Railway Telematics Market Size, Share & Trends Analysis Report By Solution (Fleet Management, Automatic Stock Control, Remote Data Access, Railcar Tracking & Tracing), By Railcar, By Component Type, And Segment Forecasts, 2021 - 2028

Report Overview

The global railway telematics market size was valued at USD 10.61 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 7.5% from 2021 to 2028. The surge in demand for a safe, secure, and efficient transport system is anticipated to support market growth. Advanced transport systems are less likely to witness fatalities owing to upgraded telematics technologies, thereby contributing to the growth. However, COVID-19 pandemic-related lockdowns hampered transportation and freight activities globally during the first half of 2020, negatively impacting the market growth. The growing demand for the digitalization of railcar tracking and increasing rail freight transportation are some of the key factors anticipated to drive the growth.

Advanced technologies such as asset management, integrated service management, shock detection, predictive analytics, and automatic stock control can help rail management operators manage optimal routes, idle railcars capacities, and schedules in near real-time. The increasing adoption of these as well as other smart technologies, such as railway telematic, freight tracking, smart ticketing, platform signaling, is also expected to drive the demand for associated services and solutions.

Railway telematics systems are primarily implemented by rail corporations, rail management companies, and insurance companies to monitor the location and behavior of railcars. Telematics solutions track the movement and location of a vehicle by combining on-board diagnostics systems and Global Positioning Systems (GPS). Together, diagnostics systems and GPS can record the railcars' location, speed, and internal behavior. Furthermore, telematics solutions provide data related to the security and safety of the vehicle.

Increased budget allocation for the development of railways and the rising demand for safer, secure, and efficient transport systems are working favorably for the market. The promising pace of urbanization globally is paving the way for smart cities. Government authorities globally are investing in various smart city projects to improve transportation infrastructure, further driving infrastructure development activities in the public transportation sector.

The market suffered a significant blow due to the spread of the COVID-19 virus in the first half of 2020. Lockdown restrictions imposed by various governments globally temporarily halted logistics and freight activities. Moreover, trade restrictions across the globe hampered market growth. However, the demand for railway telematics solutions is anticipated to recover in the near future.

Solution Insights

Based on solution, the market is categorized into fleet management, automatic stock control, remote data access, railway tracking and tracing, and others. The fleet management segment dominated the market in 2020 and accounted for more than 32.0% of the revenue share. The rapid increase in the demand for telematics solutions in industries such as BFSI and healthcare is anticipated to fuel the segment's growth.

The railcar tracking and tracing segment is anticipated to expand at the highest CAGR of 8.2% over the forecast period. The growth can be attributed to the surge in demand for predictive maintenance of freight wagons to identify operational issues. Railcar operators need to observe the progress of transport using different intermodal systems that comply with maintenance and safety regulations and ensure that wagons are reliable and can meet personnel costs. To make processes more economical, industries such as healthcare and logistics adopt railcar tracking and tracing solutions, thereby favoring the growth prospects of the segment.

Component Type Insights

Based on component type, the market is segmented into telematics control units and sensors. The telematics control unit segment accounted for 56.48% of the overall market in 2020. A telematics control unit offers solutions for two-way control and tracking of railcars. It also provides integrated and complete fleet monitoring solutions for logistics and transportation, allowing the real-time control and visibility of transport assets as they move through the supply chain. The introduction of advanced TCUs in railcars is allowing for increased profitability, safety, and maintenance.

The sensors segment is anticipated to grow at a CAGR of 8.6% over the forecast period. The growth can be attributed to the notable rise in government initiatives and investment in the development of smart railway infrastructure. Sensors assist in data gathering and monitoring, signaling, and rail tracking and tracing.

Railcar Insights

Based on railcar, the market is categorized into hoppers, tank cars, well cars, boxcars, refrigerated boxcars, and others. The hoppers segment dominated the market in 2020 and accounted for more than 23.3% revenue share. The segment is anticipated to gain significant traction and retain dominance over the forecast period. Hopper railcars help in freight activities and transportation of bulk commodities, including grain, coal, and ore. The growing demand for transporting and tracking consignments across various logistics and freight transportation organizations is expected to drive the demand for hopper railcars. 

The refrigerated boxcars segment is projected to expand at the highest CAGR of 8.4% from 2021 to 2028. The increasing demand for refrigerated boxcars in various verticals, including healthcare, chemicals, and food and beverage, to transport goods is contributing to the growth of the segment. Refrigerated boxcars are designed and developed to carry perishable products at a specific temperature.

Regional Insights

Europe dominated the market in 2020 and accounted for over 36.0% share of the global revenue. The region is home to prominent players such as Siemens AG, Knorr-Bremse AG, and Alstom SA. These players focus majorly on partnering and collaborations with rail corporations in various countries. For instance, In November 2019, Mumbai Metro Rail Corporation and Alstom revealed the life-size mock-up of the trainset for Mumbai Metro Line Number 3.

The railway telematics market in the Asia Pacific region is anticipated to expand at the highest CAGR of 9.4% from 2021 to 2028. The growth can be attributed to the increasing GDPs of countries, rising penetration of advanced technologies, steady growth, and the presence of several emerging economies in the region. Furthermore, increasing awareness about accident prevention and driver safety, the promising expansion of the logistics and freight transportation industries, and the entry of several leading OEMs in the region are expected to favor the market for railway telematics in the region.

Key Companies & Market Share Insights

Prominent players in the market in 2020 include Hitachi Ltd., Wabtec, Siemens AG, Robert Bosch GmbH, Knorr-Bremse AG, and Alstom SA. These players focus on acquisitions, partnerships, and collaborations to enhance their presence in the market and gain a competitive edge. For instance, in February 2021, Trinity Rail Group launched Trinsight, a digital platform for offering real-time intelligence regarding location and the status and condition of rail equipment. The platform is designed to enhance the management, efficiency, and safety of fleet operations.

Market players also focus on initiatives such as new product launches and joint ventures, to enhance their position in the market. For instance, in March 2021, Siemens AG announced the complete digitalization of Finnentrop interlocking in North-Rhine Westphalia state. The company stated that 404 interlocking units are estimated to be substituted, which comprise switch points, signals, and derailers. Some of the prominent players in the global railway telematics market are:

• Siemens AG

• Hitachi Ltd.

• Alstom SA

• Knorr-Bremse AG

• Robert Bosch GmbH

Railway Telematics Market Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2028 For this study, Grand View Research has segmented the global railway telematics market report based on solution, railcar, component, and region:

• Solution Outlook (Revenue, USD Million, 2018 - 2028)

  • Fleet Management

  • Automatic Stock Control

  • Remote Data Access

  • Railcar Tracking and Tracing

  • Others

• Railcar Outlook (Revenue, USD Million, 2018 - 2028)

  • Hoppers

  • Tank Cars

  • Well Cars

  • Boxcars

  • Refrigerated Boxcars

  • Others

• Component Type Outlook (Revenue, USD Million, 2018 - 2028)

  • Telematics Control Unit

  • Sensors

• Regional Outlook (Revenue, USD Million, 2018 - 2028)

  • North America

    • U.S.

    • Canada

  • Europe

    • U.K.

    • Germany

    • France

  • Asia Pacific

    • China

    • Japan

    • India

  • Latin America

    • Brazil

    • Mexico

  • Middle East & Africa