ID: MRFR/ICT/1992-CR | February 2020 | Region: Global | 148 pages
Global Smart Railway Market is estimated to reach exponential valuation by 2024, growing at a 16.5% CAGR during the forecast period - 2019 to 2024.
The world is becoming increasingly digitized, and the railway industry would not be immune to this change. Even the railway sector, which is considered a conservative industry with respect to technology adoption, has acknowledged the benefits of going digital. As the railway industry begins to embrace digital technologies, connectivity, cloud, and artificial intelligence (AI) have emerged as three key areas building blocks of the industry's transformation.
Digitalization in the railway industry ensures operational efficiency, sustainability, improved customer experience, and customer satisfaction, which used to be paramount concerns railway operators worldwide were facing until recently. Urbanization, increasing mobility, and higher safety & sustainability standards have led to a more demanding playing field.
COVID 19 hit the overall railway industry, forcing the industry to reduce their production plants' output. The disruption caused by the pandemic prompted various key component suppliers and technology providers to cut back expenses and production in some areas. Resultantly, industry players intensively started working on countermeasures and alternatives to minimize the impact. Emerging economic and technical trends presented new challenges to ICT construction in the urban rail sector.
However, the smart railway market is returning to normal, and subsequently, revenues are too picking up gradually. To maximize the core advantages of urban rail transportation, growing numbers of countries are implementing smart railways, establishing ICT-enabled applications to provide more convenient passenger transport services. Now, there are higher and more diversified requirements on urban rail operational management.
Train-to-ground wireless communications networks are improving, too, offering more reliable, secure, and larger transmission bandwidth. Advances in IP-based and broadband networks and the rapid growth of IP services such as CCTV and multimedia advertising have improved bandwidth utilization, constructing highly reliable network construction.
Drivers & Opportunities
Rising Adoption of advanced safety Systems Drives the Market Growth
Smart railways offer advanced and reliable services that enhance operational efficiency, passenger experience, and high returns on investments (ROI). Increasing demand for efficient and safer commuting services creates substantial smart railway market demand. Besides, the increasing adoption of IoT technology and the growing demand for cloud-based services foster the smart railway market growth.
Technological advances in the fields across the network, radio access, sensors, and other systems, along with the proliferation of the Internet of Things and IoT devices, boost the smart railway market size. Furthermore, advances in radio-based communication networks such as Bluetooth, Wi-Fi, and 3G & 4G services improve the efficiencies in smart railways projects.
Restraints & Challenges
Lack of ICT Infrastructure is a Major Market Restraint
The lack of information & communication technology infrastructure is a major factor projected to hamper the expansion of the smart railway market. The ICT technology combines hardware and software products that ensure the intelligent use of all rail assets. Also, high installation costs and concerns related to infrastructure changes of the existing system pose significant challenges to the smart railway market growth.
The market is segmented on the basis of type, component, solution, services, and region. The type segment is further bifurcated into the station and onboard type. The component segment is sub-segmented into multimedia infotainment displays, networking & connectivity devices, video surveillance cameras, and others.
The solution segment is sub-segmented into passenger information systems, advanced security monitoring systems, rail communication & networking systems, rail analytics systems, freight information systems, and smart ticketing systems. The services segment is sub-segmented into consulting services, system integration & deployment, and support & maintenance.
By region, the market is bifurcated into the Americas (US, Canada, Mexico, Rest-of-North America) and South America, Europe (the UK, Germany, Italy, France, and Rest-of-Europe), Asia Pacific (Japan, India, China, South Korea, and Rest-of-the-APAC), and Rest-of-the-World.
Europe Dominates the Global Smart Railway Market
Globally, Europe holds the largest share in the smart railway market. The region is the global hub for high-end train manufacturers and a promising market for luxury autonomous trains. In 2017, the smart railway market in Europe accounted for a 54.5% market share, with a market value of USD 6,301.7 million, which is estimated to grow further at a 15.8% CAGR during the forecast period.
Factors such as the adoption of IoT technology, fast economic growth, and significant investments in smart railways projects by the government drive the growth of the regional market. Recently, European Union assigned USD 6.6 million funding for the Horizon 2020 research and innovation program for smart railways. Such government initiatives boost the smart railway market size.
