Rolling Stock Market

[382 Pages Report] The global rolling stock market size was valued at USD 54.6 billion in 2023 and is expected to reach USD 65.6 billion by 2028, at a CAGR of 3.8% from 2023 to 2028. The global demand for rail vehicles is fueled by the rising population in urban areas, which puts significant pressure on the existing transportation infrastructure and necessitates expanding the network infrastructure. This has, in turn, increased the demand for rolling stock during the last few years.

Inadequate infrastructure and degradation of air quality are some of the key concerns in major metropolitan cities. High gasoline prices, traffic congestion, and greenhouse gas emissions are some of the other challenges for city dwellers. In such a scenario, public transportation offers several benefits over private conveyance. Urban transit systems help reduce traffic congestion and are more energy-efficient than other modes of transport. They also offer commuters a cost-effective alternative to personal transportation and help reduce their carbon footprint. Rolling stock is predominantly used for passenger transportation in the Asia Oceania and European regions. According to the International Union of Railways’ 2022 synopsis, Asia Oceania and Europe accounted for 85% and 11% of the total passenger kilometer (million) traveled, respectively. Asia Oceania and European region has major market players such as CRRC Corporation Limited (China), Alstom SA (France), Siemens AG (Germany), Stadler Rail AG (Switzerland) and others that offer a rolling stock with advanced features for end-use applications. The implementation of new technologies and the rising government investment towards railway industry drive the rolling stock market trends in this region. For instance, in its Union budget 2022-23, the Indian government allocated Rs. 140,367.13 crore (USD 18.40 billion) to the Ministry of Railways.

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Market Dynamics:

Driver: Increasing electrification of railway networks

Rising concerns regarding a greener environment have increased the demand for non-polluting and energy-efficient transport systems globally. Additionally, the oil-importing countries are also planning to reduce their oil dependency, thereby looking for an alternative energy source. As a result, most countries prefer electricity as a source of energy for various rolling stocks. This resulted in the increasing electrification of railway networks all over the world. Therefore, the demand for electric locomotives and EMUs is rising at a rapid pace globally. Countries are also replacing their old diesel locomotives and DMUs with electric locomotives and EMUs, respectively.

For instance, in 2021, South Korea announced its plan to completely phase out all diesel-hauled passenger trains in the country and replace them with new electric bullet trains by 2029. In March 2022, the Germany-based industry association VDV announced that the German rail network will be further electrified in the coming years. This could, however, be done at a faster pace by doing away with a preliminary environmental impact assessment and the planning approval requirement. In Germany, currently, around 60% of the railway lines are electrified. The VDV advocates a degree of electrification of 75% of the network. This will provide the necessary boost to the rolling stock industry. Currently, the electrification of railway networks is higher in Russia, Japan, and South Korea. India also has a well-electrified rail network. Currently, three zones of Indian railways have achieved 100% electrification: Kolkata Metro, West Central Railway, and East Coast Railway.

Restraint: Refurbishment of existing rolling stock

The demand for lower travel costs and the necessity to enhance vehicle capacity have both strengthened the market for rolling stock refurbishment. It is necessary to expand the current fleet to handle the rising passenger demand. The rolling stock of various rail franchises currently has a capacity that is insufficient to handle the rising demand. Refurbishment is therefore a practical option for increasing capacity and offers a chance to fix known reliability issues, enhance train energy efficiency, and modernize vehicles to meet needs.

Notable examples of refurbishment programs are Eversholt’s (UK) upgrading project and the Renatus program. The program involves modernizing 30 four-car class 321 EMUs leased by Abellio Greater Anglia (UK). The financial constraints in acquiring new trains also contribute to the increasing number of rolling stock refurbishment programs. In July 2022, The Passenger Rail Agency of South Africa (PRASA) has awarded five contracts worth a total USD 459.3 million for the refurbishment of rolling stock across the network. The five years contract have been awarded to Armature Technology, CTE Investment, Karabo Nhlamolo Project Cooperative, TMH Africa and YNF Engineering, with 380 and 400 EMU cars to undergo heavy maintenance and rehabilitation work every year. Additionally, Chrysalis Rail announced re-opening its South Wales depot for rolling stock maintenance, the latest rolling stock refurbishment projects, and overhaul projects. The new rolling stock market forecast is expected to be impacted due to the increase in refurbishment programs and the opening of factories for rolling stock refurbishment. Refurbishing existing rolling stock reduces the need to purchase new vehicles and is expected to therefore restrict the market growth.

Opportunity: Big data applications in rail industry

An improved travel experience, including onboard internet and entertainment, smart tickets, automated fare collection, and door-to-door services, is something that passengers are increasingly looking for. Currently, players in the transportation sector are looking into how to leverage big data collected from passengers' smart devices to perhaps enhance the economic models of urban rail networks and the caliber of services. Real-time prediction algorithms, scalable data structures, big data communications, and the use of visualization tools are the main goals of using big data and big data analytics.

