPCC | LABOUR MARKET REPORTS 2021 BUSINESS & FINANCIAL PART ONE OVERVIEW

INTRODUCTION - MOTOR CARRIER PASSENGER COUNCIL OF CANADA

The MCPCC provides a crucial National forum for industry, labour, government, and education to share resources and information .

MCPCC’s work is focused on several key areas: raising awareness of and advocating for the bus industry across Canada, reaching government, education, and the public; reporting www.buscouncil.ca much needed labour market information, recognition of the outstanding service of bus professionals; conveying industry- wide skills requirements, and accrediting the exceptional training and development that has contributed to the industry’s commendable safety record.

MCPCC is constantly seeking innovative ways to work with industry and government to promote busing as a critical link in the nation’s transportation infrastructure. It is a privilege to advocate for the exceptional men and women dedicated to this essential service.

For more information, contact

MCPCC 10350 Yonge Street, Suite 206 Richmond Hill, Ontario L4C 5K9 Tel: (905) 237-0533 [email protected]

All rights reserved. The use of any part of this publication, whether it is reproduced, stored in a retrieval system, or transmitted in any form or by means (including electronic, mechanical, photographic, photocopying or recording) without the prior written permission of the Motor Carrier Passenger Council of Canada is an infringement of copyright law.

Copyright © 2021 Motor Carrier Passenger Council of Canada (MCPCC)

This project was funded in part by the Government of Canada Sectoral Initiatives Program The opinions and interpretations are those of the authors and do not necessarily reflect those of the Government of Canada

4 PART ONE OVERVIEW

The COVID-19 pandemic has caused unprecedented job losses increase profitability of an integrated transportation infrastructure. in Canada and around the world. Although a substantial share of Vast changes are underway, due to the coronavirus disease the jobs lost have been recovered, as with all crises, there are often (COVID-19) pandemic, on the traveling public’s willingness to long-term consequences on those most impacted. use shared mobility, and the advent of electric and autonomous vehicles. In our sector, we have seen urban transit drop ridership of 96- 100% down to 8-10% nationwide; school bus closures, laying off While mass public transport currently remains the backbone workers before regular school breaks, driver shortages upon the of sustainable mobility solutions, the COVID-19 pandemic is re-opening of schools in September; intercity and tour and charter making the passenger transportation market more complex. businesses decimated to the point of temporary shut-downs and bankruptcy. Many industry representatives believe it will take at Key long-term considerations are: least two years to recover to 2019 levels along with implementing • Willingness to return to crowded vehicles & stations new approaches to services requiring new and upgraded skill sets. • Telework impacts • Changes in density and distribution of activities, Over the past few years, the industry has seen a transformation to especially office space digitization, and the emergence of new mobility players to improve • Automobile ownership efficiency, create better experiences for customers and ultimately • Willingness of governments to pay subsidies

KEY TRENDS IMPACTING THE INDUSTRY

KEY TRENDS POTENTIAL IMPACTS WORKPLACE CHANGES • Increased work from home • Lower ridership • Commuters willingness to return to public transportation • Move from mass transit to on-demand service

ON-DEMAND SERVICES • Driven by technology • Cost efficiencies • New skills requirements DEMOGRAPHICS • Ageing Population • Loss of skilled workers • Increased average age of workforce • Smaller labour pool • Migration and Immigration • Economic growth constrained by labour shortages • Urbanization • Curtailment/cancellation of rural services TECHNOLOGY • Automation • Job loss • Artificial Intelligence • Restructuring of existing occupations • Digitization • Emergence of new jobs and careers • Increased demand for advanced technical and “soft” skills • Falling demand for mid-skilled jobs CLIMATE CHANGE • Purchase of Electric vehicles • Challenges for carbon-intensive sectors • Increased investment in “green” sectors • New skill requirements

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DATA SOURCES SECTOR DATA PROFILES

Industry-Specific Labour Force Survey1

In general, near real-time administrative data offers robust insights • Provides estimates of employment and unemployment. about labour market dynamics. Moreover, timely administrative • Survey results provided 10 days after the completion of data data can be a key source that can be leveraged to generate labour collection. market indicators at a more local or granular level than what is • LFS data are used to produce the well-known unemployment available through prevailing survey instruments. rate as well as other standard labour market indicators such as This becomes extremely valuable under current conditions of the the employment rate and the participation rate. COVID-19 pandemic where workplace events are changing at a • Information available at the 2-digit NAICS level. rapid speed. For example, almost immediately urban transit ridership Job Vacancy Statistics2 plummeted 90% in April 2020, schools were closed prematurely, motor coach intercity and tourand charter businesses came to a • Provides a monthly portrait of the level of unoccupied positions, screeching halt. job vacancy rates and unemployment-to-job vacancies ratios. As publicly available information lags, we implemented • All estimates are produced at various levels of cross-classification direct contact, via ongoing consultations and interviews, with of geography (province and territories) and industry (available at participants from industry employers and employees, labour, the 2-digit NAICS level). associations, education, manufacturers and governments to access near real-time data. Survey of Employment, Payrolls and Hours3 Publicly Available Information • Provides a monthly portrait of the amount of earnings, as well as In our reports we also present data from Statistics Canada’s five the number of jobs (i.e., occupied positions) and hours worked. surveys; Labour Force Survey (LFS, record number 3701), the • Information available at the 4-digit NOC level. Survey of Employment, Payrolls and Hours (SEPH, record number • Information available at the national and provincial/territorial 2612), Employment Insurance Statistics (EIS, record number levels. 2604), Job Vacancy Statistics (JVS, record number 5202), and the Job Vacancy and Wage Survey (JVWS, record number 5217).

These surveys provide varying degrees of granularity and timeliness 4 with respect to bus industry labour market information. Job Vacancy and Wage Survey As a result of COVID-19 labour market information related • Job Vacancy Component of the JVWS collects data on the to ridership, employment, service levels, and safety protocols is number of job vacancies by occupation and economic region changing rapidly, therefore we are presenting the latest data from on a quarterly basis. Additional information is also available these sources as baseline information going forward. Reports by occupation, such as the average hourly wage offered, the that focus on long-term trends in occupational labour markets, proportion of job vacancies for full-time and part-time positions, at the moment, are not expected to be affected markedly by the the duration of job vacancies, and the levels of education and COVID-19 outbreak as impacts are generally foreseen to be experience sought for the job temporary. • Provides information at the 4-digit NOC code. • Data can be split by province (Alberta, Ontario, Quebec, BC, Manitoba only provinces/territories that consistently provide at a quality at the “acceptable” level and above). • Data tables produced quarterly.

Statistics Canada information is used with the permission of Statistics Canada. Users are forbidden to copy the data and re-disseminate them, in an original or modified form, for commercial purposes, without permission from Statistics Canada. Information on the availability of the wide range of data from Statistics Canada can be obtained from Statistics Canada’s Regional Offices, its World Wide Web site at http://www.statcan.ca and its toll-free access number 1-800-263-1136. 6 MCPCC | LABOUR MARKET REPORTS 2021 BUSINESS & FINANCIAL

Employment Insurance Statistics5 Employment and Social Development Canada16 • Reports on the operation of the Employment Insurance Program. ESDC uses the models of the Canadian Occupational Projection • Provides complementary labour market statistics at the national System (COPS) and the National Occupational Classification and provincial level, as well as for sub-provincial areas. (NOC, 2016 version) to develop projections of future trends in • The statistics released include the number of beneficiaries, types the numbers of job openings and job seekers for 292 occupational of benefits, benefit payments, the number of claims, as well as the number of disqualifications and disentitlements. groupings at the national level, covering the entire workforce. The • Estimates are also produced by detailed age and for 140 projections help to identify those occupations that may face labour occupation groups to the 2 digital NOC codes6 shortage or labour surplus conditions over the medium term. The latest projections cover the 2017 to 2026 period.

Statistics Canada also administers the Annual Passenger Bus and The current cops projections were completed in 2019, well before Urban Transit Survey. Data are typically released 2 years after the 2020 COVID-19 outbreak that resulted in exceptional and survey administration and includes: abrupt economic and labour market disruptions in canada as well • Financial performance of the industry;7 as abroad. However, the focus of the cops projections is on long- • Sources of operating revenue and expenses;8,9 term trends in occupational labour markets, not on short-term • Capital expenditure;10 developments. At the moment, these long-term trends are not • Equipment operated;11 expected to be affected markedly by the covid-19 outbreak as its impacts are generally foreseen to be temporary. • Fuel Consumption;12 • Maintenance costs;13 • Employment and compensation;14 and LIMITATIONS OF BUS INDUSTRY LMI • Revenue and passenger trips (urban transit only).15 There are two principal and interrelated challenges associated with open bus industry LMI. Data that are available on a timely It should be noted that a change in the questionnaire in 2014 basis (i.e., LFS) are typically rolled up to the 2-digit NAICS limits the comparability of results for some questions. level (Transportation and Warehousing). This limits the ability to interpret these data specifically for the bus sector. Conversely, data related directly to the industry, either at the 4-digit NAICS or NOC code, typically takes much longer to be released, limiting the ability to interpret these data as they are no longer timely (i.e., Annual Passenger Bus and Urban Transit Survey).