North America Derives Second-Largest Market Share
North America is the second-largest market for smart railways. In 2017, the region accounted for a market valuation of USD 2,776.6 million, which is expected to grow further at a 16.7% CAGR during the assessment period. The smart railways market in North America is experiencing a huge demand due to the increasing penetration of advanced technologies. Furthermore, the increasing mobility and innovations, and technology upgrades with respect to railway infrastructure are fostering the growth of the smart railways market.
APAC is Emerging Market for Smart Railways
The Asia Pacific region is a rapidly emerging market for smart railways. The increase in R&D investments for the development of autonomous trains boosts the growth of the regional market. Besides, rising consumer preference and government spending to implement high-performance trains positively impact the regional market growth.
Moreover, increasing smart city projects, including smart railways and smart hospitals, influence market growth. The Asia Pacific smart railway market is expected to grow at a 19.7% CAGR during the assessment period.
Highly competitive, the smart railway market appears fragmented with the presence of many key industry players. Players initiate strategic moves such as collaboration, mergers & acquisitions, innovation, and brand reinforcement to gain a larger competitive share.
List of Key Companies
Top companies operating in the global smart railway market include 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), among others.
Alstom SA is a French multinational rolling stock manufacturer operating in rail transport markets worldwide. The company is active in the fields of passenger transportation, signaling, and locomotives, with products. Alstom also develops and markets integrated systems that provide the sustainable foundations for the future of transportation, leading the way to greener and smarter mobility worldwide. Alstom offers a complete range of equipment and services, from high-speed trains, metros, trams, and e-buses to integrated systems, customized services, infrastructure, signaling, and digital mobility solutions.
Jan. 26, 2021 – Alstom SA announced the acquisition of B&C Transit, Inc., a transit engineering design and construction company specializing in the passenger rail sector. This transaction reinforces Alstom's position in the North American signaling market to benefit transit agencies and operators across the United States and Canada.
Jan. 21, 2021 – Alstom SA announced signing a Memorandum of Understanding (MoU) with Serbia's Government for the construction of the future Belgrade metro. As per the MoU, Alstom would be responsible for a wide scope of works, including the metro trains themselves, digital train control systems, platform screen doors, the infrastructure, and the transport system integration.
Jan. 20, 2021 – Alstom SA announced winning a contract worth €106 million from the National Capital Region Transport Corporation Ltd. (NCRTC) India to design, supply, and install the signaling, train control, and telecommunication system. NCRTC is a joint venture (JV) between the Government of India and the States of Haryana, Delhi, Rajasthan, and Uttar Pradesh, implementing RRTS, a first-of-its-kind semi-high-speed rail line.
The smart railway software market analysis features unique and relevant factors expected to significantly impact the market growth during the forecast period. The detailed and considerable amount of smart railway software market study would help industry players better understand the market. The MRFR report elaborates on the historical and current smart railway software market trends, boosting the growth of the market. The analysis of COVID-19 impact on smart railway software market revenue is also included in the report.
This report examines the pricing structure, profit margins, and production influencing the smart railway software market share. Regional assessment explained in this smart railway software market forecast unlocks many untapped opportunities in regional and domestic market places. Detailed company profiling enables users to evaluate company shares analysis, the scope of the existing & emerging product in new markets, pricing strategies, innovation possibilities, and much more.
Frequently Asked Questions (FAQ) :
A 16.5% CAGR is estimated to set the development pace of the market favorably.
The forecast period covers the years from 2020 to 2027.
The integration of new-generation solutions and services for rail transportation and operations is expected to spur the overall market growth.
The European region is projected to develop as the largest region due to the presence of a well-developed railway network in the region.
A 15.8% CAGR growth is expected to be gained by the region in the course of the forecast period.
Cisco Systems, Inc. (US), Huawei Technologies Co. Ltd (China), General Electric Inc. (US), Hitachi Limited (Japan), Alstom SA (France), and International Business Machines Corporation (US) are the competitors investing in the market.
A CAGR of 19.7% is expected to strengthen the position of the APC region as the fastest-growing region in the market.