How Flixbus became a global coach travel giant

DW (English)

FlixBus is now the world's biggest intercity bus travel company. It has thousands of green buses and connects destinations all over the globe, but this success story is not without challenges and criticism.

Transcript

00:00Buses aren't just one of the most sustainable ways to travel.

00:04The bus is much cheaper, like half price.

00:07And budget operator Flixbus has been dominating intercity bus travel in Europe for some time now.

00:13We are already now in the biggest bus markets on earth.

00:17And now the company is expanding beyond borders and exceeding expectations.

00:24You can see it as a country, but it's actually not.

00:30Germany lifted its ban on intercity bus travel in 2013.

00:34And since then, those signature green buses have become a symbol of affordable and sustainable travel

00:40in Germany, Europe and around the world.

00:44But from the beginning, Flixbus was more than just a bus operator, as people tend to think.

00:50So what we propose to bus companies now all across the globe is

00:54they focus on the operations and we are the technology layer.

00:58In that sense, we develop technology for network planning, for pricing,

01:02for marketing, for operations, for customer service.

01:05And we deploy that on a global base.

01:09This business model, combined with leveraging data analytics,

01:13is allowing Flixbus to rapidly expand its network.

01:17The company had a humble start in 2013 with just a few routes in Bavaria.

01:22Soon enough, operations expanded to cover all of Germany.

01:26And now thousands of Flixbuses link up more than 5,600 destinations

01:31in 44 countries across four continents.

01:38That ambition to expand has not been without its critics.

01:42While Flixbus' growth to become the world's largest intercity bus travel company is impressive,

01:47it's also raised concerns about fair competition, potential market monopolisation

01:52and the implications for regional operators struggling to compete.

01:58The criticism grew particularly loud in 2021 after Flixbus acquired Greyhound Lines,

02:04the largest long-distance bus operator in the United States,

02:08and fittingly, at a discount price.

02:10We always say we are pro-competition. We need open markets, no barriers,

02:14and, of course, a regular environment where we ensure safety and quality.

02:18That's totally clear.

02:19But besides that, let competition at the end bring the best product.

02:24In February 2024, Flix made its entry into India.

02:28The subcontinent represents an enormous opportunity for the company,

02:31with India becoming a global tech hub.

02:34Why India? India is, outside of China, the largest tech hub in the world.

02:39Outside of China, the largest bus market in the world.

02:41It's a market which is where bus is used as the backbone of people getting around.

02:47So a lot of money and investment going into creating better roads and better infrastructure.

02:53With rapid expansion, the workload on drivers has increased.

02:58Flix has faced criticism over working conditions and unpaid overtime.

03:04There have been some horrible and fatal accidents.

03:07Some drivers have reportedly had to be on the road for more than 200 hours a month.

03:14Chile. India. Mexico.

03:19As FlixBus enters diverse markets, the company faces the complexities

03:23of differing regulations, cultural nuances and operational challenges.

03:28Chile is larger than any European market.

03:31If you look at Mexico, this is like multiple the times of the market of the US.

03:36If you're in India, we have to be an Indian company.

03:39If you're in Chile, we have to be a Chilean company.

03:41And in Germany, we have to be a German company in that sense.

03:44For India, the most populous country in the world,

03:47a single service can't cover the entire market.

03:52So you need to understand what markets you're in.

03:55So you need to understand what market you're serving,

03:58what customer you're serving, and what you need to deliver for them.

04:01And I think that is the biggest challenge that you have for a market as big as India,

04:06that you can see it as a country, but it's actually not.

04:09It's small, small, small, small, mini marketplaces and mini businesses.

04:13Flix operates on an asset-light business model

04:16that involves partnering with local bus companies around the world.

04:19They manage daily operations, while Flix handles the tech infrastructure.

04:24But how does a local company benefit from this?

04:32It's now different from chartering, where a group would want to hire our buses

04:36and we'd need to provide them immediately.

04:39Now we can say which routes we're operating in two, three or four weeks' time

04:44and then plan the buses accordingly.

04:49Flix wants to continue to expand and grow.

04:52According to the announcement, the next destination will be Mexico,

04:56the third largest long-distance bus market in the world.

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