7 PART TWO BUSINESS ENVIRONMENT

INDUSTRY PROFILE

The motor carrier passenger industry of Canada, the bus industry, • school bus services is a significant force in the Canadian economy, with business • tour and charter carriers activity of approximately 1,114 companies, generating more • accessible services (paratransit) than $20 billion in 2018 operating and non-operating revenues, and employing over 118,000 full-time equivalent people. It is an The structure of the industry has changed significantly as a result essential component of Canada’s transportation infrastructure. of widespread industry consolidations in the school bus, intercity and tour and charter sub-sectors; which has repeatedly involved As a result of the COVID-19 pandemic 2020 year over year international investment. Selective evaluation of public/private revenues are down 77%, layoffs in public transit were over 5,000 partnerships and inter-modal alliances is continuing, primarily in April-May but as of late 2020 the majority have been recalled; motivated by economic and competitive issues. several motor coach companies including Greyhound Canada have temporarily suspended service and are forced to right-off 2020 with severe business losses; school resumed service in September Industry revenues and government contributions amid greater than usual challenges to recruit drivers as many are vulnerable and have chosen to retire. Total operating revenues for the Canadian passenger bus and urban transit industry increased to $13.9 billion (+7.3%) in 2018, We need to be rethinking where and how transit is going. while total operating expenses increased to $14.9 billion (+4.6%) We need to be looking at how to better integrate Transportation compared with 2017. Urban transit providers, which account Network Companies (TNCs) into first-and last-mile connections, for the majority (71.2%) of the industry’s operating revenue as a especially so that we are reaching the economically disadvantaged whole, reported operating revenue (without subsidies) increases and people who cannot work from home. To their credit, many to $9.9 billion (+8.9%). School and employee bus transportation, transit companies recognized early on in the pandemic where their as well as the charter and sightseeing bus industries both recorded ridership was traveling and they did rapid adjustments to ensure increases to $2.5 billion (+2.2%) and $675 million (+6.2%) in they were routing to where essential workers live and work. total revenues.

The intercity industry has been struggling for the previous seven Structure years, posting consecutive losses. The same holds true for 2018 with a deficit of $37.5 million in 2018 (income minus expenses) as The industry encompasses five sub-sectors: declines in revenue (-21.7%) outpaced those for expenses (-12.6%) • urban transit systems from 2017. • scheduled intercity bus carriers

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Impact of COVID-19 on Revenue, Ridership has climbed steadily each month since to reach 67.0 million in PART TWO and Service September. Despite this steady improvement, ridership remained 59.1% lower than the same month in 2019.17 On a year-over-year basis, the number of transit passengers in June BUSINESS ENVIRONMENT fell 74.6% to 37.9 million passenger trips. A significant annual One explanation for lower ridership is the large number of decline has been observed every month since March. As a result, post-secondary students completing their studies online. Several the total operating revenues (excluding subsidies) of urban transit transit agencies have reduced their service offerings to adapt to agencies also fell from the previous year, down 77.0% to $75.6 this situation. And with lower overall ridership, transit agencies million in June, further constraining local finances. According to continue to experience financial challenges. In September, total the Federation of Canadian Municipalities, lost transit revenue operating revenues (excluding subsidies) reported by these agencies related to the pandemic represents between 30% and 50% of the were $145.5 million, down 60.6% from the same month last revenue losses in cities with transit systems. For example, in British year.17 Columbia, updated revenue forecast models project TransLink’s cumulative losses for 2020 and 2021 could range between $544 With a second wave of the pandemic currently washing over the million and $945 million in the best-case scenario, and between country, transit agencies will face ongoing challenges into October $1.3 billion and $1.4 billion in the worst-case scenario. and for months to come. Like other businesses, transit must work to restore customer confidence by adopting innovative technologies September is typically marked by a strong increase in urban transit such as, for example, real-time crowd counters or predictors, traffic and revenues with the start of the school year and end information on vehicle locations and contactless payment options of summer vacations. After transit fell drastically in March and as well as more demand-responsive services. 17 April in response to COVID-19, the number of passenger trips

URBAN PUBLIC TRANSIT OPERATING REVENUE AND PASSENGER TRIPS, MONTHLY, 2017-2020

400

350

300

250

200 Millions 150

100

50

0 2017 2018 2019 SEPT 2020 Total revenue excluding subsidies (dollars) Total passenger trips (number)

Source(s): Statistics Canada Table 23-10-0251-01

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PRE-COVID-19 TRAJECTORY

It is clear that the urban transit sector was on a growth trajectory Conversely, with a major national intercity bus carrier scaling both with the number of companies and revenue generated. The back most of its operations in Western Canada, the industry has COVID-19 pandemic will shape the services provided both in experienced service cuts. This has left many former passengers the short and long term, i.e., digitization, on-demand service and somewhat disconnected since the coordination of ticketing services ridership levels as many will continue to work from home. among intercity carriers is now more difficult, making it harder to travel to more remote areas. It is apparent that the traditional Total operating revenues for the Canadian passenger bus and intercity business model of running scheduled services with few urban transit industry increased to $13.9 billion (+7.3%) in 2018, passengers has proven to be unsustainable in large and low-density while total operating expenses increased to $14.9 billion (+4.6%) areas of the country. The industry is adapting and innovating compared with 2017. to fill gaps in service, including public/private partnerships to Urban transit providers, which account for the majority (71.2%) improve the inter-community connectivity. For example, Western of the industry’s operating revenue as a whole, reported operating Economic Diversification Canada recently proposed match revenue (without subsidies) increases to $9.9 billion (+8.9%). funding (50% of the costs) for northern inter-city transportation School and employee bus transportation, as well as the charter and service. sightseeing bus industries both recorded increases to $2.5 billion (+2.2%) and $675 million (+6.2%) in total revenues.

INTERCITY REVENUES AND EXPENSES

80 75 70 65 60 55 Millions 50 45 40 35 30 2011 2012 2013 2014 2015 2016 2017 2018

Revenues Expenses

Source(s): Statistics Canada 23-10-0081-01

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With the exception of the intercity sector both the urban transit the last few months, ridership in urban transit has plummeted due and school bus sectors were on a steady path of growth. In 2019, to lockdowns and people working from home. The school and several major infrastructure projects were under construction charter bus subsectors have been hit hard due to temporary school to expand capacity and meet the anticipated increase in public closures and restrictions allowing for only essential trips between transit traffic ridership. Looking forward to the next few years regions, provinces and territories, and between Canada and other however, the impact of COVID-19 on this particular sector is countries. expected to be significant. As presented in urban public transit in

FIGURE 1: RIDERSHIP TRENDS - REGULAR SERVICE 2008 – 2018

ANNUAL RIDERSHIP BILLIONS 2.16 2.06 2.06 2.08 2.01 2.04 2.05 1.96 1.88 1.80 1.80

Source(s): Statistics Canada 23-10-0081-01

2018 marked another year of strong transit growth with 104 CUTA members collectively reporting 2.16 billion passenger trips which is an increase of more than 2.4% from the previous year.

SERVICE PROVIDERS

Figure 1 provides a graphic of the number of business companies operating in Canada. There were 1,114 bus companies operating in 2018, up by 7% from the number of companies in 2017.

FIGURE 1: NUMBER OF BUS COMPANIES (CANADA) (2012-2018)

1246 1114 1062 1032 1051 1024 936

751

542 531 491 488 411 485 400 Urban 347 396 Interurban & Rural 231 258 247 213 School & Employee 155 148 141 117 117 127 118 Charter & Sightseeing 87 85 88 92 96 95 98 Other 22 18 17 13 13 13 14 Total 2012 2013 2014 2015 2016 2017 2018 Statistics Canada. Extract from Table 23-10-0081-01 Financial performance of the passenger bus and urban transit industries

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VEHICLES

THE OVERALL NUMBER OF VEHICLES INCREASED BY 4% BETWEEN 2017 AND 2018

78,285 74,367 76,443 75,194 69,092

42,872 42,636 43,125 39,658 35,788

21,440 19,148 17,915 18,402 18,885

10,642 9,166 9,175 8,493 4,346

6,152 5,736 5,248 5,180 9,374

2014 2015 2016 2017 2018

Total number of vehicles School buses Urban transit buses Other rolling stock Motor coaches

School buses make up over half of the fleet of Canadian CANADIAN BUS INDUSTRY FLEET COMPOSITION (2018) bus companies, representing 55% of all rolling stock. School buses also make up 94% of the fleet in the school and employee bus sector. Urban transit buses are the next 13% 27% most prevalent, making up 27% of the industry and 85% 5% of the urban transit sector. Motor coaches, on the other hand, make up only 5.5% of the total rolling stock for the Motor Coaches industry but are the primary class of vehicles used in the School Buses interurban and rural and charter and sightseeing sectors at Urban Transit Buses 66% and 60%, respectively. 55% Other Rolling Stock

Statistics Canada. Table 23-10-0086-01 Canadian passenger bus and urban transit industries, equipment operated, by industry and type of vehicle

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Fossil fuel use in Canada is expected to decrease for many reasons. especially in Quebec and Ontario. The electricity sector is phasing- New technology and recent emissions policies are key. The out coal fired generation; by 2040 wind capacity is projected Pan-Canadian approach to pricing carbon pollution provides an to double and solar capacity to triple. Also, lower estimates for incentive to reduce demand for fossil fuels. In the transportation economic and population growth lead to lower fossil fuel demand. sector, green house gas emission standards for vehicles produced after 2018 results in lower gasoline and diesel demand growth. The Modified: 2020-10-09 Canada’s Energy Future 2018: number of electric vehicles will increase due to policy incentives, Energy Supply and Demand Projections to 2040

URBAN TRANSIT

2018 SUMMARY OF REVENUE BUSES BY FUEL TYPE - REGULAR SERVICE

11,616

3,296 Number of Revenue Busses Number of 1764

504 311 262 13 Diesel Biodiesel Natural Gas Gasoline Hybrid Hybrid Trolley Battery Fuel Cell Diesel Biodiesel Fuel Types

Source Bloomberg/NEF. Note Passenger car and bus figures are global. Commercial vehicle segment adoption figures in both charts cover the main markets of China. Europe and the U.S.

13 PART THREE COVID-19 RECOVERY

We know that things will not be the same post-COVID-19 but we have been presented with an enormous opportunity to build public transportation back safely, innovatively and greener.

“If we want people to participate in the economy, they need to get to work safely. No one should have to turn down a job because they don’t want to risk their health during a crowded commute.”

Prime Minister Justin Trudeau

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URBAN TRANSIT

Based on data released by Transit, demand for public transportation in Canada dropped an average of 83 percent in late March compared to previous years averaging 96-100%. More than half of transit’s operating revenue comes from the farebox and with ridership falling to record levels, revenue declined steeply. The graph below illustrates the drastic impact in Canada’s largest cities.

