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Global Rail Industry Restructuring Brightens Market Participant Prospects Finds Frost & Sullivan - Planned removal of state-run monopolies ensures proper use of rail funding - Transportation.Frost.com
Global Rail Industry Restructuring Brightens Market Participant Prospects Finds Frost & Sullivan

 

NewswireToday - /newswire/ - Mountain View, CA, United States, 2014/10/16 - Planned removal of state-run monopolies ensures proper use of rail funding - Transportation.Frost.com.

   
 
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The global rail market will offer numerous opportunities for market participants as the result of restructuring and priority rail projects which will drive sales and private investment in the industry. As such, the global market will remain on a steady rail-freight and passenger-volume growth path, even though certain regions such as Africa and Eastern Europe are still running limited rail services.

New analysis from Frost & Sullivan’s Executive Analysis of the Global Rail Industry 2014 finds:

• Passenger traffic increase: from 3,196.28 billion passenger-kilometers (pkm) in 2013 to 4,739.18 billion pkm in 2020
• Rail freight traffic increase: from 10,168.37 billion ton-kilometers (tkm) in 2013 to 12,332.84 billion tkm in 2020

The study covers the segments of rolling stock and infrastructure.

“As far as high-speed rail (HSR) services are concerned, Asia-Pacific and Europe are the largest markets in the world, accounting for over 81.60 percent of global investments in this segment,” said Frost & Sullivan Automotive & Transportation Research Analyst Shyam Raman. “With Deutsche Bahn placing orders for 300 HSR rolling stocks to provide its Intercity-Express services, Germany is anticipated to be among the top three markets by 2020. These investments in HSR will have a cascading effect on investments in other segments of the global rail industry.”

However, insufficient funding, low sales volumes in some countries and political instability are constricting the overall growth of the global rail sector. As fixed costs contribute to at least 70 percent of the total cost of rail rolling stock and infrastructure, market participants can bear these costs only in countries where sales are robust and high economies of scale possible.

Therefore, it is not surprising that states across the globe contribute economically to rail construction within their territory. In fact, states tend to monopolize the railway industry, both owning and operating it. This often leads to negligent behavior towards customers and deteriorating infrastructure as well as the creation of unfair barriers for potential market entrants.

“Recognizing that the elimination of state-run monopolies is necessary to make proper use of funding in rail, rapid restructuring is underway globally to boost the competitiveness of the industry,” noted Raman. “Restructuring priorities include the separation of the state, regulator and operating companies as well as the establishment of clear roles for policy makers, regulators, owners of assets and service operators. Eventually, vertically separated rail markets will become the standard globally.”

Executive Analysis of the Global Rail Industry 2014 is part of the Transportation & Logistics (transportation.frost.com) Growth Partnership Service program. Frost & Sullivan’s related studies include: Strategic Dashboard of Global Rail Passenger Volumes, Strategic Analysis of Light Rail Transit in North America, Strategic Analysis of the Chinese Rolling Stock Market, and Rail Outlook Study 2013-2022. All studies included in subscriptions provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants.

About Frost & Sullivan
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Executive Analysis of the Global Rail Industry 2014 / ND6B-13

 
 
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Global Rail Industry Restructuring Brightens Market Participant Prospects Finds Frost & Sullivan

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Frost & Sullivan | Transportation & Logistic
Publisher Contact: Jennifer Carson - Frost.com 
210-247-2450 jennifer.carson[.]frost.com
 
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