Britain's bus industry could be about to enter a new area of high growth, according to Stagecoach chief executive Brian Souter.

Addressing an audience of young bus managers last week in Birmingham, Souter said the future prospects for buses were strong.

He revealed the results of a recent survey of 1,000 Stagecoach bus and rail customers. It found that a variety of factors have made people more willing to use public transport. As a result of this, Souter said that in some parts of the country the bus industry was now "pushing at an open door".

The survey found that:

* 64% of those surveyed disagreed that 'The environment is a low priority for me';

* almost half (47%) agreed that 'I use my car less';

* more than a third (36%) agreed that 'I use buses more';

* and around a fifth (19%) agreed that 'I use trains more'.

Souter told the first meeting of the new Young Bus Managers Network that the results of the survey were "unbelievable". He told the audience of around 35 young managers that he had never been more optimistic about the future of the bus industry.

"I think you are the managers in an industry that is just about to reinvent itself," he told them.

Some Stagecoach bus companies are now performing like rail companies in terms of growth, Souter said, with single-digit annual increases in passenger volumes now achieved with relative ease. In Cambridge, for example, he said the group was getting passenger growth of 9% year-on-year.

Looking at the bus industry as a whole Souter pointed out that growth in overall passenger volumes has been achieved in each of the past five years. He said it was too early for him to predict whether the bus industry would experience the kind of rapid growth seen in the rail industry over the past decade, but remarked: "Something is happening. I think it could go upwards."

Souter said that the reasons that people gave for switching from using their car to public transport were "gob-smacking". Stagecoach's survey found that availability of free passes was cited by 10% of those who had switched to public transport while 12% said that environmental considerations had led them to change their travel behaviour. However, the most commonly cited factor for modal shift was health reasons, with 20% saying that this was why they now used buses or trains.

Walking to the bus stop or rail station is seen as a good way of keeping healthy by more and more people. Souter said that a good illustration of this thinking was the number of bicycles that can now be found chained up outside of rail stations in the south of England. He urged the young bus managers to find new ways to accommodate this new demand, perhaps by using double deckers with fewer seats to create space for bicycles. "I think we are missing this," he said, Òand we ignore it at our peril."

Souter said that the desire for a healthy and environmentally lifestyle, combined with the rising price of fuel, was now giving public transport a huge opportunity to lure motorists out of their cars.

The survey found that 62% agreed that they would be more likely to travel with a company whose ethics supported the environment. Meanwhile, 32% said that they would be prepared to pay more for public transport which is environmentally friendly.

Souter told the young bus managers that they should use their intuition when running a bus company because "not everything can be proven on paper". He said investing in good quality services was vital for the future. To illustrate his point he used a quote from the late American industrialist Henry Ford: "A business absolutely devoted to service will have only one worry about profits. They will be embarrassingly large."

Souter also told the Young Bus Managers Network that more should be done to make bus staff feel positive about the company they work for. He urged managers to strive to create "humane" working schedules and hold social functions like barbecues to make staff feel like they are part of a community. He believed that this would help the industry to retain staff. "It all sounds really trite but make a desirable place to work, create a community atmosphere for people," he said. "People want to live in communities, they want to work in communities and they want to be proud of these communities they work in."

Souter said Virgin boss Sir Richard Branson provided a role model for how to make staff feel valued.