TORONTO MONTREAL VANCOUVER 100%

80%

60%

40%

20%

0% MARCH APRIL MAY

Source: City mapper Mobility Index International Energy Agency (IEA)

While ridership has steadily increased in the months since, it’s Pillars of recovery still only about 40% of pre-pandemic levels and unlikely to fully return for some time. Valid concerns related to safety, increased While COVID-19 has significantly impacted ridership, automobile use, congestion, and environment are inevitable. current trends present an opportunity to increase public Greater disparity among social standing is of great concern. Those transit’s importance: who can afford to drive will, further marginalizing low-income • Aging population, workers, who most likely are women, indigenous, and people of • Urbanization, colour, seniors and people with disabilities. A Statistics Canada • Traffic congestion, study from August reports that four-in-five people who left public • Road expansion costs, transit for other forms of transportation chose a private car. This • Consumer preferences and will have vast negative consequences on the environment, air • Health and environmental concerns shifting travel demand from quality and land use. automobile to alternative modes.

The stalwart commitment of governments to prioritize the investment in public transit is well founded in building inclusive sustainable communities.

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There is a growing realization among transportation PART FOUR professionals and much of the general public that there is a value to having a more diverse and smart transportation system . Hence, the diversification from mainly mass LOOKING AHEAD transit to innovative and cost-efficient integrated public mobility solutions .

Automated Fare Collecting System

Parking Information System Interactive Journey Planner for all modes

Intelligent Signalling System

Real-time Tra c Information System Automated Vehicle Location System

Car and Cycle Sharing Systems

16 PART FOUR LOOKING AHEAD

In 2019, several major infrastructure projects were under THE 15-MINUTE CITY construction to expand capacity and meet the anticipated increase in public transit traffic ridership. Looking forward to the next The COVID-19 pandemic has kept many people close to home few years however, the impact of COVID-19 on this particular supporting the principle that our neighbourhoods should contain industry is expected to be significant. Over the last few months, all we need for daily life. A concept has recently been popularized ridership in urban transit has plummeted due to lockdowns and by Paris mayor Anne Hidalgo, known as the 15-minute city, people working from home. Shared mobility usage drops in 2020 holds that basic necessities should be within a short walk or cycle as COVID-19 pushes people into private cars, but by 2040 it ride of home, reducing vehicle trips along with the emissions and represents 16% of all kilometers travelled by road. Autonomous inconvenience that go with them. vehicles progress steadily but do not materially impact global travel The overall idea isn’t new: it builds on principles of New Urbanism patterns until the latter half of the 2030s. 18 and transit-oriented development, and it finds its roots in the idea The school and charter bus subsectors have been hard hit of the “neighbourhood unit” advanced by the American planner due to temporary school closures, remote learning Clarence Perry in the early 1900s. Similar visions of and restrictions allowing for only essential trips 30- and 20-minute cities or neighbourhoods between regions, provinces and territories, have also emerged in the past decade, and between Canada and other countries. notably in Australia. The vision Hidalgo We are heartened by the Government and others champion isn’t a radical of Canada’s commitment to continued departure as much as it’s creating investment in public transit as a blueprint for a lifestyle many “central to thinking about restarting already aspire to have. In the the economy and building COVID era, where lockdowns more inclusive communities.” - and transit shifts have made Honourable Catherine McKenna people reorient their lives and November address CUTA rediscover their immediate conference. neighbourhoods, the 15-minute city may have caught its stride at the perfect time.

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In Canada, only 23 per cent of urban dwellers live in this type and the Canada Mortgage and Housing Corp. The data measures of area. This concept has been getting a lot of attention within proximity to amenities at the city-block level: How close residents government circles and policies are focusing on sustainable within that area are to such things as a grocery store, pharmacy, investments to continue momentum to this eventuality, albeit very school, and library. Even post-pandemic, the idea of the 15-minute challenging. city will still be relevant allowing for healthier living. Building and revitalizing cities around this concept is motivating infrastructure The Globe and Mail analyzed data on the country’s major investment and will blueprint public transportation service in the metropolitan areas released earlier this year by Statistics Canada future.

PERCENTAGE OF POPULATION LIVING IN AMENITY-DENSE BLOCKS

VANCOUVER 72.40% TORONTO 55.75% MONTREAL 54.59% QUEBEC CITY 23.10% WINNIPEG 21.57% OTTAWA 20.27% EDMONTON 15.04% SASKATOON 14.67% CALGARY 10.02% HALIFAX 9.28% MONCTON 5.49% ST. JOHN’S 3.45%

Source: Statistics Canada and Canada Mortgage and Housing Corp.

INVESTING IN CANADA: CANADA’S LONG-TERM INFRASTRUCTURE PLAN FOR PUBLIC TRANSIT

By improving the capacity, quality, safety and accessibility of public transit infrastructure throughout Canada, the Plan will reduce urban congestion and increase the proportion of Canadians who use transit and active forms of transportation to access jobs, education, health care and social activities. By taking national leadership to support local priorities, the Plan will also support the transition to a low-carbon economy, reduce air pollution, and under certain circumstances contribute to reducing Greenhouse Gas (GHG) emissions.

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From Canada’s small towns to its largest urban centres, efficient On November 30, 2020 the federal government released an public transit is vital to the functioning of communities. Public economic and fiscal update. transit helps to reduce traffic on roads so they can accommodate other economic activity. It is the primary means of mobility for Excerpt from the FALL ECONOMIC STATEMENT 2020 many Canadians, allowing them to access jobs, education, health care and social activities. With increasing urbanization and an 3.3.2.4 Public Transit Infrastructure aging population, transit systems in both urban and rural areas will need to adapt their services. Public transit gives Canadians faster, cheaper, and cleaner ways to get around. It also enhances our economy’s productivity, reduces In a written response to iPolitics, Chantalle Aubertin, press congestion and pollution, provides efficient and affordable secretary to Infrastructure Minister Catherine McKenna, said commuting options, and improves quality of life. Investing in “the pandemic has highlighted how public transit is critical to get public transit helps grow local economies and create more livable, essential service workers to their jobs in hospitals, pharmacies and vibrant, and inclusive communities. That is why, in Budget 2017, grocery stores. And for major projects to advance to procurement, the government announced unprecedented investments in public and to quickly stimulate jobs and growth with zero emission buses transit infrastructure as part of the Investing in Canada Plan. To and active transportation projects.” build on these investments the government will outline its next steps on public transit, including its plan to help electrify public The Plan devotes $28.7 billion to public transit and is already transit systems across Canada, and provide permanent public delivering results for Canadians. For instance, in the municipalities transit funding, in partnership with the provinces and territories. of Halifax, Moncton, Dieppe, and Riverview, 48 new buses This investment will accelerate Canada’s transition to a low-carbon recently purchased through the Plan use less fuel, reduce air economy, accelerate growth in local economies, and accelerate pollution and provide accessible and reliable public transit services. improvement to Canadians’ quality of life.

PERMANENT PUBLIC TRANSIT FUND Marco D’Angelo, president of the Canadian Urban Transit Association, issued the following statement after the federal Public transit is the backbone of livable cities contributing to government’s economic and fiscal update. less congestion, faster commutes, more convenience, higher productivity and lower emissions. The 10-year federal transit plan “We welcome the government’s commitment to permanent to deliver funds directly to transit agencies is revitalizing transit transit funding. It’s another step forward in predictable, long-term expansions in our cities and communities. funding that will help get transit built—and build the right kind of transit. We look forward to working with the government as the Transit improvements require long-term funding stability and new model takes shape. Transit systems also thank the government lobbying efforts from cities and transit systems are underway to for recognizing that transit is among the most COVID-19 affected implement a permanent public transit funding process sooner sectors of the economy. than later to kick-start recovery from the COVID-19 pandemic. While ridership and revenues have been drastically reduced, this Building more public transit creates jobs, makes our cities less setback is temporary and transit remains a critical component for congested, and helps meet climate goals. Public transit has some communities to thrive and enhance quality of life. of the largest long-term impacts of any kind of infrastructure and reduces greenhouse gas emissions by millions of tons a year. Even as COVID-19 rages, more than 2.5 million people take transit every day and we look forward to working with the government . on building more transit for the future and keeping today’s transit operating safely and conveniently.”

19 PART FIVE ON-DEMAND SERVICE

Since late last year, a number of cities – big and small, east and agencies with technology that continually optimizes bus routes west – have launched on-demand public transit pilots. Despite based on the moment-to-moment demand of customers, who COVID-19’S impact on overall ridership, early reviews are can use a mobile app to request a ride across a given service area. encouraging. The buses are deployed only in response to this direct customer demand, rather than continuously across a fixed route. Public transit ridership may be down as a result of the COVID-19 pandemic, but the growth of municipal on-demand transit services Pantonium’s first major municipal project arose in 2018, when this year [2020] is undoubtedly on the rise. In fact, municipal it was contracted by the city of Belleville to run an on-demand and business leaders alike cite the efficiency and adaptability of evening bus service. The program proved hugely successful, on-demand transit as a reason why its adoption makes sense more increasing evening ridership by 300 per cent and decreasing per- now than ever. bus mileage by 30 per cent while covering the city’s service area with a mere five buses, down from the previous 13. As public Service provider, Pantonium Inc, a Toronto-based on-demand transit demand dropped in Belleville due to COVID-19, the city transit software developer has implemented pilot systems in was also able to pivot its entire bus service to be on-demand Stratford, Chatham-Kent [Ontario], St. Albert, Alberta and Regina until usage had risen enough for fixed-route to be financially and Saskatoon [Saskatchewan]. Pantonium provides transit feasible again.

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Higher Efficiency, Lower Emissions

The primary factor attracting so many municipalities to on- demand is the increase in efficiency making operational costs less expensive for municipalities and more convenient for riders.

Pacific Western Transportation’s on-demand transit systems — currently operating in four Alberta communities — are designed to create efficiencies and customer satisfaction.

