Discount Carriers Revive Bus Industry

If all you did was follow the headlines, you'd think it's been a lousy summer for the bus industry. In July, Greyhound made news when a Canadian man was decapitated by a fellow passenger on a bus trip to Winnipeg. A week later a bus in Texas drove off a bridge, killing 17 people. And, of course, swollen gas prices must be ruining the industry's bottom line, right?

In fact, the bus biz is enjoying a renaissance. Ridership is up for the first time since 1960, thanks to the rise of discount carriers such as Megabus, and Greyhound's BoltBus. With cheap fares and slick new buses equipped with Wi-Fi and electrical outlets, companies have lured travelers looking for a dependable ride on someone else's gas dime. And no dingy bus stations: the new carriers offer strictly curbside pickup.

"We're remaking the image of the bus," says Megabus president Dale Moser, whose company offers Web fares as cheap as $1. In May it expanded from the Midwest into the jampacked Northeast corridor, which already has 12 passenger-bus lines. "I don't think they'll all survive," says DePaul University transportation professor Joe Schwieterman. "It's never been this competitive." Or this cozy.