"I think what the Chinatown operations did in New York and Washington, they came into communities where the customer was and picked up there," Pantuso says. "That's the model you see now, where they're no longer just picking up at terminals."

In New York City, Megabus forsakes the Port Authority Bus Terminal for a curbside stop near the train routes of Penn Station. It helped Megabus increase almost double traffic between October 2007 and October 2008, with Boltbus and carriers like Washington-bound DC2NY and Vamoose following suit. While this strategy failed in Los Angeles, where Megabus ceased service last year, it has proven popular among students, vacationers and even corporate travelers in the Northeast and helped Megabus expand into 28 cities and add 4.5 million passengers a year in three years.

"We work closely with all the city officials and the department of transportation in every city we operate," says Megabus CEO Dale Moser. "We are always looking for some kind of intermodal connectivity, and that's a strategy that comes over from Europe."

Megabus has expanded its fleet of 81-passenger double-decker buses from 16 to more than 110, while a First Group spokeswoman says Greyhound introduced a fleet of 102 new buses in the Northeast this year that have not only wi-fi, but seat belts. Not to be outdone, Greyhound is sprucing up terminals with flat-screen TVs, expanded food offerings and other services. The images of derelict depots and cramped, smelly, decaying coaches is shrinking in the rearview.

"That stigma's faded a lot quicker than I could have imagined," Schwieterman says. "I would ride Greyhound about once every two years and my students would look at me like I was nuts."

-- Reported by Jason Notte in Boston.
Jason Notte is a reporter for TheStreet.com. His writing has appeared in The New York Times, The Huffington Post, Esquire.com, Time Out New York, The Boston Herald, The Boston Phoenix, Metro newspaper and the Colorado Springs Independent.

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