Railway Track Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The railway track market is anticipated to register a CAGR of about 3% during the forecast period (2020-2025).

Key Highlights

• The rapid urbanization, traffic congestion, and increasing railway network of major countries are expected to fuel the demand for railway tracks during the forecast period. The market is witnessing the active participation of governments to expand the existing rail networks and enhance this cheapest and safest means of transportation, to make it more comfortable and eco-friendly.
• Rail freight transport is one of the cheapest means of goods transport. According to IEA, around 7% of the global freight transportation is being carried out through rail networks. In some countries, such as Russia, more than half of the goods transport is done through rail. Similarly, metro systems provide cheap and convenient urban transportation in around 200 cities worldwide, with more than 32,000 km of rail length. As cities are turning to greener transportation alternatives, metro rails are expected to grow at a much faster rate, which may boost the demand for tracks in the future.
• The European Union (EU) has the largest electrified rail length, as well as one of the safest railway networks, in the world, with around 218,000 km of the active rail network. The EU commission is committed to making its rail network more convenient for passengers, by introducing various laws and inviting private industry players to advance the current network. For instance, the EU commission has a target of moving 30% of freight traveled by a distance more than 300 km for other modes of transport (rail or water), by 2030.

Key Market Trends

Expansions of Rail Network Driving the Railway Track Market

The expansion and electrification activities of the major rail networks are being carried out across the world, to promote the most eco-friendly means of transport. In most of the biggest rail network countries, management is under the control of private players. However, at the same time, governments have some control over the rail network operations. For instance,

• In 2019, the Transport Ministry of Germany announced its plans to invest around USD 69 billion in the up-gradation of railway networks over the next 10 years, with approximately USD 26 billion to be contributed by Deutsche Bahn. About 33,000 km of the railway network of Germany has dilapidated bridges and overused train tracks.
• In 2017 the UK government announced that to invest around USD 50 billion in the modernization of rail network from 2019 to 2024. In January 2020, the UK government planned to invest around USD 550 million for the restoration of the previously closed rail lines to boost the connectivity within the country.

Asia-Pacific Is Expected to Lead the Railway Track Market

The Asian economies, such as China, India, and Japan, top the list of passenger-kilometer per year. In addition, major manufacturers of the railway track market are headquartered in this region. Local governments are putting more and more capital for advancing the present rail network. For instance,

• In 2018, China invested USD 117.12 billion in fixed rail assets.
• India, which has the fourth-largest rail network in the world, has a state-owned rail network. In 2019, the Indian government’s PSU Ircon International Limited signed a USD 91.26 million contract agreement with the Sri Lankan government, for the up-gradation of old tracks of around 130 km between Colombo and Tamil Nadu. Till now, India has provided around USD 1.3 billion Line of Credit for the development of the railways in Sri Lanka. Furthermore, the Indian railway is replacing the traditional steel tracks to zinc-coated tracks where the chances of corrosion are high.

Competitive Landscape

The railway track market is consolidated with the presence of a limited number of active players, owing to the requirement of high initial investment costs, experience, and a high-level of technological requirements. Some of the major players in the market are Voestalpine Schienen GmbH, Nippon Steel Corporation, and AGICO Group, among others. The companies are grabbing contracts from the rail management companies and forming strategic alliances with other players in the market. For instance,

• In 2018, Jindal Steel and Power Limited won the first-ever global tender for rail track by the Indian railways, worth USD 7 billion, to supply 126 million metric ton of rail track. In 2019, the company successfully supplied around 97 million metric ton of railway track to the Indian railways.

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• The market estimate (ME) sheet in Excel format
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