Locomotives · Strategic overview of key mega trends

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Last updated: June 15, 2019

Locomotives and rolling stock is an assembly of complexindividual components. Tier 1 consists of large and small original equipment manufacturersthat design, manufacture, and assemble the body of passenger and freight railvehicles—locomotives, rail cars, and both diesel and electrical multiple units(DMUs/EMUs).The Tier 1 companies are also known as system integratorsand represent the large companies such as Alstom, Bombardier, GE, Kawasaki orSiemens. These system integrators tend to keep the high-value roles, such asdesign, engineering, and systems integration.

Tier 2 is divided into three systems: propulsion,electronics and body, and interior. Each of these systems includes severalmajor components, which are listed in the figure above. The Tier 2manufacturers integrate components such as steel plates, frames, couplers, wheels,and assembles communications gear, engines, motors, transmissions into systems.Suppliers of major equipment collaborate with differentmanufacturers for efficient and smooth assembly of final product. A limitednumber of manufactures within Tier 2 are also active in Tier 1 and providetheir own subsystems (mainly propulsion systems) and in some cases supply themto other OEMs.Tier 3 includes firms that supply parts and materials tocompanies in the top two tiers.Topline SummaryIssues addressed in the reportare:·       Strategicoverview of key mega trends influencing the global rail rolling stock industry,including rolling stock manufacturers, wheel & axle providers, locomotives,wagon and trainset manufacturers.

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·       Worldwidemarket size and forecasted growth for Rail Rolling Stock focusing onapplications such as Trainsets, Locomotives, Wagons and Cars, broken down forkey regions across North America, South America, Europe, Middle East – Africa,and Asia – Pacific.·       Marketdrivers and opportunities in the global market and discussed the regionalinfluence on market dynamics.·       Suppliermarket shares, product availability, alliances, and strategies and overview ofkey technology trends.·       Marketforecasts of global sales of rolling stock for 2017–2022.

·       Strategiesfor success for both suppliers, current and potential usersNegligible growth is noticed with an estimated market size ofworldwide Rail Rolling Stock industry increased from $64.90Billion in 2016 to $64.97 Billion in 2017.

Faster, more reliable and flexible trains will be able toincrease the reliabil­ity and cost-competitiveness of this mar­ket segment. ITsystems that enable buy­ing and selling of capacity in wagons and a reliabledoor to door track and trace of loading units and goods and real time in­formationof the actual and forecasted train position will further attract the cus­tomerto rail. The performance of the vehicles needs to be improved.Power trains will consume less energy, components will become light­er,standardization of regenerative braking and recuperation of kinetic energy. Newvehicles will be built to be recyclable and innovative materials will be used. The rate of growth in the supplier market has slowed inlast few years and estimated to grow at 2% a year up to 2022.

Due to slowmarket growth in this segment, very few or no investments would be made towardsnew improvements. In addition, political uncertainties and change ingovernments in several regions will delay or cancel of new investmentsstrategies. Due to uncertain commodity prices, change in emission regulations,and fluctuating natural resource prices have led to decline of rail freight market.

While, urbanization have stimulated long-term growth of passenger rail market. Ithas been noticed that China has increased its investment urban rail to addressurbanization, while reduced its investments in conventional and high-speedrail. The large market share of Chinese manufacturers is leading to a strongfocus on international markets and creating price pressure on the globalsuppliers. This has resulted in consolidation of the railway industry (as wenoticed Alstom and Siemens merged their rail operations to counter Chinesedominance) and it will even accelerate.

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