World Rail Market Study - Roland Berger

UNIFE Worldwide
Rail Market Study 2012
Press conference at Innotrans
Berlin, September 18, 2012
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Roland Berger and Unife conducted the fourth edition of the World
Rail Market Study
Update of WRMS
CHARACTERISTICS AND DEVELOPMENT
Leading companies from the European rail
industry provide market data and expertise
Update every two years since 2006
Methodology and most assumptions unchanged
Special topic of this study: Mechanisms in the
rail supply industry and its sensitivity to business
cycles and public spending
Study can be purchased in parts for specific
market segments for the first time
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The market was analyzed in four dimensions: transport and
product segments, regions and accessibility of the market
Scope and segmentation (key elements)
Transport segments Product segments
> Very High-Speed
> Mainline
> Freight
> Light Rail
> Metro
> Seven major regions, e.g.
Western Europe, CIS
> 55 countries considered in detail,
others extrapolated
PIC
> Four major segments: Rail control,
Infrastructure, Rolling stock,
Services
> Split in sub-segments, e.g. Rolling
stock split in 13 types (High speed,
EMU Accessibility factor accounts for
incomplete liberalization and
dominance of incumbent
> Figures are presented as total
market and accessible market
Regional segments Market accessibility
COUNTRIES
TRANSPORT
SEGMENTS
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Current market increased by more than 3% CAGR 1) over the last
study – Biggest absolute growth in infrastructure and rolling stock
Comparison of worldwide total market volume UNIFE 2009 vs. 2011 1) [EUR bn]
MARKET VOLUME p.a. COMPOSITION of DELTA
137
TOTAL
2007-09
CAGR: 3.2%
146
TOTAL
2009-11
1) CAGR: Compound annual growth rates
+9
CAGR
2009-11 vs.
2007-09 [%]
+5.6% +3.1% +1.3% +6.8% +8.7% +3.2%
3.1
Infrastructure
2.8
Rolling
stock
1.4
Services
1.5
Rail control
0.1
Integrated
projects
9
TOTAL
DELTA
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Passenger transport suffered little in the economic crisis 2008/09
and has recovered well – example Europe
Special topic: GDP and passenger rail transportation
12,000
11,500
11,000
10,500
10,000
9,500
9,000
8,500
8,000
7,500
9,762
450
9,892
452
10,272
455
10,482
455
10,842
459
+1.5%
+1.3%
11,188
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
459
GDP Europe, left axis [EUR bn] Passenger transported, right axis [bn pkm]
-4.2%
11,212
10,736
10,948
11,119
494
-0.5%
CAGR%
492
496
504
1,000
900
800
700
600
500
400
300
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Rail freight has recovered substantially from economic crisis
2008/09 but not reached pre-crisis levels
Special topic: GDP and rail freight transportation (U.S.)
14,000
13,000
12,000
11,000
10,000
9,000
8,000
11,543
2,376
2002
11,836
2,376
2003
GDP United States [USD 1,000 bn]
12,247
2,454
2004
12,623
2,531
2005
12,958
2,686
2006
+0.4%
+1.6%
13,206
2,661
2007
Goods transported, right axis [bn tkm]
-1.9%
13,162
12,703
2,665
-7.0%
2008
2,299
2009
CAGR%
13,088
2,356
2010
13,313
2,454
2011
3,000
2,800
2,600
2,400
2,200
2,000
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Major trends continue to drive the growth of the industry
Relevant major trends
ERTMS train protection
technology
Indicates impact on the industry
Urbanization and
increased mobility
Energy scarcity and
environmental concern
Overall economic
growth
Increased government
support
Deregulation and
liberalization
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Rail supply markets are forecast to grow at 2.7% in the next six
years – highest growth in Africa & Middle East and Latin America
Accessible market volume by region [EUR bn p.a.]
105.9
21.5
+2.7%
+2.9%
NAFTA
124.1
World market
25.5
3.9
+7.5%
Rest of
Americas
6.1
32.2
+1.9%
Western
Europe
Market volume 2009-11 per year Market volume 2015-17 per year
36.1
4.1
6.9
+10.0%
+3.2%
Eastern
Europe
7.4
Africa &
Middle East
x%
8.4
11.0
+4.5%
CIS
14.4
+0.2%
26.1 26.3
Asia &
Pacific
Compounded annual growth rate 2015-2017 vs. 2009-2011 –
average of a +/- 0.5 percentage point range
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Services and rail control markets expected to show strong growth,
infrastructure and rolling stock growing at slightly slower pace
Key developments per product segment
Infrastructure Rolling stock Rail control Services
> Showing steady growth
rates driven by large
investment projects in
Africa and Middle East
as well as in Latin
America
> Overcompensation of
notable decreases in
the Chinese VHS
segment through
investments in urban
rolling stock, especially
in metro
1) Compounded annual growth rate of accessible market 2015-2017 vs. 2009-2011
CAGR growth rates 1)
> Showing high growth
rates driven by the rollout
of ERTMS and
PTC in the train
protection segment
towards the middle of
the decade
> High growth rates driven
by a continuously
increasing installed
base and gradually
increasing accessibility
of several countries
2.0%-2.5% 2.0%-2.5%
3.0%-3.5%
2.5%-3.0%
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The Western European market shows steady growth driven by the
rolling stock and the services segments
Market development in Western Europe
CURRENT ACCESSIBLE MARKET
Market volume p.a. [EUR bn]
32
5
8
9
11
2009-2011
Rail control Infrastructure Services
1) Compounded annual growth rate 2015-2017 vs. 2009-2011
CAGR [%] 1)
1.5% to 2.0%
1.5% to 2.0%
-0.5% to 0.0%
2.5% to 3.0%
2.5% to 3.0%
Rolling stock
KEY DEVELOPMENTS
Rolling stock main growth driver, with UK and
France investing heavily
Infrastructure showing lowest growth rates,
also carried by nationwide investments in the
UK and France
Projects include VHS lines in France (e.g.