“We’ve seen instant adoption and numbers that surpassed the estimates” Dan Finley, VP Corporate Services, Pacific Western Transportation

On-demand service means that vehicle routes and timing are While other Canadian municipalities, including Belleville, Ont., determined by passenger demand, rather than set in advance have implemented on-demand transit solutions for certain off-peak by a transit scheduler. For users, public transit is as simple as bus routes, Pacific Western’s are the first full-time, on-peak, on- downloading an app and requesting a ride to a specific stop at a demand systems of their kind in Canada. certain time. Buses are then routed and deployed based on the location and number of customers in need of a ride. According to Finley, consumer response to the on-demand services, which can be booked weeks, days or minutes in advance, has been As such, optimal vehicle usage is ensured; only the precise number huge. “What we’ve seen as a result of that is instant adoption, and of buses needed to suit the number of riders who request a ride are in all cases numbers that surpassed what the estimates were to kick deployed, according to Finley. off,” says Finley.

How the on-demand transit service works.

Step 1: Book Step 2: Pay Step 3: Pick-up Step 4: Ride

• Create your account • Add a payment option to • Track your ride in • Hop on, show the driver your • Select your pick-up and your account real-time through the app or booking confirmation or drop-off location • Single ride or multi-ride online so you can be ready at paper ticket, relax and enjoy • Select the number tickets available your pick-up location when the ride of seats your vehicle arrives • Confirm your route

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A primary aim of on-demand transit is to serve those living in In addition to those in areas in which local transit hubs are accessible only by car. Aside Cochrane and Okotoks, PART SIX from making transit more convenient, these “first mile-last mile” Pacific Western’s on-demand solutions effectively decrease the number of single-occupancy systems are deployed in a vehicles used daily by commuters. Fewer vehicles mean less one-year pilot project in VEHICLE PROGRESSION traffic and shorter travel times, as well as reduced greenhouse gas Calgary and a single-vehicle emissions and pollution — at prices comparable to conventional system servicing Acheson AND CLIMATE CHANGE transit, according to Pacific Western. Industrial Park, located outside of Edmonton. Two of the communities being served, Cochrane and Okotoks, have less than 30,000 residents each, and had no public transit at The on-demand software all before the introduction of the on-demand systems in 2019. The for three of the systems choice for these communities to establish on-demand systems from is provided by RideCo, a the start “has greatly reduced their operating expense and provided Canadian company that much better coverage versus a standard fixed-route system,” helped implement similar according to Finley. services in American cities such as San Antonio and Los Another major benefit of on-demand transit service is its inherent Angeles. For those unable load adaptability, which during times of crisis such as the current to use the smartphone outbreak of COVID-19 could potentially prove lifesaving. Pacific app created for each of Western’s on-demand technology, however, makes adjusting the the systems, online and parameters of travel easy. The maximum passenger load for a telephone ride bookings are certain size of bus is simply lowered and more vehicles deployed, also available. allowing passengers to sit at a safe distance apart. Having a deployment model based on consumer demand also makes it easy Finley says his company is currently planning to expand its on- to adjust to rapid changes in ridership levels for other reasons, such demand business next fall with the implementation of a fleet of 50 as sudden emergencies or inclement weather. on-demand vehicles in Edmonton. That timeline, of course, will be subject to re-evaluation as the pandemic unfolds.

Calgary Transit on-demand 12 passenger vehicle.

22 PART SIX VEHICLE PROGRESSION AND CLIMATE CHANGE

ELECTRIC VEHICLE (EV)

WHAT SHOULD PUBLIC TRANSPORTATION LOOK LIKE POST-PANDEMIC?

Pre-COVID-19, public transit consistently enjoyed ridership levels This pandemic has demonstrated how essential transit is to our of 96-100%. At the peak of the pandemic in April 2020 ridership cities, whether it’s helping essential workers get to their jobs or plummeted to 8-10%. As many riders worked from home or helping Canadians get to supermarkets or pharmacies. But this chose more isolated options, public transportation took a severe hit essential service is facing extreme challenges as efforts to contain being forced to examine innovative approaches to public mobility. the virus mean more people are working from home.

Before the pandemic, transit had clear plans to electrify their fleets. According to Clean Energy Canada, “Modernizing and electrifying In 2019, there were over 500,000 electric buses on roads around bus fleets will help ensure Canadians continue to see transit as the world. Electric buses are expected to account for two-thirds a clean, safe, and reliable way to get around. It will also support of all buses and nearly 80 per cent of new bus sales by 2040, the hundreds of thousands of Canadians working in the public according to projections by Bloomberg New Energy Finance. transportation sector and ensure our electric bus and battery manufacturers remain global leaders.”

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CHALLENGES FOR TRANSIT SYSTEMS IMPACT ON CLIMATE AND CUSTOMER SATISFACTION While cities including Vancouver, Edmonton, Toronto and Montreal have plans to electrify their fleets and stop purchasing In 2019, electric buses displaced an estimated 270,000 barrels of diesel buses altogether by 2025, the road to electrification still diesel per day globally. The transportation sector accounts for a poses multiple challenges for Canada’s transit agencies. quarter of Canada’s carbon pollution. B.C.’s TransLink estimates that each electric bus replacing a diesel version saves 100 tonnes Clean Energy Canada examined the challenges associated with of carbon pollution per year. Electrifying bus fleets is a must if electrification and outlined their findings in a report entitled: Canada wants to reach its goal of net-zero emissions by mid- Catching the Bus: How smart policy can accelerate electric buses century. across Canada. Catching the Bus: How smart policy can accelerate electric buses across Canada. Electric buses also mean safer and healthier communities and are quieter, more modern, and more comfortable to ride than the Key themes that emerged were: diesel versions. Surveys show that seven out of 10 commuters prefer electric buses to conventional buses, and two thirds would • electric buses have a wide range of considerable benefits, and even be willing to pay more at the farebox to ride them. • integrating them into our cities isn’t quite as simple as swapping one bus out for another. November 2020: New polling data suggests Canadians are on board with more support for transit. The majority of 800 Canadians surveyed (83 per cent) by EKOS Research Associates Among the challenges flagged in the Report were cost, said they believe “governments have a responsibility to ensure infrastructure needs, and workforce skills and expertise. Electric people can access safe, affordable transit,” according to a statement buses still cost twice the price of a diesel bus, at least upfront, Friday by The David Suzuki Foundation, which commissioned and they require new facilities and charging stations where they the poll. can live and plug in. Charging infrastructure, “electric-ready” bus depots, new data and IT systems, and backup power and energy management systems are also part of the package transit CONCLUSION agencies require to ensure successful adoption. And because bus While the upfront costs of electrification are higher, the benefits electrification requires new approaches to route-planning and are worth the investment. Electric buses cost less to power and maintenance, transit agencies will also need to re-train and hire have fewer parts to maintain, saving tens of thousands of dollars new staff. in operating costs per year over the course of their lifetimes. As battery costs continue to fall and electric buses are produced on a larger scale, their price tags will become increasingly competitive. Electric buses are expected to have the same purchase price as diesel by 2030.

When performing maintenance on an electric bus, you can eliminate:

Engline Oil Engline Air Smog Replaing Coils Transmission Changes Filter Changes Testing or Spark Plugs Maintenance

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CANADIAN INDUSTRY LONG-TERM PASSENGER VEHICLE OUTLOOK

Investments in electric buses are also an investment in Canada’s The long-term outlook for EVs remains bright, as fundamental manufacturing industry. Three of the five major electric transit cost and technology improvements outweigh the short-term bus manufacturers in North America — GreenPower, New Flyer, impacts of the pandemic. Some near-term EV model launches will Nova Bus — are headquartered in Canada (a fourth, Quebec-based be delayed, but manufacturers so far are sticking to their long-term Lion Electric, makes electric school buses) and BYD building electrification commitments. zero emission battery-electric buses based in Newmarket Ontario. As well clean technology companies offer energy storage and By 2025, EVs hit 10% of global passenger vehicle sales, rising to hydrogen fuel cell solutions that are also part of the burgeoning 28% in 2030 and 58% in 2040. electric bus ecosystem. Growing demand for electric buses at home “Despite the dip from COVID-19, shared mobility plays a supports local jobs and helps Canadian companies maintain their growing role, reaching 16% of all road kilometers traveled in 2040, competitive edge. from around 5% in 2019.” While the pandemic has presented immediate challenges for many — including transit agencies — decisions made today have implications for the long term. Buses have lifespans of 10 to 20 years, meaning the investments we make in the wake of the coronavirus will have repercussions for decades. Investing in high- quality public transportation reflects exactly the sort of recovery we need: one that rebuilds our economy, supports Canadian companies, and aligns with our climate efforts.

2020 33% 30% 2% 2.7%

Municiple 2-Wheelers Light Commercial Passenger Buses Vehicles Vehicles

2030 58% 40% 28% 28%

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CANADIAN COMPARISON

Quebec Numerical Targets

Quebec’s plan represents a continuation of policies that led 50% • Reduce GHG emissions by 37.5% below 1990 levels by 2030; of all Canadian electric vehicles to be in Quebec. It also contains • Achieve carbon neutrality by 2050; new measures to improve communication with potential buyers • Have 1.5 million electric vehicles on the road in Québec and accelerate the installation of fast-charging stations. The plan by 2030; also addresses important sectors of Quebec’s industry and supports • No sales of new gasoline-powered vehicles as of 2035; further growth. • 55% of city buses and 65% of school buses electrified by 2030.

Objectives:

• Increase the number of electric vehicles in Quebec’s fleet; • Take part in the fight against climate change and in the reduction of greenhouse gas emissions; • Reduce oil dependence and therefore improve Quebec’s trade balance; and • Contribute to Quebec’s economic development and use the electric energy available in Quebec.

