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PUBLISHER'S COMMENTARY


Momentum Shift WRITTEN BY TONY CORPIN | TONY@STNONLINE.COM I


t’s common at sporting events to witness a sud- den momentum shift from one team to another. Tat turn over the past year is most evident with school bus production numbers.


Te recent OEM data our team collected certainly paints a strong economic picture. Te trend of new buses manufactured is great measurement on our industry’s health. And I’m happy to report it’s been another positive growth period, with another 5 per- cent, year-over-year bump in new bus manufacturing per our annual Bus OEM survey. Te survey reported that about 33,900 Type C & D class school buses were built along with about another 9,400 Type As for a grand total of 43,302 school buses produced. In addition, the alternative energy school bus trend continues to thrive, based on reported numbers. Pro- pane buses remain the leader with about 3,500 units produced, followed by CNG at another 500 units and electric buses at lower double-digit volumes. Tese figures are representative of the most recent production cycle that ended on Oct. 31, 2016. Per the U.S. Energy Information Administration, diesel fuel prices have been holding in a range of a low at $1.98 reported on Feb. 22, 2016 to a high of $2.493 reported on Dec. 12, 2016. Fuel is trending higher partly because of pending negotiations on OPEC pro- duction reductions. Fuel remains a volatile commodity, but I believe our industry will see diesel fuel prices go higher in 2017. Granted, some school districts and private contractors take advantage of bulk purchasing rates, but I wouldn’t turn a blind eye to this budget line item. Look for pricing of propane and CNG to also become more of a factor. Headlines regarding energy costs and fuel were prominent in 2016, and I’d expect to see more of the same this year. And if diesel prices continue to rise, I predict alternative fuels only taking a bigger foothold in school transportation going forward. Additionally, be sure consider fuel hedging options to manage your future fuel costs. More to come on that topic in a future magazine issue. One question I regularly receive is, “Where do you see the funding going for school transportation next year?” I believe the best answer is, “It depends.” Last year, I cited lower fuel costs helping budgets, but I don’t think that will be the case in 2017. Property


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taxes from real estate are a huge funding mechanism to fund operations for cities, school districts and student transportation departments. According to the National Association of Realtors, existing-home sales rose in October 2016 for the second straight month, eclipsing June’s cyclical sales peak to the highest an- nualized pace in nearly a decade. With the real estate market maintaining strong growth and higher values, this should help drive more funding into education. But understand that this differs by geographic region, and not everyone is getting equal funding, if any at all. President Trump’s administration, and rising interest rates, may also have an effect. Another momentum shift is coming as result of the tragic school bus crash in Chattanooga, Tennessee that has shined the national spotlight on the school bus industry. In speaking with multiple industry leaders and transportation directors, I’ve heard the same thing over and over, “It’s a game changer!” One transportation director I spoke with said he’s investing in lap-shoulder seat belts immediately, as the amount of internal support and parent pressure is enormous. Outfitting his fleet will take time, but he feels it’s been a real wake up call to the community and educational leadership on the importance of safety equipment on school buses. With pending Federal legislation and a potential funding mechanism behind it, will school bus industry come together in 2017 embracing seat belts putting an end to the “Great Seat Belt Debate?” Or will it only heat up more? Helping improve the safety and efficiency of your fleet is a great New Year’s goal. Be sure to work with your industry suppliers and discuss how to do just that. Explain the “What and Why” to help clearly identify your goals and “How and When” to achieve them. Tere are more than 300 companies represented in our Products and Services Suppliers section as well as hun- dreds of school bus dealers in the OEM section. Please reach out and let them help your team in 2017!


Tony Corpin, Publisher


CELEBRATING25YEARS


School Transportation News Magazine | Buyer’s Guide 2017


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