bypass Nimes – Montpellier) and capacity
improvements around London (e.g.
transversals projects)
ERTMS progressing slower than anticipated,
but roll-out expected later this decade
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The Asia & Pacific markets stagnate after large VHS investments in
China have been done in the past
Market development in Asia & Pacific
CURRENT ACCESSIBLE MARKET
Market volume p.a. [EUR bn]
26
2
5
5
14
2009-2011
Rail control Infrastructure Services Rolling stock
1) Compounded annual growth rate 2015-2017 vs. 2009-2011
CAGR [%] 1)
0.0% to 0.5%
3.0% to 3.5%
3.0% to 3.5%
2.0% to 2.5%
-2.5% to -2.0%
KEY DEVELOPMENTS
Large Chinese VHS demands fulfilled up until
2009 and thus not maintained in subsequent
periods – recovery in the long term
Alongside China, India investing heavily with
plans of building a metro or a monorail system
in cities > 3 million inhabitants (e.g. Bhopal,
Jaipur, Kanpur, Lucknow, Pune, etc.)
Infrastructure growth expected, carried by
projects in India, Indonesia, South Korea,
Taiwan and Thailand
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The accessible market in CIS will show an annual growth of up to
5% per driven especially by rail control and services
Market development in CIS
CURRENT ACCESSIBLE MARKET
Market volume p.a. [EUR bn]
Rail control
1.0
11.0
3.2
6.1
0.6
2009-2011
Infrastructure
Services
1) Compounded annual growth rate 2015-2017 vs. 2009-2011
CAGR [%] 1)
4.5% to 5.0%
7.0% to 7.5%
-0.5% to 0.0%
6.5% to 7.0%
4.0% to 4.5%
Rolling stock
KEY DEVELOPMENTS
Russia to invest significantly in electric locomotives
and trams/light rail (replacement and
extensions in various cities) in medium to long
run
Accessible market for infrastructure almost
stable at about EUR 1bn with decreases in
Kazakhstan and particularly Ukraine mostly
compensated by increases in Russia
Services showing a high growth rate because of
growing installed base in last years and increased
accessibility (spin-off of maintenance from
RZD)
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Africa & Middle East is expected to become a major growth driver
for the rail industry in the upcoming years
Market development Africa & Middle East
CURRENT ACCESSIBLE MARKET
Market volume p.a. [EUR bn]
4.1
0.4
0.7
1.0
2.0
2009-2011
Services Rail control Infrastructure Rolling stock
1) Compounded annual growth rate 2015-2017 vs. 2009-2011
CAGR [%] 1)
10.0% to 10.5%
2.0% to 2.5%
9.5% to 10.0%
18.0% to 18.5%
6.5% to 7.0%
KEY DEVELOPMENTS
Region driven by high growth rates in the GCC
countries
Very high expected growth rates even after accounting
for delays/cancellations of projects
Projects include Doha and Dubai metro systems,
the Saudi Land Bridge project, Mecca
Mass Transit and the Mecca-Medina VHS line
Promising growth rates in other countries such
as South Africa, Egypt in mainline and urban
VHS demand mainly stemming from smaller
markets (e.g. Morocco)
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Driven by the economic success Brazil, Latin America is also
expected to become a growth driver for the industry
Market development Latin America
CURRENT ACCESSIBLE MARKET
Market volume p.a. [EUR bn]
3.9
0.4
0.7
1.0
1.9
2009-2011
Rail control Infrastructure Services Rolling stock
1) Compounded annual growth rate 2015-2017 vs. 2009-2011
CAGR [%] 1)
7.0% to 7.5%
5.0% to 5.5%
5.0% to 5.5%
4.5% to 5.0%
9.5% to 10.0%
KEY DEVELOPMENTS
Brazil with plans of doubling its freight rail
network to support the growing economy
Plans for solutions in urban transport in Brazil
drafted, proposed and partially approved
Projects include extensions of Sao Paulo and
Rio de Janeiro metro, metro/light rail in Belo
Horizonte, Brasilia, Cuiabá, etc.
Argentina planning replacements of large
portions of its existing rail network – Santiago
de Chile metro entailing large investment
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Conclusion: Steady and sustainable growth of the rail supply
industry and positive perspectives for European suppliers
2012 study confirms that the rail supply industry has
successfully navigated economic downturn
Growth of rail supply market will continue well through 2015 -
2017 based on a generally favorable environment for rail
Growth regions Africa & Middle East and Latin America enlarge
market significantly in countries with so far small rail systems
Even countries with abundant fossil fuels such as in Middle East
increasingly emphasize rail and build new rail systems
European rail supply industry will continue to benefit from growth
perspectives based on its export strength and innovation
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