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TORONTO, ONTARIO

The Toronto Transit Commission (TTC) now has the largest fleet of electric buses in North America on the road with arrival of its third new electric bus model. “Public transit allows Canadians to get around in cheaper, cleaner and faster ways,” said the honourable Catherine Mckenna, Minister of Infrastructure and Communities. “Our government’s investment in the TTC’s electric bus pilot program is a sign of our commitment to made-in-Canada clean technology and an important step toward our target of 5,000 electric buses in Canada’s fleets over the next five years.

Canada’s infrastructure plan invests in thousands of projects, creates jobs across the country and builds stronger communities.”

The Toronto Transit Commission’s battery electric bus fleet now has a total fleet size of 60. The first of the newly arrived buses, Transit infrastructure fund which come from BYD Canada Co. Ltd. went into service on Sept. 8 2020. They join previously commissioned e-buses manufactured The e-bus purchases were financed with a $140-million investment by Proterra Inc and Winnipeg-based New Flyer Industries Inc. by the federal government and the City of Toronto through the federal Public Transit Infrastructure Fund. That sum will also Electrification is the future of public transit contribute to the cost of infrastructure to further expand the city’s zero-emission fleet. “The TTC board wholeheartedly supports the TTC’s forward- thinking plan to achieve a zero-emissions fleet by 2040. ”Jaye “I’m proud to help launch these new electric buses and to celebrate Robinson, Chair, Toronto Transit Commission” the fact that Toronto is now officially operating the largest fleet of electric buses in North America,” said Toronto mayor John Tory. The TTC originally approved the purchase of 30 fully electric buses in November of 2017, and approved a further 30 purchases A growing number of Canadian municipalities are making similar in 2018. The complete electrification of TTC buses, which is investments in zero-emission public transit. Cities such as Oakville, slated to occur by 2040, is a component of Toronto’s TransformTO Halifax, Edmonton and Vancouver have deployed, or plan to climate action strategy to achieve 80 per cent reduction in local deploy, fully electric buses in efforts to decarbonize their transit greenhouse gases by 2050. fleets.

An industry leader

According to the TTC, the decision to purchase three separate bus models was made in order to allow for head-to-head performance comparison which will inform future bus purchases. The BYD buses use alternating current (AC) electricity, and therefore require a different type of charging infrastructure than the others, which use direct current (DC). Each fleet is being housed at a different service garage. Thirty-five of the city’s 60 e-buses are in service as of now; the remaining 25 are undergoing final testing and are expected to be on Toronto streets by the end of September.

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EDMONTON, ALBERTA

In August 2020, Edmonton Transit Service (ETS) achieved a major come equipped with protective Operator shields. Electric buses are milestone by deploying its first battery-electric buses into service. roughly 30% less expensive to service and maintain than current This historic moment was the result of collaboration between diesel buses, plus savings on the cost of fuel. many City of Edmonton areas including ETS, Transit Fleet Maintenance, Fleet and Facilities Services, Corporate Procurement Electric buses are housed at the new Kathleen Andrews Transit and Supply Services, and the electric bus supplier, Proterra. Garage in northeast Edmonton, and Centennial Garage. Kathleen Andrews Transit Garage will become the main hub. ETS’ 40 electric buses are one of the single largest purchases of electric buses in Canadian history. All 40 buses will be deployed In 2015, ETS winter tested several electric buses to ensure the into service by the end of 2020. ETS is also the first transit agency technology would be suitable for Edmonton’s cold weather, steep in North America to have overhead chargers inside transit facilities. river valleys, and broad geographic transit area. The results were Charging from above, rather than using floor-mounted plug-in included in a 2016 feasibility study presented to City Council. The chargers, greatly reduces the amount of floor space needed for electric buses were also tested on steep Edmonton hills, using heavy charging. The buses take roughly one to four hours to recharge, sandbags to simulate full passengers loads. depending on the level of charge when they return to the garage. Training continues for bus operators, ETS inspectors, Proterra’s clean and quiet electric buses are winter compatible, have superintendents, instructors, fleet and facility staff, and first a range up to 350 kilometres on a single charge, and contribute responders. to the City’s shift toward more sustainable transportation, a lower carbon footprint, and high-quality transit service for residents. Transit customers will enjoy a clean, quiet and smooth ride. Electric buses can operate on almost every ETS route, and all buses

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VANCOUVER, BRITISH COLUMBIA

Metro Vancouver’s public transit authority is aiming to stay on The electrification of the bus fleet is TransLink’s primary strategy of schedule and stop the purchase of any new diesel buses starting in reducing its emissions by 45% in 2030, and 80% by 2050. 2023. To ensure there is no delay for TransLink’s Low Carbon Fleet

Strategy (LCFS), which will see the transition to electric-battery Plan focus powered buses and the replacement of aging diesels, the public • Reducing carbon pollution created from burning gasoline and transit authority is seeking $43.91 million from the Greater diesel in vehicles Vancouver Regional Fund (GVRF). This fund pools 95% of the • Supporting walkable, complete neighbourhoods federal gas tax fund received by Metro Vancouver municipalities • Supporting a transition to active transportation and transit; 2/3 towards TransLink’s projects, typically for the bus system. of trips in Vancouver to be by active transportation and transit • Encouraging drivers to switch to zero emissions vehicles Another $17.9 million is sought as a top up for the increased cost to purchase 57 new buses that are electric-battery models instead of the previously planned last generation of diesel hybrid buses. The Metro Vancouver is expecting an additional one million residents total funding requested from the GVRF for this bus acquisition is in the next 20 years. There is no more room for additional road $86.1 million. space for more driving or parking. Active transportation and transit can move more people in an equivalent amount of road space When other funding sources are included, both projects as part compared to motor vehicles. of the first wave of bus electrification will cost a total of $119.3 million, with the GVRF covering $113.8 million. These 57 new By year 2030 electric-battery buses are expected to reduce operating costs by $14.4 million compared to diesel models over the 17-year lifespan • Being able to meet more daily needs in the neighbourhood of the vehicles. • Bus priority along 10 key corridors • Connected cycling and walking networks city-wide As outlined in February 2020, TransLink requires over $400 • EV charging in neighbourhoods throughout the City million to deliver its LCFS target over 10 years of acquiring up to 635 electric-battery buses to replace aging 40-ft regular buses and 60-ft articulated buses that use combustion fuels, and the associated charging and maintenance infrastructure.

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SCHOOL BUS

Federal and provincial governments are providing funding for the Customer views acquisition of electric school buses. The Lion Electric Co. Survey results gave a clear message: the Examples: public want more electric transportation.

Transdev Canada, present in Québec and Ontario, has invested • 92% survey respondents think that electric transportation is a nearly €3 million in a fleet of 27 electric school buses. These 27 good way to reduce greenhouse gas emissions. school buses, developed by the Québec company Lion, will enable • 93% think that governments should encourage the electrification of transportation. Transdev Canada to reduce its emissions by 99%, compared • 93% think that switching from diesel buses to electric buses to diesel buses, in its school transport networks operating in would improve air quality. Québec. Transdev Canada becomes the largest private operator of • 87% think that diesel bus emissions have a negative impact on electric school buses in North America, increasing its fleet to 31 the health of children who take these vehicles. operational electric buses by the end of 2020.

On November 9, 2020, Prince Edward Island and the Federal Government announced the purchase of 12 electric school buses manufactured by Lion Electric.

BC provincial government announced funding to 31 school districts to buy up to 15 electric-battery school buses as part of a $13-million funding pool to acquire 101 new school buses in the 2020-21 bus acquisition program.

30 PART SEVEN AUTONOMOUS VEHICLES UPDATE

In our December 2019 Business and Financial Report, we processes, current state of AV’s, limitations of AV’s, AV legislation presented a detailed synopsis on the emergence of autonomous and AV’s in public transit. As this report remains relevant in 2020- vehicles. The report outlined the Society for Automotive 2021, we invite you to re-examine the commentary at https:// Engineers International (“SAE”) six-level classification system buscouncil.ca/downloads/2019-LMI-business-financial-report_ for automated vehicles, ranging from 0 to 5, and highlighted the en.pdf beginning at page 18. challenges, concerns, i.e., human sensory and decision-making

SAE LEVELS OF AUTONOMY

0 1 2 3 4 5 No Automation Driver Partial Conditional High Full Assistance Automation Automation Automation Automation

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UPDATES

1. World’s first draft law on autonomous driving 2. October 14, 2020: legislation The City of Toronto announced that it had signed an agreement Germany could be the first country in the world with legislation with Phoenix-based Local Motors to deliver an electric, automated for fully driverless vehicles (SAE Level 4). Germany will set shuttle for a six-to-12-month trial period - Its name is Olli 2.0. . regulatory standards worldwide with the new law within the The shuttle bus can seat up to eight passengers, is wheelchair- next twelve months,” says Benedikt Wolfers, founder and accessible, and provides audio and visual announcements. The partner of Posser Spieth Wolfers & Partners, who presented the single automated vehicle being used for the pilot project will cater as yet unpublished draft law at the Chapter Event from The to Scarborough residents living in a transit dead-zone and transport Autonomous. “This could have a lasting impact on the future of them to the Rouge Hill GO station. autonomous driving – EU-wide and globally.” The project, called the Automated Shuttle Trial, is in partnership “A unified set of regulations will give car manufacturers legal with Metrolinx with funding from Transport Canada. The City of certainty for next-generation autonomous vehicles,” says Ricky Toronto adds that two staff members will be on board for every Hudi, Chairman of The Autonomous. “Consumers can rely on trip to monitor and learn from the trial runs. a unified safety standard and gain confidence in autonomous driving.” Specifically, the German draft regulation considers the As cited in our 2019 report Pacific Western Transportation and functioning, test procedures for, and approval of, autonomous TransDev have also led shuttle trials in Alberta, British Columbia driving functions, as well as cybersecurity. and Quebec.