Application of big data analytics can assist in understanding organizational, technological, and operational problems associated with railway transportation, as well as its effects on the economy. Big data analytics delivers data on the Traffic Management System (TMS), TMS decision-making, remaining life, maintenance-related service, and energy resources. Additionally, it enables rail operators to forecast ridership numbers and improve their product lineup. Big data makes it possible to better analyze the state and prognosticative behavior of rolling stock. Therefore, big data and intelligent rail systems can lower maintenance costs, minimize raks, and increase safety in the railway industry. The Central Organization for Modernization of Workshops (COFMOW), Indian Railways, awarded a contract to Wabtec Corporation in 2022 for its online monitoring of rolling stock (OMRS) project. This makes it possible to find problems with wheels, brakes, bearings, axes, and other parts for all maintenance, speeding up turnaround and improving safety.

Challenge: High overhaul and maintenance costs

Rolling stock needs to be periodically overhauled to ensure its reliability. However, regular maintenance and overhaul of rolling stock are highly expensive. For example, the annual maintenance cost of a high-speed trainset is USD 1 million. In addition to the cost of components that need to be replaced regularly, there is also the need for the maintenance of infrastructures such as depots and berthing sites. Rolling stock requires long-term maintenance when the train has reached half its operational life. This includes maintenance of electrical, mechanical, and hydraulic components of the vehicle. Large investments are required for such maintenance. In April 2022, Alstom SA signed a long-term maintenance contract with Alpha Trains Group, one of Europe's leading rail vehicle rental companies. In December 2022, VR FleetCare won a contract under a tender organized by the Helsinki Metropolitan Area Rolling Stock for the refurbishment of Flirt electric train bogies.

The Rapid transit segment is expected to be the largest growing segment during the forecast period

Increasing urbanization is the major reason for the growth of intercity and intracity transportation. Increasing adoption of rolling stock and rising investments by governments for infrastructure developments are expected to propel the growth of the rapid transit segment. In January 2023, LE TRAIN, France's leading private high-speed train operator, and Talgo signed an agreement in Bordeaux for the future development of a fleet of high-speed trains adapted to the French market and based on the leading high-speed Avril platform. In August 2022, Hyundai Rotem signed a USD 656 million contract to locally produce rolling stock for the Cairo Metro. The company will produce 40 trains comprising 320 carriages for Metro lines 2 and 3 alongside the National Egyptian Railway Industries Company (NERIC). The firm will also provide maintenance services for eight years. In January 2022, Strukton (Netherlands), a railway company, entered into a contract with the Stockholm Regional Council for the expansion of metro lines. Thus, with such new projects aimed toward rail connectivity, the demand for rolling stock will increase during the forecast period.

CRRC Corporation Limited (China), Alstom SA (France), Siemens AG (Germany), Stadler Rail AG (Switzerland), etc., offer a DMUs, EMUs, Light rail and Metro for end-use applications. So, the rapid transit segment is estimated to grow significantly over the forecast period.

Rolling Stock Companies

Rolling Stock companies focusing on electric & hybrid railways due to the ongoing focus on sustainable & clean mobility

The shift twards railway electrification are creating lucrative opportunities for rolling stock companies with increasing their product expansion towards electric locomotives. Prominent rolling stock companies are investing highly in R&D. For instance, Alstom is investing in technologies such as regenerative braking, lightweight materials, and energy-efficient traction systems to reduce energy consumption and emissions. In the forecast period demand for electric locomotives and EMUs will grow at a rapid pace globally, especially in Asia Pacific region. Countries are also replacing their old diesel locomotives and DMUs with electric locomotives and EMUs, respectively. For instance, In March 2023, Siemens Mobility Austria GmbH received an order from ÖBB for additional 27 Siemens Desiro ML electric trainsets. Leading rolling stock companies such as Siemens AG, Alstom SA, CRRC, Hyundai Rotem Company and others have an agreement with various government railway organization to supply the electric locomotive for instance, In March 2023, Alstom SA successfully delivered 300 electric locomotives to the Indian Railways. Such development will gain a competitive advantage for the companies operating in the market.

Rolling stock manufacturers

Rolling stock manufacturers are also gaining more opportunity due to railway network electrification. Electric locomotives and EMUs produce zero emissions, so they are a more environmentally friendly option than diesel locomotives. This can make rolling stock manufacturers more attractive to investors and customers who are concerned about the environment. Rolling stock manufacturers such as Stadler Rail AG, CRRC, Wabtec Corporation, and others are providing various hybrid locomotive such battery electric, hydrogen battery which will help them to acquire the market share. For instance, in July 2023, Austrian Federal Railways (ÖBB) has awarded Stadler a framework agreement for up to 120 battery-powered trains. Also, Government in various region are increasing investment on railway network electrification which provide opportunity for rolling stock manufacturers. Due to increasing railway electrification and supply contract in emerging economies will provide the growth opportunities for the rolling stock manufacturers.

