ID: MRFR/ICT/1992-CR | 148 Pages | Published By Ankit Gupta on February 2020
Smart Railway Market Size was valued at USD 21.3 billion in 2021. The Smart Railway market industry is projected to grow from USD 23.3 billion in 2022 to USD 43.9 billion by 2030, exhibiting a compound annual growth rate (CAGR) of 9.45% during the forecast period (2022 - 2030). The smart railway market drivers includes factors such growing urbanization coupled with local commuting requirements, surge in demand for passenger & freight capacity, increase in the number of railway projects globally, and changes in passenger payment patterns.
Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review
Growing demand for intelligent freight trains for international trade to propel market growth
With an increase in worldwide trade, railroad logistics transportation is growing. The United Nations Conference on Commerce and Development (UNCTAD) estimates that the value of world trade increased by 25% to USD 28.5 trillion. In order to provide real-time monitoring of railway systems and logistical activities, railway operators are implementing smart railway components such as Communication-Based Train Control (CBTC) systems, high-speed sensors, and intelligent computing equipment. The main mode of transportation for logistics from sea to land is the freight railroad. Cross-border logistics activities demand real-time data communication. Access to the onboard logistics tracking nodes between the local device and the cloud device is now possible thanks to the deployment of 4G LTE or 5G Technology. The International Energy Agency (IEA) estimates that 7% of all freight is transported via rail networks. Additionally, major participants in the world's railway business are modernizing smart, sustainable electric locomotives. In order to reduce project costs overall, several governments are awarding Build-Operate-Transfer (BOT) contracts, and it is anticipated that these factors will fuel demand over the forecast period. Thus, this factor is driving the market CAGR.
The use of data and IoT in the railway industry has gone beyond accounting, shipping and logistics management, and resource management to include regular train operations. These tasks include scheduling, securely operating trains, figuring out the financial advantages, and others. Along with the use of technology by train operators, IT solution providers have improved their portfolio for interested parties. In-demand business processes that call for an efficient IT solution include virtualization, customized asset management software, and analytical and predictive modeling. In the upcoming years, as railroads transition to partially autonomous transportation, there will be a greater need for intelligent railway systems. To provide a seamless and secure commute, railway firms are exploring smart railway systems. Rail operators use analytical tools to foresee potential breakdowns and, as a result, fix the issue in advance, improving and ensuring the safety of passengers while also increasing the operator's overall efficiency. Asset management is a key area where smart railway technologies are applied and embraced. In order to anticipate demand surges, forecast demand, increase capacity, and manage resources, railways use integrated modules of predictive and analytical technologies.
Various national governments and commercial railway administrations aggressively push and embrace new green technologies, such as solar-powered train headlights. Developing environmental protection standards and evaluation procedures for railways has become essential as the discussion about energy conservation intensifies. Smart trains are anticipated to be crucial in lowering the amount of coal and electricity needed to run this enormous piece of equipment. Energy efficiency has been cited as a key factor in railway adoption because it lowers expenses. As a result, stakeholders in the railway sector are taking a number of actions to minimize noise pollution whenever possible. As a result, stakeholders in the railway sector are taking a number of actions to lessen noise pollution whenever it is practical. For instance, solution providers sell vibration-generated alerts that may be connected to the infrastructure of an existing train to notify commuters of its arrival. The integration of such ecological solutions into a unified system, which aids in addressing environmental concerns, is what is driving the development of smart trains.
Urbanization has reached its apex in recent years as the majority of the population moves into cities due to an increase in employment opportunities and rapid industrialization. Every person needs a simple daily commute between their place of employment and home in this age of urbanization. Urban commuters are also more likely to take the rail because it offers a time-effective alternative to avoiding pointless traffic congestion. Thus, an increase in urban commuters' dependability on trains for their daily commute has a considerable positive impact on the market for smart railways. Thus, it is anticipated that this aspect will accelerate Smart Railway market revenue globally.