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3. AV Implementation

Driving in mixed traffic involves numerous interactions with diverse pedestrians, animals, bicyclist and vehicles and so is more complex than flying on an airplane (Keith Shaw)

AV IMPLEMENTATION CASE STUDY - TORONTO

Toronto Region Board of Trade (TRBOT) president and CEO Janet De Silva, expressed in her opening remarks at the launch of the TRBOT’s new report: Getting Ready for Autonomy: AVs for Safe, Clean and Inclusive Mobility in the Toronto Region that integral to managing the growth in the Greater Toronto Area (GTA) will be autonomous vehicles and the technology surrounding them.

The report lays out the rationale to advancing in this direction and outlines a series of 20 Recommendations [related to People, Regulation, Management and Infrastructure].

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Safety Toronto’s Resources

Autonomous vehicles hold enormous potential for improving Two factors make the Toronto region well positioned for the road safety. According to the board’s report, an estimated 94 autonomous revolution. per cent of motor vehicle collisions are the result of human error, and already widespread basic automated features such as One is the area’s rich automotive history and the other is the city’s lane departure warnings have reduced rates of injury-causing growing technology sector. crashes by 21 per cent. Along with the added safety will come Toronto is already reportedly home to the highest concentration a fundamental transformation of urban transit. Sharing of of artificial intelligence start-ups in the world, and many of autonomous vehicles could bring economic benefits including those start-ups involve AV technology. The Autonomous Vehicle reduced congestion, greater productivity and the freeing up of large Innovation Network (AVIN), which is backed by the Ontario urban areas currently utilized by parking and other personal vehicle government, provides funding, business development and infrastructure. demonstration grounds for companies developing AV technology. “Imagine what widespread AV deployment could look like: Commuters stepping out of their homes AV Highway and into self-driving vehicles taking them and a few Among the recommendations the report makes is to designate neighbours to a local GO station” the 407 ETR highway as the “AV Highway of the Americas,” on which AV technology could be tested. The 407, which runs 108 Janet De Silva, kilometres across the northern boundary of the GTA, was the President and CEO, Toronto Region Board of Trade world’s first electronically operated toll route. It currently utilizes over 1,000 cameras on a fiber-optic network to monitor traffic and automatically assign tolls to each vehicle. As such, according to the report, it is a “regional asset ready for the testing and deployment of AVs unlike any other.”

The 407 ETR highway is noted for its potential to be the “AV Highway of the Americas” as a test area for AV technology. Image credit: 407 ETR

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POLITICAL SUPPORT • How will private data used by autonomous vehicles and passengers be protected? The report is the product of consultation with TRBOT’s • What legal responsibility will public transit agencies and drivers AV Readiness Council, which includes representatives from have for their autonomous vehicles? organizations including Ford, Ontario Power Generation, Telus, and Borden Ladner Gervais LLP (BLG). Even with a heavy degree of skepticism, it seems likely that if BLG, a Canadian law firm active in the field of autonomous you live in a major city you will be able to hail some form of vehicles, also sponsored the report and hosted its launch. As such, automatic car ride in less than a decade. [Artificial Intelligence] AI the report demonstrates a significant show of industry leadership at is becoming more and more a part of everyday life and automobiles a crucial moment in the transition to AVs. are no exception.

The Toronto region, for instance, is made up of 34 distinct Remote Areas and AV’s municipalities. For AVs to become fully integrated into its transit ecosystem, a variety of different parties must be brought on to the Despite expansive public transit networks in many parts of same page. Concrete steps recommended by the report include the country, a number of Canadians still live in areas in which increasing federal and provincial investments to ensure new AV- local transit hubs are accessible only by car. “First-kilometre/ related talent can be nurtured and current workers are retrained in last-kilometre” solutions aim to find transit strategies that bring AV skills. It is also crucial that private industry and the public are passengers from their home to their destination without any gaps, kept aware of the changes AVs are expected to bring to Toronto. thereby reducing the number of single-occupancy vehicles used daily. The report also recommends that municipalities establish a consistent framework for sharing data with one another so regional In order to address this problem, the Canadian Urban Transit transit authorities can work together to integrate AVs into their Research and Innovation Consortium (CUTRIC) has announced networks. the establishment of a new collaborative research initiative aimed at improving autonomous shuttle technology, which it says has TORONTO’S TACTICAL PLAN serious potential to provide first-kilometre/last-kilometre transit solutions. Toronto has already taken a step towards AV deployment. As stated earlier in this report, the city recently adopted an Automated “Smart electric shuttles can provide the flexibility and cost Vehicles Tactical Plan, making it one of the first North American efficiency needed to get Canadians to a transit hub” says Josipa cities to do so. The plan includes a timeline to 2050 but also Petrunic, executive director and CEO of CUTRIC. recommends several short-term steps that can be taken now to Project partners include academic institutions, transit authorities move towards autonomous transport. and private entities, such as ABB, Bombardier, Kingston Transit, London Transit, Carleton University, University of Windsor, Huge challenges ahead University of Toronto, and several others.

Despite Switzerland pushing ahead on AV’s for public transit, not all mobility experts are convinced by driverless buses. Driverless challenges – both regulatory and technical – remain huge, raising many questions. • Will the introduction of autonomous buses, taxis and privately- owned driverless vehicles just clog up the roads if they are not correctly regulated? • How safe will such vehicles be? • Will autonomous buses be used downtown or just in suburban areas?

An autonomous shuttle. Photo: Keolis Canada

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AV’s and Education Concluding Thoughts for the Business of Autonomous Vehicles A new report from AVIN (Autonomous Vehicle Innovation Network) outlines the impact autonomous vehicle deployment Although in 2016 many industry leaders expected autonomous will have on our economy and society. According to the report, vehicles to be commonplace on highways in the early 2020s, this an increasing number of jobs in the automotive sector will require doesn’t seem likely. When predictions were made, experts were advanced technological skills as automation becomes the norm. likely caught up in the Artificial Intelligence (AI) hype. Now with Foremost among those will be areas of computer science including more information initial thoughts are changing because of how computer vision (the process of teaching machines to process difficult machine learning projects are in general, let alone those for images and videos as humans do) and machine learning. Other self-driving cars. areas of expertise that will see increasingly high demand include cybersecurity, manufacturing and production engineering, software Many of the largest institutions are only now starting to look engineering, and signal processing engineering. into AI for digitizing paper documents and searching through their digital databases. Although there’s a lot of talk about them, As it stands, there is already a sizeable gap between the number chatbots aren’t anywhere near the point of being able to hold of workers currently equipped with these skills and the level of human-like conversations with customers. demand which the industry will require. However, according to the report’s author, Sherin Abdelhamid, technical advisor of It makes sense that despite the massive amounts of venture automotive and mobility at AVIN, educational opportunities to capital, self-driving car technology is still a long way off before upskill already exist. “There’s still a gap, but some programs have they become available to people at any legitimate scale. The other been offered for years now,” says Abdelhamid, citing the University consideration is that self-driving adoption timelines depend heavily of Toronto’s online learning specializations in self-driving cars as on the regulatory developments in the next few years. Autonomous an example. “There are people working now on these things, there vehicles require both the right legal and technological frameworks are people acquiring these skills, but of course the supply isn’t and integration into a mobility structure. comparable to the demand.”

36 PART EIGHT PUBLIC SECTOR INVESTMENT UPDATE

As a result of COVID-19 public transit has become even more critical. Public sector investment plans budgeted in 2016-2017 continue https://buscouncil.ca/ downloads/2019-LMI-business-financial-report_en.pdf (Page 22) and efforts are underway to fast-track construction of planned transit systems to help the country financially recover from the impact of COVID-19.

Federal Government and Provinces have injected emergency funding to help public transit agencies amid coronavirus crisis

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URBAN TRANSIT British Columbia

Following Prime Minister Justin Trudeau’s announcement in July Federal 2020 to invest over $19 billion to the provinces and territories to In July 2020 Prime Minister, Justin Trudeau, announced a federal help them in their restart efforts amid the coronavirus pandemic, investment of more than $19 billion to help provinces and the province announced it will cost-match this amount. territories safely restart their economies and make our country In the $19 billion federal restart package, a total of $1.8 billion has more resilient to possible future waves of the virus. In addition been allocated for transit funding nation-wide. to supporting health care systems, the investment will help municipalities to deliver essential services, like public transit. “People need critical frontline services, including public transit, Public transit authorities are struggling to keep up with safe service to get safely back to work and build back up our economy,” said levels due to the collapse in fare revenue and other transportation- infrastructure and Communities Minister Catherine McKenna. demand oriented revenues. Altogether, the provincial and federal governments are each providing $1 billion to BC municipal governments and public Continued Investment transit authorities. Through the Public Transit Infrastructure Fund, Budget 2016 focused on making immediate investments of $3.4 billion over Continued Funding three years, to upgrade and improve public transit systems across Canada. B.C is continuing Phase Two of its 10-Year Vision 2018 – 2027 INVESTMENT PLAN To support the next phase of ambitious public transit projects, through Budget 2017 the Government committed to invest $25.3 https://tenyearvision.translink.ca/-/media/tenyearvision/planned- billion over the next decade, including $5 billion invested by the projects/10-year_vision_phase_2_investment_plan.pdf Canada Infrastructure Bank. The 10-Year Vision is unique in Canada. It is a region-wide, Shorter commutes, less air pollution, more time with family and integrated plan – from rail to buses to roads and bridges – that stronger economic growth are all benefits of modern, efficient supports BC’s 30-year Regional Transportation Strategy and public transit. To support the next phase of ambitious public Regional Growth Strategy. The 10-Year Vision will be rolled out transit projects, the Government will invest $20.1 billion through in three phases, each timed to the delivery of new projects and bilateral agreements with provinces and territories. This funding services. will make it possible for Canadian communities to build the new urban transit networks and service extensions that will transform the way that Canadians live, move and work.