The Asia Oceania market is projected to hold the largest share by 2028

The Asia Oceania region is the largest market for rolling stocks due to increased production, domestic demand, and capacity expansions by rolling stock manufacturers. The region comprises some of the fastest-growing economies in the world, including China and India, offering opportunities for rolling stock manufacturers. Governments in these countries have recognized the growth potential of the rolling stock market value.  According to official data of Indian Railways, USD 23.5 billion (Rs. 191,162 crores) of revenue has been earned so far in the current fiscal year (FY23), China is also planning to invest USD 155 billion in expanding the railway network in the Yangtze River Delta (YRD) region under its 14th five-year plan period (2021-25). Japan is a technology leader in the market. The country is continuously investing in the development of innovative technologies in rolling stock. Previously, the rolling stock industry in South Korea was dependent on technologies developed by France and Japan. However, companies such as Hyundai Rotem are bringing technological developments in the country’s market.

Key Market Players

The global rolling stock market is dominated by major players such CRRC Corporation Limited (China), Alstom SA (France), Siemens AG (Germany), Stadler Rail AG (Switzerland), and Wabtec Corporation (US). These companies offer extensive products and solutions for the Railway industry; and have strong distribution networks at the global level, and they invest heavily in R&D to develop new products.

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Scope of the Report

This research report categorizes the rolling stock market based on Product Type, Locomotive Technology, Component, Application, and Region.

Based on the Product type:

• Locomotives
  • Diesel Locomotives
  • Electric Locomotives
  • Electro-Diesel Locomotives
• Rapid Transit
  • Diesel Multiple Unit (DMU)
  • Electric Multiple Unit (EMU)
  • Light Rails/Trams
  • Subways/Metros
  • Monorails
• Coaches
• Wagons
• Others

Based on the Locomotive Technology:

• Conventional Locomotives
• Turbocharged Locomotives
• Maglev 

Based on the Component:

• Train Control Systems
• Pantographs
• Axles
• Wheelsets
• Traction Motors
• Passenger Information Systems
• Brakes
• Air Conditioning Systems
• Auxiliary Power Systems
• Gearboxes
• Baffle Gear
• Coupler

Based on the Application:

• Passenger Transportation
• Freight Transportation

Based on the Region:

• Asia Oceania
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Malaysia
• North America
  • US
  • Mexico
  • Canada
• Europe
  • Germany
  • France
  • Spain
  • Italy
  • Uk
  • Switzerland
  • Austria
  • Sweden
• Middle East and Africa
  • South Africa
  • UAE
  • Egypt
  • Iran
• Rest of the World
  • Brazil
  • Russia
  • Argentina

Recent Developments

• In April 2023, Siemens Mobility expanded its manufacturing and services facility in Munich-Allach in order to meet the growing demand for locomotives and services. The factory will be enlarged to 80,000 m2 from its current 50,000 m2 to provide additional capacities for processing new orders, optimizing production and logistics flows within the facility, and adding more office space.
• In March 2023, Alstom SA inaugurated a new production site in Valmadrera (Lecco, Italy) dedicated to railway electrification. The new plant will develop and manufacture power transmission components for railway, metro, and tram lines.
• In January 2023 CRRC Corporation Ltd. (China) has developed the 1st train of Qingyuan Maglev train. It adopts a 3-car formation, with cabs at both ends of the train and a carriage equipped with a mixture of vertically arranged double-row seats and horizontally arranged seats. With a total seating capacity of 315 people, the train can hold 500 passengers, and support different speeds in "3+3" formation.
• In November 2022, Deutsche Bahn AG (DB) concluded a development partnership for long-distance rail transport with Siemens AG following a tender. In the first half of 2023, the two companies will work together on developing their vision of a new-generation high-speed train. Once the concept has been completed, a further tender is expected to follow in the second half of 2023 for the development, construction, and certification of the new fleet.
• In September 2022, Siemens Mobility presents the Mireo Plus B battery train to the public for the first time at InnoTrans 2022. The Landesanstalt Schienenfahrzeuge Baden-Württemberg (SFBW) has ordered 27 Mireo Plus B trains from Siemens Mobility in 2020. The two-car electric trainsets with 120 seats can operate on rail routes with or without overhead power lines. Delivery of the multiple units is scheduled between June and December 2023.
• In June 2022, Wabtec Corporation completed its acquisition of Collins Aerospace’s ARINC rail solutions business segment, a rail dispatch and back-office system provider.
• In May 2022, India-based Medha Servo Drives signed a joint venture (JV) agreement with Swiss railway rolling stock manufacturer Stadler Rail AG for a new rail coach manufacturing factory in the Indian state of Telangana.

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