The rail components market is expected to exhibit a CAGR of 2.73%, during the forecast period (2020-2025). The rail components market is driven by developments in global railway Industry. Some of the prominent factors that drives the growth of the market are as follows -
- Population growth and rapid urbanization - By 2050, the population is expected to reach 10 billion and the total share of population living in urban areas will grow to 68% by 2050
- Stringent government rules regarding greenhouse emission and pollution is driving the market growth for electric locomotives.
- Most of the railway rolling stock operations in the world is owned by the government and public sector. This is a good sign for future growth of railway component industry because government and public sector will continue to fund railway projects.
- Digitalization is a major disrupting factor that will drive the growth of railway component market. This is an era of fast and safe transportation. Many major manufacturers such as Siemens, Wabtec are using an array of sensors on their locomotives to use IoT and Big Data Analytics for making the freights safe, fast and fuel efficient.
- Currently, China dominates the market for rolling stock and rail components, in terms of market value and volume, owing to the higher concentration of manufacturing facilities and operating number of rolling stocks in the country.
Key Market Trends
Global growth for Railway Market
The three largest markets for railway products are Europe, North America and Asia-Pacific and they collectively represent 80% of the market. Rolling Stocks, Infrastructure development and services constituted nearly 90% of the market.
North America, Middle-East and Africa and Latin America were expected to grow at above average rates than of Industry. According to UNIFE, there are 114,000 locomotives in the world of which 33% are in Asia-Pacific. There are nearly 5.1 million freight cars of which 33% are located in North America.
Germany, France and UK are the largest transit market in western Europe representing 75% of industry investing. UNIFE expects the western European market to grow by 2.3% owing to the investments in rolling stock by Germany and France.
In North America, 40% of intercity freight is carried by through railways. The growth in US is driven mainly by new innovations, production of new freight and locomotives, federal and state funding and rail traffic. There are more than 500 operational railroads in North America with Class I (largest railroad) railroads delivering 90% of the revenue. The railway market is affected by the fluctuations in various industries such as coal, metals, agriculture, petroleum and chemicals.
Asia-Pacific is the Fastest Growing Region
Asia-Pacific dominates the rail components market. The region is expected to witness the fastest growth rate during the forecast period.
In the Asia-Pacific region, India is one of the largest and fastest growing market for railway components after China. India is expected to witness the fastest growth during the forecast period. India is making investments in rolling stock to upgrade its rail transportation system. Owing to the growth in population, intercity trade and commuting, upcoming metro projects (13 operational, 6 under construction, 7 in planning stage and 8 in proposed stage) and extension of existing lines, the Indian rolling stock market is witnessing a steady growth.
As of 2019, India has 716 km of operational metro lines. In early 2019, the Ministry of Railways increased the allocation toward the procurement, upgradation, and maintenance of rolling stock by 64%. Indian Railway revenues from passenger business grew at the rate of 5.58% from 2017 to 2019 and reached USD 7.3 billion in the financial year 2018-19. India recently ordered 1000 units of locomotives from GE transportation. Indian Government is also considering a bullet train between Mumbai and Ahmedabad (Mumbai Ahmedabad High Speed Rail Corridor).
India's railway and related component exports grew at a rate of 27.1% between 2010 and 2017. Railway exports were recorded at USD 278.1 million in 2018. India has received a total FDI of USD 969.28 million from 2000 to 2019.
The government's Make in India initiative laid special emphasis on promoting manufacturing activities within the country. This, in turn, is expected to drive the market for rail components in India. In 2018, Alstom, a France based company, announced its plans to upgrade its Sri City facility's coach production capacity from 20 cars to 24 cars per month. It will also open a new production line to increase the production capacity to 44 cars by the end of 2019.
The market for rail components is a consolidated one with the top four major players holding more than 50% of the market share. Other important players, such as Hitachi, Wabtec Corporation, CAF, The Greenbrier Companies, and Kawasaki Heavy Industries, hold a relatively smaller market share, and they are in the process of expanding their operations in both home and international markets.
- Bombardier won a 26.8 million Euro contract for refurbishment, maintenance and upgradation of 59 bombardier Swedish Regina Electric Multiple Units fleet.
- A contract of USD 1.2 billion has been awarded to China Rail Construction Corporation (CRCC) by Etihad rail for development of stage 2 of Package D.
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Table of Contents
- 1.1 Study Assumptions
- 1.2 Scope of the Study
2 RESEARCH METHODOLOGY
3 EXECUTIVE SUMMARY
4 MARKET DYNAMICS
- 4.1 Market Drivers
- 4.2 Market Restraints
- 4.3 Industry Attractiveness - Porter's Five Forces Analysis
- 4.3.1 Threat of New Entrants
- 4.3.2 Bargaining Power of Buyers/Consumers
- 4.3.3 Bargaining Power of Suppliers
- 4.3.4 Threat of Substitute Products
- 4.3.5 Intensity of Competitive Rivalry
5 MARKET SEGMENTATION
- 5.1 By Component
- 5.1.1 Bogie
- 22.214.171.124 Brake System
- 126.96.36.199 Suspension System
- 188.8.131.52 Wheel and Axle
- 184.108.40.206 Other Bogies (Gear Box, Motor, and Supporting Frames)
- 5.1.2 Engine
- 5.1.3 Other Components (Couplers, Body Frames, etc.)
- 5.2 Geography
- 5.2.1 North America
- 220.127.116.11 United States
- 18.104.22.168 Canada
- 22.214.171.124 Rest of North America
- 5.2.2 Europe
- 126.96.36.199 Germany
- 188.8.131.52 United Kingdom
- 184.108.40.206 France
- 220.127.116.11 Rest of Europe
- 5.2.3 Asia-Pacific
- 18.104.22.168 China
- 22.214.171.124 Japan
- 126.96.36.199 India
- 188.8.131.52 South Korea
- 184.108.40.206 Rest of Asia-Pacific
- 5.2.4 Rest of the World
- 220.127.116.11 Brazil
- 18.104.22.168 South Africa
- 22.214.171.124 Other Countries
6 COMPETITIVE LANDSCAPE
- 6.1 Vendor Market Share
- 6.2 Company Profiles
- 6.2.1 CRRC Corp. Ltd
- 6.2.2 Siemens AG
- 6.2.3 Bombardier Inc.
- 6.2.4 Alstom SA
- 6.2.5 Wabtec Corp. (previously GE Transportation)
- 6.2.6 Hyundai Rotem
- 6.2.7 Stadler Rail AG
- 6.2.8 The Greenbrier Companies
- 6.2.9 Trinity Industries Inc.
- 6.2.10 Construcciones Y Auxiliar De Ferrocarriles SA
- 6.2.11 Escorts Group
- 6.2.12 Hitachi Ltd
- 6.2.13 Progress Rail (Caterpillar Company)
- 6.2.14 Nippon Sharyo Ltd
- 6.2.15 Kawasaki Heavy Industries Ltd
7 MARKET OPPORTUNITIES AND FUTURE TRENDS