These investments will help to improve commutes, cut air Phase One pollution, strengthen communities and grow Canada’s economy. 2017-26 Investment Plan

In addition to this funding a number of provinces have also committed significant resources. Phase Two 2018-27 Investment Plan Alberta Phase Two Update The Government of Alberta has committed $1.3 billion over the four 2020-29 Investment Plan years of Budget 2017 for urban, rural and regional transit to connect communities and help Albertans access affordable transportation options. Alberta’s transit investment aligns with the province’s Climate Phase Three Leadership Plan, as transit helps to reduce greenhouse gas emissions 2021-30 Investment Plan by providing affordable alternatives to single-occupancy vehicles.

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Ontario All of these protocols are not easy to follow but are essential to reduce the risks tied to school buses for the duration of the Ontario is investing $10.2 billion under the Investing in Canada pandemic. These add additional layers of responsibility on an Infrastructure Program to improve public transit; community, already over- burdened sector. culture and recreation; green, and rural and northern community and other priority infrastructure. To support both school boards and school transportation companies, provinces have stepped up providing funding for Across the province, Ontario is investing more than $7.3 billion in enhanced health and safety measures. For example, Ontario public transit infrastructure over 10 years through the Investing in has provided $25.5 million to assist in reducing the number of Canada Infrastructure Program. students on school buses to support physical distancing, as well as addressing other pressures school boards may face in transporting Quebec students as a result of COVID-19. This $25.5 million in funding will be allocated to school boards proportional to school boards’ The province presented its INFRASTRUCTURE PLAN 2020 2020-21 Transportation Grant allocation. – 2030 https://www.tresor.gouv.qc.ca/fileadmin/PDF/budget_ depenses/20-21/7-Quebec_Infrastructure_Plan.pdf

Highlights include $8.6 billion to be invested in different modes of transportation: in the road network, to maintain the good condition of this asset that is essential to Québec’s economic development, in public transit, to foster its development, contributing to the reduction of GHGs and adaptation to climate change, and in other transportation infrastructure, including measures related to the maritime strategy.

School bus

Provinces recognize that school boards are facing unique student transportation challenges for the 2020 school year as a result of COVID-19. This includes significant added costs due to hygiene requirements, physical distancing, labour shortages as vulnerable In addition, it is recognized that the student transportation sector drivers elect to leave for health concerns, safety, increased may be facing a greater driver shortage this year. As such, $44.5 monitoring etc. Several recommendations/protocols for best million is set aside to support ongoing efforts in school bus driver practices have evolved across the country highlighting the added recruitment and retention for the 2020-21 school year. A total responsibilities for school bus companies and drivers. amount of $70 million will be provided for student transportation to enhance health and safety measures for school buses and to • Buses should be cleaned and disinfected in accordance with public health guidelines ensure service stability for students and families as schools reopen. • Buses should be loaded from back to front and offloaded from https://efis.fma.csc.gov.on.ca/faab/Memos/B2020/B14_EN.pdf front to back • Keep seating consistent and assign seats where possible. If space is available, each student should have their own seat unless sharing with a member of their household • Middle and secondary school students are required to wear non- medical masks. Exceptions will be made for students and staff who cannot wear masks for medical or disability related reasons • Adjusting routes to shorten ride times • Windows open, weather permitting • Air purifiers when windows are closed • Protection for drivers, PPE, testing, driver shields in cab • Safe sanitizing products 39 PART NINE EMPLOYMENT

After pausing in October, employment growth resumed in transportation and warehousing in November (+20,000; +2.1%). The increase was largely the result of gains in 69% Ontario and British Columbia, bringing employment in this Bus Operators industry to within 6.4% of its pre-COVID level. 25% The breakdown of employees by position has remained 6% Other consistent since 2012. Overall, bus drivers make up 69% of Mechanics/Maintenance employees. This is lowest in the urban bus sector (54%) and highest in the school and employee bus sector (89%). On average, employees in the urban transit sector ($96,658) and interurban and rural bus sector ($84,614) are compensated considerably more than in other sectors, particularly relative to school and employee bus transportation employees ($30,857), however it should be noted that the majority of school bus employees are part-time.

TABLE 1: BUS INDUSTRY EMPLOYMENT STATISTICS OVERALL AND BY SECTOR (2018)

Average Total # % Other % Drivers % Mechanics expenditure employees employees per employee Urban transit systems 63,237 54% 8% 38% $96,658

Interurban and rural bus transportation 2,158 67% 15% 18% $84,614

School and employee bus transportation 41,597 89% 4% 7% $30,857

Charter and sightseeing bus industries 6,398 68% 6% 26% $37,767 Other transit and ground passenger 5,864 80% 3% 17% $46,767 transportation Total Bus industry (2018) 119,254 69% 6% 25% $67,875

Source: Statistics Canada. Table 23-10-0083-01 Canadian passenger bus and urban transit industries, employment and compensation, by industry

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COVID-19 pandemic has created unprecedented numbers of As the second wave erupted in September, the number of workers individuals working from home. In April, at the height of the working from home has steadily increased. Among those who PART NINE COVID-19 economic shutdown, 3.4 million Canadians who worked at least half of their usual hours, 4.6 million Canadians worked their usual hours had adjusted to public health restrictions worked from home in November. This was an increase of EMPLOYMENT by beginning to work from home. This number has fallen each approximately 250,000 from October and included 2.5 million month since May, when the gradual easing of public health who do not usually work from home. Among the same group, the restrictions began, and reached 2.5 million in August. Among number of people working at locations other than home fell by Canadians who worked their usual hours in August, the total approximately 100,000 to 12.2 million. number working from home fell by nearly 300,000 compared with July, while the number working at locations other than home In the transportation industry, as expected with drivers and increased by almost 400,000. mechanics making up 75% of the bus workforce, the cadre of workers working from home would be management and administrative staff.

THE CHART BELOW CONFIRMS THE PROFILE OF THE INDUSTRY .

Workforce teleworking or working remotely prior to February 1st, 2020

Business % range, % % % % % range % % % % % % % characteristics 0% to less range, 1% range10% range20% range30% 40% to range50% range, range range range range range than 1% to less to less to less to less less than to less 60% to 70% to 80% to 90% to 100% unknown than 10% than 20% than 30% than 40% 50% than 60% less than less than less than less than 70% 80% 90% 100%

transportation 73.1 12.5 3.4 1.6 0.8 0.0 1.6 0.0 0.8 0.3 1.3 3.1 1.6 and warehous- ing [48-49] Workforce teleworking or working remotely, March 31, 2020

Transportation 47.5 15.9 7.3 5.5 3.4 2.1 3.7 0.3 2.3 1.6 3.4 6.0 1.0 and warehousing [48-49] Percentage of workforce able to carry out a majority of duties during the COVID-19 pandemic

Transportation 6.8 3.7 3.1 3.9 3.4 4.2 6.3 3.1 5.0 6.3 14.1 37.9 2.3 and warehousing [48-49

As urban transit is an essential service, the lion’s share of the industry is able to carry out the majority of duties. The school bus operators early in the pandemic and motor coach operators to date are representative of the 0-80% range.

41 PART TEN LABOUR MARKET CHALLENGES

RECOVERY FROM COVID-19 PANDEMIC

Transit ridership dropped from 96-100% in early March to as low Transit and the workplace: equitably bolstering job as 8% during peak of COVID-19 in April 2020. We are now in a flexibility second wave of the pandemic and ridership while having recovered Remote work capabilities have enabled countless companies, to about 50% of pre-COVID-19 levels remains precarious. organizations, and government agencies to continue operating during COVID-19. Before the pandemic, these telework COVID-19 has brought swift, unrelenting harm. As applied to capabilities were not fully realized. Polls have found that more than transportation, the pandemic’s pressure has forced us to rethink three-quarters of Canadians able to work remotely would like to how we move people. Transit connectivity is vital to goals of continue doing so regularly even after the pandemic is brought essential access, efficient use of space, and workplace flexibility. Yet under control. COVID-19 has made challenges that have long hindered transit – like constrained budgets and negative stereotypes – even more Despite transit’s importance, it faces significant imposing than before. challenges. How can we overcome them?

Even though transit has been vital to society’s resiliency during Transit and essential access: COVID-19 and can help build a better post-pandemic world, the importance of service challenges and uncertainty continue to threaten service. Not only are transit agencies contending with severe funding challenges, but Public transit’s biggest role during COVID-19 has been its fears surrounding possible COVID exposure aboard transit are basic mission: getting people where they need to go. While the influencing transportation behavior even though results of contact pandemic’s impacts have significantly reduced total ridership, data tracing and surface sample testing indicate that buses and trains are shows how sustained transit service continues to connect people to low risk for contracting or spreading the disease. essential jobs and services. School bus recruitment

Transit and space: getting more out of our streets The school bus sector has been consistently challenged in recruiting and retaining bus operators. This challenge has Studies have found that transit boosts active transportation’s intensified as COVID-19 worsens driver shortages. These shortages viability. Policy and business results illustrate how deeply transit is have forced bus delays and cancellations in many areas across intertwined with active mobility. Canada. In many areas the average age of a driver is over 55 and

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many are even older and have decided to remain off the job due to Tour and charter age-related health risks from COVID-19. The tour and charter business has suffered devastating losses PART TEN throughout 2020. The sector experienced fallout between 80% to Ageing workforce 90% of cancelled trips and very few future bookings. Some of the LABOUR MARKET CHALLENGES The aging population will disproportionately affect the bus worst losses have been seen in the charter business, which depends industry, where bus drivers make up 68% of the total workforce on tours, meetings, and conferences, where bookings were almost and have a median age of 51.7. It is projected that roughly 40% non-existent during the busiest time of year for this sector. In of the workforce will retire in the next 10 years, and while it is addition, for many charter companies the period of March through projected that supply will meet demand, fewer new drivers may June is when they earn as much as 60% of their revenue for the put a strain on driver training programs. year and that work has been eliminated. The owner of Coach Atlantic Group says his company is projecting Sustainability of interurban and rural bus companies revenue losses of $30 million this year because of the COVID-19 pandemic. Mike Cassidy says the crisis is impacting every area of As mentioned earlier in our Report, the intercity industry has been his business. “There wouldn’t be many companies in the Maritimes struggling for the previous seven years, posting consecutive losses. that would be facing that type of revenue drop,” said Cassidy. The same holds true for 2018 with a deficit of $37.5 million in “It just so happens there’s no cruise ship, there’s no multi-day 2018 (income minus expenses) as declines in revenue (-21.7%) tours, and group charters right now are non-existent, and that’s a outpaced those for expenses (-12.6%) from 2017. It is apparent huge component of our business.” Cassidy says Coach Atlantic’s that the traditional intercity business model of running scheduled scheduled interprovincial bus routes have also been hit hard. services with few passengers has proven to be unsustainable in large Schedules have been reduced to three days a week with around 80 and low-density areas of the country. passengers a day travelling throughout the system.