The Smart Railway market segmentation has been segmented by type into Station Type and Onboard Trains. The onboard trains segment dominated the market growth in 2021 and is projected to be the faster-growing segment during the forecast period, 2022-2030. In the future years, the segment's growth will be accelerated by the strong expansion of the strategic alliance between rail operators and providers of smart solutions services like onboard trains, as well as by the ongoing technical advancements in railway infrastructure throughout growing nations.
Figure 2: Smart Railway Market by Type, 2021 & 2030 (USD Billion)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
The Smart Railway market segmentation has been segmented by component into Networking & Connectivity Devices. The networking & connectivity devices segment dominated the market in 2021 and is projected to be the faster-growing segment during the forecast period, 2022-2030. The use of intelligent communication solutions in a variety of railway management applications enables quick decision-making on matters such as asset deployment, maintenance, and utilization. To provide safety, security, and continuous services like networking & connectivity devices, efficient railroad operations depend on accurate, timely communication among stations, control, dispatch centers, and rolling stock.
The Smart Railway market data has been segmented by services into Consulting Services and System Integration. The consulting services segment dominated the market in 2021 and is projected to be the faster-growing segment during the forecast period, 2022-2030. The growing need for outsourcing smart railway maintenance is one factor that is anticipated to fuel the market's demand for consultancy services. One of the key reasons anticipated to drive the growth of the market for smart railroads is the necessity for organisations to optimize resource usage.
The Smart Railway market data has been segmented by solution into Smart Ticketing System and Passenger Information System. The smart ticketing system segment dominated the market in 2021 and is projected to be the faster-growing segment during the forecast period, 2022-2030. With the help of the cutting-edge ticketing system known as smart ticketing, consumers can easily pay for smart railway travel. Customers can use contactless payment by swiping their credit or debit card or scanning from their cellphones. Additionally, a biometric system is widely used on smart trains, which is significantly boosting the segment's revenue development.
Smart Railway Regional Insights
By region, the study provides the market insights into North America, Europe, Asia-Pacific, and the Rest of the World. Europe Smart Railway market accounted for USD 8.4 billion in 2021 and is expected to exhibit a 42.60% CAGR during the study period. The region's market revenue growth is being driven by the quick development of technology and passenger transportation. A number of European nations are heavily investing in and modernizing their current train networks to create smart railways. One such agreement for the installation of a smart onboard signalling system in Sweden was signed by Hitachi Railway Limited.
Further, the major countries studied in the market report are: The U.S., Canada, Germany, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.
Figure 3: SMART RAILWAY MARKET SHARE BY REGION 2021 (%)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Asia Pacific Smart Railway market accounts for the fastest growing market share. In this area, the market revenue is growing as a result of the expanding population and accelerating infrastructure construction. 60% of the world's population, according to The United Nations (UN), resides in Asia and the Pacific. Electronic sensor and Internet of Things (IOT) product manufacture is centred in the Asia Pacific region. As a result, traditional railways are transformed into smart railways on a broad scale. Further, the China Smart Railway market held the largest market share, and the India Smart Railway market was the fastest-growing market in the region.
North America Smart Railway market is expected to grow at a substantial CAGR from 2022 to 2030. Growth in this sector is being fueled by developments in edge computing, deep learning, and artificial intelligence (AI). Major American cities are updating smart technology like automated signalling systems, smart ticketing systems, and rail analytics systems. Moreover, US Smart Railway market held the largest market share, and the Canada Smart Railway market was the fastest-growing market in this region
Major market players are spending a lot on R&D to increase their product lines, which will help the Smart Railway industry grow even more. Market participants are also taking various strategic initiatives to grow their worldwide footprint, including new product launches, contractual agreements, mergers and acquisitions, increased investments, market developments and collaboration with other organizations. Competitors in the industry must offer cost-effective items to expand and survive in an increasingly competitive and rising market industry.
One of the primary business strategies manufacturers adopt in the Smart Railway industry to benefit clients and expand the sector is manufacturing locally to reduce operating costs. In recent years, Smart Railway industry has provided medicine with some of the most significant benefits. The Smart Railway market major player such as Cisco Systems Inc. (US), Alstom SA (France), General Electric Inc. (US), Hitachi Limited (Japan), International Business Machines Corporation (US), Huawei Technologies Co. Ltd (China), Bombardier Inc. (Canada), Siemens AG (Germany), Indra Sistemas SA (Spain), Thales Group (France) and Teleste (Finland).
