Railroads Market Size, Share & Trends Analysis Report By Type (Passenger Rail, Rail Freight), By Region (U.S., Europe, Asia Pacific, Middle East, Rest of the World), Competitive Landscape, And Segment Forecasts, 2018 - 2025

Industry Insights

The global railroads market was valued at USD 508.5 billion in 2016 and is projected to grow at a CAGR of 5.7% during the forecast period. The key factors responsible for the growth of the market can be increasing investments by the governments in the various countries to improve the railway infrastructure & to build new lines and growing tourism industry in Asia Pacific and European countries. In addition, rapid insutrialization in the underdeveloped and developing nations is expected to boost the demand for railroads during the forecast period.

Governments of various countries across the globe are investing for expansion of their railroads in the recent years owing to rising demand for rail freight. For instance, in September 2017, the Israel Ministry of Economy approved the purchase of 60 four-car and six-car EMUs worth USD 910 million from Siemens. In addition, in the same month, the Indian Railway minister has directed to fast track thefreight corridor projects between Delhi-Mumbai and Delhi-Howrah. Such initiatives and investments are expected to bolster the market growth during the forecast period.

Many travelers coming from other countries depend on railways to travel the local destinations in Asia Pacific and European countries owing to their cheap fares. In the recent years, the tourism industry is flourishing owing to increasing disposable income and improving economic conditions in the emerging nations. Tourism also has become a key contributor for GDP in some countries like Myanmar. This increasing tourism is expected to boost the demand for passenger rails segment during the forecast period.

Type Insights

The passenger rail segment held the largest share in the market in 2016 and is anticipated to witness the fastest growth rate during the forecast period. Growing tourism industry and low fares of passenger trains are expected to be the key factors for the growth of passenger rail segment in the coming years. In addition, increasing investments for expanding the passenger rail network is expected to boost the market growth in the coming years.

In the recent years, there has been an increasing interest of passengers to travel by bullet and metro trains for every day commute. This has resulted in increasing investments to build new lines and to increase the number of trains operating. For instance, in June 2016, the Roads and Transport Authority (Dubai) awarded a contract to French, Spanish and Turkish firms for the extension of Dubai Metro’s Red Line from Nakheel Harbour and Tower Station to the Expo 2020 site. The project is estimated to cost around USD 2.89 billion (Dh 10.6 billion) and is likely to add 50 new trains in the route. In addition, investments are also being made to enhance the safety and to buy advanced cars for the train. This increasing demand for cars lead to the development of technologically advanced products.

The rail freight segment is expected to witness a growth rate of 5.4% during the forecast period owing to increasing dependency on rail route for the transport of goods and cheaper rates of transport through this mode. In addition, high connectivity of rail network aids in transporting goods to the remote locations which are otherwise difficult to reach by air. Availability of lesser substitutes for transport of heavy goods is expected to boost the demand for rail freight in the coming years.

Regional Insights

U.S. dominated the market in 2016 with the highest market share. The country has one of the largest rail networks in the world. The U.S. railroads has more than 28,000 locomotives and 1.5 million railcars. According to the Association of American Railroads, freight rail is a pillar of U.S. economy. The growth of railroads markert in the U.S. can be attributed to increasing measures for the safety of passengers, rising demand for consumer goods, and technological advancements in the industry.

Europe is expected to command the second largest share after U.S. in the global railroads market. Increasing dependency on railways for transport and booming tourism industry can be the key factors for the growth of European railroads market in the coming years. In addition, there has an increase in infrastructure expenditure in the recent years. The infrastructural expenditure on rails has increased from USD 34.71 billion (EUR 29 billion) in 2009 to USD 53.85 billion (EUR 45 billion) in 2014. Such increasing spending for providing better services is expected to further boost the market growth in the coming years.

The Asia Pacific market is anticipated to grow at the highest rate of 6.8% over the forecast period owing to increasing spending by the governments on construction of new railroads and dependency of population on rail for transportation. In addition, growth in the imports and exports of Asian countries expected to bolster the market growth. According to unife, the number of freight cars in Asia Pacific region has increased by 28,000 units between 2013 and 2015. Construction of dedicated freight corridors in India and increasing usage of speed trains in China & Japan can be the other factors which are expected to boost the Asia Pacific railroads market in the coming years.

Railroads Market Share Insights

Some of the key market players include Central Japan Railway Company, OAO RZD (Russian Railways), Union Pacific Corporation, Burlington Northern Santa Fe (BNSF), Canadian National (U.S.), Norfolk Southern, CSX Transportation, Canadian Pacific (U.S.), and SNCF Group.

Report Scope

Segments Covered in the Report

This report forecasts revenue growth and provides an analysis on the industry trends in each of the sub segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the railroads market on the basis of type and region:

• Type Outlook (Revenue, USD Billion; 2014 - 2025)

  • Passenger Rail

  • Frieght Rail

• Regional Outlook (Revenue, USD Billion; 2014 - 2025)

  • U.S.

  • Europe

  • Asia Pacific

  • Middle East

  • Rest of the World