FirstGroup, which bought Greyhound in 2007, plans to sell the Motor Coach companies surveyed expect it will take at least 20 bus line. Changing travel trends have meant a bumpy road for months to return to pre-COVID-19 business levels — if they Greyhound. “The issues at Greyhound have revolved around the make it that far. John Wilson, president and CEO of Wilson’s impact of low-cost airlines coming into some of our markets and Group of Companies comments “Ninety-five per cent of the motor (the) relatively low oil price over the year, which in the U.S. means coaches right across North America are parked right now.” “We more people get into their cars,” FirstGroup Chief Executive continue to be down approximately 95 to 97 per cent of revenue Matthew Gregory told reporters. month over month,” He expects a limited restart will only generate about 20 per cent of regular revenues, and until tourism returns,

the majority of his vehicles will stay parked.

As tour and coach operators start to operate again, they must evaluate their new reality. The business climate has shifted from mainly prioritizing an enjoyable trip to ensuring a product offering in locations with activities that allow for social distancing and safety and with partners who embrace the same strategy. Added protocols include: • Driver education awareness training for cleanliness procedures and preventative hygiene practices • Hand sanitizer in the front of the coach for passengers to use when boarding and exiting the coach. • Complete disinfectant cleaning of the coach prior to each new trip • Spot cleaning of high-touched surfaces with disinfectant

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These digital platforms – which are capable of spanning and connecting multiple modes of transportation that typically exist in fragmented silos – are the key to understanding ridership patterns and the flow of people and then making informed decisions off of that data. This type of digital ticketing system can also provide a safer and more pleasant ticket buying experience. Customers can purchase passes from an app on their phone or online from the safety and comfort of their desktop computer if they’re purchasing in advance. In a time when COVID-19 seems to be lurking around every corner, these purchasing scenarios are far preferable to visiting a crowded ticket office or having to use the touchscreen of a ticket vending machine.

Many transit systems have been piloting these approaches and have Conclusion been successful setting the tone for the future. With the exception of the intercity carriers, the bus industry was on a clear path of growth and integral to governments’ initiatives on climate change, urban development and infrastructure, integrated mobility and clean, healthy living.

When COVID-19 hit, our Industry was severely impacted. Schools were closed, motor coaches parked indefinitely, and urban transit, designated an essential service, had to scramble to ensure safety protocols were in place for both customers and staff. All this in the wake of a 90% drop in revenue and ridership.

Urban Transit School Bus The substantial long-term government investment in urban transit infrastructure including the progressive upgrading of fleets, was in The return to school in September was anything but smooth. place to provide a modern, accessible network of bus services to Most school bus drivers are retirees in their 60s and older, and meet 21st century expectations/requirements. In the midst of the many decided not to drive for fear of contracting COVID-19. This distress and disruption the COVID-19 crisis has created, there is left extreme driver shortages across the country, causing schedule a great opportunity for transit agencies to pause, rethink the way disruptions, delays and often cancellations. Furthermore, concerns they’ve been doing things, and embrace new technologies and new have been noted by drivers relative to respiratory conditions due to approaches that will not only create a better customer experience, strong cleaning solutions on the bus. but allow them to safely navigate the COVID-19 crisis and emerge stronger than before. COVID-19 pandemic has given rise to virtual learning. For both elementary and secondary schools an option for virtual learning, in One of the first things agencies need to do is to start making better some provinces, was available. It remains to be seen how successful use of data. By collecting and leveraging real time data about this process will be and whether elements of this process will be their operations, they can start to address the primary concerns of integrated into the school system. their customers, so that they feel comfortable embracing transit again. One approach we discussed in the report is the on-demand Several doctors and public health advocates say there are powerful service. This can address social distancing, safe space allocation, arguments for in-person schooling wherever possible, including sanitizing requirements. Gathering this type of data requires new mental health problems, hunger, obesity due to inactivity, missing ticketing systems that are primarily digital and software based routine medical care and the risk of child abuse — on top of the (apps on mobile devices or online ticket websites), in contrast to loss of education. the hardware-based systems that have long dominated mass transit (physical cards or transit passes and the physical machines that read those cards).

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Several reports and anecdotal comments vary by districts as to the level of spread attributed to schools. While there have been studies conducted early in the re-opening of schools with findings that “the data so far are not indicating that schools are a super-spreader site,” these are not conclusive and more detailed analysis needs to be conducted.

Fortunately, most operators will focus on returning to profitability but most likely will not be looking to buy coaches for a while. A spokesperson we talked to commented that “It will be a smaller industry for a while, with fewer operators, and the survivors will be reluctant to take on new debt.”

Motor Coach Industries (MCI) sees passenger confidence as that critical first step in bringing business back. It has emphasized practices and products to do just that, including designing new distancing practices for passengers and drivers, optimizing air-flow Motor Coach systems and evaluating new standards for cleaning and disinfecting A prolonged shutdown caused by the coronavirus pandemic likely throughout vehicles. will force a number of operators to go out of business. Even after “We took an informal customer survey, considered all customer business resumes, it could take a year or more before the demand requests, and listened to our Technical Solutions Managers in the for bus travel returns to pre-coronavirus levels, meaning operators field to identify three key industry restart activities – stepped-up will need fewer motorcoaches. cleaning, distancing practices to protect passengers and drivers, and Fewer operators with fewer buses on the road could, in turn, result optimizing air quality”. in a flood of motorcoaches on the resale market, thereby exerting “Some owners are requiring that the first three rows remain empty downward pressure on their values. The majority of motorcoach or are opting for driver shields and partitions to better protect the operators have had little or no business since March, when the driver and passengers. Also fogging procedures and hand-wiping virus caused the implementation of stay-at-home orders and social critical touch points are going mainstream. And operators are distancing across the country. Even major line operators, such as thoroughly communicating their efforts to get clients back on Greyhound Canada shut down and suspended service while others board.” offered only limited travel. MCI has made passenger communications a priority; designing Industry representatives tell us that even once the industry starts and sharing the customizable Extreme Clean Communication back up, recovery will be a gradual process. “To be operating the toolkit featuring Word doc templates to help companies customize way we were in the first part of March is going to take a couple of their cleaning messages when reaching out to clients and riders. years,” “We will probably have to start with 20% to 25% of our fleet and gradually pick up every six months.” Smaller operators The industry has substantial work to do to overcome negative with fewer that 10 coaches with narrow margins and low reserves public perception of bus and coach travel, exacerbated by the may find themselves facing bankruptcy and devalue of rolling COVID-19 pandemic. It is therefore imperative that the industry stock. is enabled to work in a stable and fiscally supportive legislative environment. Most important, that all stakeholders commit to delivering a high quality of transportation services that meet or exceed the legitimate needs and reasonable expectations of the public which it serves.

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While the long-term outlook for the bus industry labour market The COVID-19 crisis won’t last forever, but customer expectations appears fairly stable through 2026, with government investment, will permanently be altered by it. As a result, the need to use digitization, flexible service offerings and climate change programs data in an intelligent manner will persist long after the virus has with the purchase of electric vehicles, there are significant social dissipated. Those transit agencies and operators who can harness and technological factors, in terms of an aging workforce and real-time data and use it to guide their operations will be able to AVs, respectively, which will likely cause significant disruption. successfully navigate this crisis and attract ridership in an inclusive These issues, in addition to the stability of the interurban and system of mobility. rural bus industry, the ongoing challenges of school bus companies recruiting drivers, and other emerging challenges will be explored over the coming months.

Image: Deloitte

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ENDNOTES 1. Labour Force Survey – Data Tables 11. Statistics Canada. Table 23-10-0086-01 Canadian passenger bus and urban transit industries, equipment operated, by industry and type of vehicle 2. Job Vacancy Statistics – Data Tables 12. Statistics Canada. Table 23-10-0084-01 Canadian passenger bus and urban 3. Survey of Employment, Payroll and Hours – Data Tables transit industries, fuel consumption, by industry (x 1,000) 4. Job Vacancy and Wage Survey – Data Tables 13. Statistics Canada. Table 23-10-0087-01 Canadian passenger bus and urban 5. Employment Insurance Statistics – Data Tables transit industries, maintenance cost, by type of vehicle 6. Table 14-10-0337-01 Employment insurance beneficiaries (regular benefits) 14. Statistics Canada. Table 23-10-0083-01 Canadian passenger bus and urban by province, territory and occupation, monthly, seasonally adjusted transit industries, employment and compensation, by industry 7. Statistics Canada. Table 23-10-0081-01 Financial performance of the 15. Statistics Canada. Table 23-10-0078-01 Large urban transit statistics, passenger bus and urban transit industries, by industry revenue and passenger trips based on 10 major Canadian urban transit operators (x 1,000,000) 8. Statistics Canada. Table 23-10-0088-01 Canadian passenger bus and urban transit industries, revenue, selected provinces and regions 16. ESDC – Canadian Occupational Projection System 9. Statistics Canada. Table 23-10-0085-01 Canadian passenger bus and urban 17. Statistics Canada, The Daily – urban transit September 2020 transit industries, operating revenue, by Industry (x 1,000) 18. Bloomberg New Energy Finance. “The Electric Vehicle Outlook” 2020. 10. Statistics Canada. Table 23-10-0082-01 Canadian passenger bus and urban transit industries, capital expenditures, by industry (x 1,000)

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