Located in Chiyoda, Tokyo, Japan, Hitachi, Ltd. is a multinational conglomerate corporation. It served as a component of the Nissan Zaibatsu, the DKB Group, and the Fuyo Group of companies before DKB and Fuji Bank merged to form the Mizuho Financial Group. It is the parent company of the Hitachi Group. In July 2022, European Rail Traffic Management System (ERTMS) signalling will be implemented throughout the region thanks to a partnership between Swedish railroad company TGAB and Japan-based fully integrated rail solutions provider Hitachi Rail Limited. Based on ERTMS and STM-ATC2 technologies, Hitachi Rail Limited will design, construct, instal, test, certify, and commission the onboard signalling system. Trains will be able to run on regular lines thanks to STM-ATC2.
Alstom is a French multinational company that manufactures rail transportation equipment and does business all over the world. It manufactures high-speed, suburban, regional, and urban trains along with trams, and it is active in the passenger transportation, signalling, and locomotive industries. In January 2021, B&C Transit, Inc., a transit engineering design and construction firm focusing in the passenger rail industry, was acquired by Alstom SA, according to a press release. Transit agencies and operators across the United States and Canada will benefit from Alstom's strengthened position in the North American signalling market as a result of this deal.
Cisco Systems Inc. (US)
Alstom SA (France)
Hitachi Limited (Japan)
International Business Machines Corporation (US)
Huawei Technologies Co. Ltd (China)
Bombardier Inc. (Canada)
Siemens AG (Germany)
Indra Sistemas SA (Spain)
Thales Group (France)
June 2021: By updating the locomotives in the entire CSX fleet and applying cutting-edge digital technologies, Wabtec and CSX worked together to speed up sustainable rail and achieve significant fuel efficiency and pollution savings for CSX's rail operations. By working together, CSX will be able to fulfil its pledge to lower greenhouse gas emissions intensity by 37% by 2030.
January 2021: In order to build the future Belgrade metro, Alstom SA and the Serbian government signed a Memorandum of Understanding (MoU). According to the MoU, Alstom would be in charge of a variety of projects, including the infrastructure, integration of the transportation system, platform screen doors, digital train control systems, and metro trains themselves.
Networking & Connectivity Devices
Smart Ticketing System
Passenger Information System
Rest of Europe
Rest of Asia-Pacific
Rest of the World
|Market Size 2021||USD 21.3 Billion|
|Market Size 2022||USD 23.3 Billion|
|Market Size 2030||USD 43.9 Billion|
|Compound Annual Growth Rate (CAGR)||9.45% (2022-2030)|
|Historical Data||2018 & 2020|
|Forecast Units||Value (USD Billion)|
|Report Coverage||Revenue Forecast, Competitive Landscape, Growth Factors, and Trends|
|Segments Covered||Type, Component, Services, Solution and Region|
|Geographies Covered||North America, Europe, Asia Pacific, and Rest of the World|
|Countries Covered||The U.S, Canada, Germany, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil|
|Key Companies Profiled||Cisco Systems Inc. (US), Alstom SA (France), General Electric Inc. (US), Hitachi Limited (Japan), International Business Machines Corporation (US), Huawei Technologies Co. Ltd (China)|
|Key Market Opportunities||Rising Adoption of advanced safety Systems Drives the Market Growth|
|Key Market Dynamics||Smart railways offer advanced and reliable services that enhance operational efficiency, passenger experience, and high returns on investments (ROI).|
The market size was expected to be USD 21.3 billion in 2021.
The market is expected to register a CAGR of ~9.45% over the next ten years.
Europe held the largest market share in the market.
Cisco Systems Inc. (US), Alstom SA (France), General Electric Inc. (US), Hitachi Limited (Japan), International Business Machines Corporation (US), Huawei Technologies Co. Ltd (China) are the key players in the market.
The onboard trains category led the segment in the market.
The smart ticketing system category had the largest market share in the market.