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RAILWAY ENGINEERING-UK-MARCH 2018

Published By :

Mintel

Published Date : Mar 2018

Category :

Transport & Logistics

No. of Pages : N/A

Orders for new passenger trains are at a historically high level, with more than 6,000 carriages committed to between April 2014 and March 2021, according to the latest Long Term Passenger Rolling Stock Strategy. With a capital cost of more than £10 billion, around 50% of these new vehicles are expected to be built in Britain. In response to the sharp upturn in UK train orders, and with further lucrative orders on the horizon, most notably HS2, a number of major train manufacturers are investing heavily in UK facilities. While the new rolling stock introduction is expected to peak with the delivery of current orders, the long-term outlook for new build remains positive.

Table of contents
EXECUTIVE SUMMARY
The market
Government funding for railway sector falls in 2016/17, as funding for Crossrail ends
Figure 1: Government railway funding, 2013-17
Network Rail overspends on renewal schemes in first three years of current control period CP5
Figure 2: Rail renewal expenditure by asset, 2016/17
Network Rail embarks on largest rail enhancement and investment programme in CP5 2014-19
But this major rail modernisation programme is posing significant challenges for Network Rail
UK rolling stock fleet growing at fastest rate for decades
31 major rail projects currently in infrastructure pipeline
Figure 3: Rail infrastructure pipeline, as of autumn 2017
HS2 will be by far the largest rail infrastructure project over the next two decades
Market factors
Network Rail’s funding and delivery outputs are agreed in five-year blocks called control periods
Recommendations set out in Shaw report could result in biggest shake-up of Network Rail since privatisation
Network Rail launches transformation plan in 2016, implementing many of the measures set out in Shaw report
Government publishes strategic vision for rail
Companies
What we think
KEY INSIGHTS
What steps has Network Rail taken towards devolution since the launch of its transformation plan in 2016?
What are the key proposals contained in the government’s Strategic Vision for Rail?
What are the government’s proposed changes to the franchising system set out in its Strategic Vision for Rail?
How is the UK passenger rolling stock fleet expected to develop?
INTRODUCTION
Definitions
Methodology
Abbreviations
Market positioning
UK ECONOMY
Overview
Figure 4: Forecast GDP development 2016-22
Figure 5: UK GDP quarterly development, 2004-17
Inflation
Interest rates
House prices
Figure 6: UK house price changes, 2006-17
Consumer spending
Manufacturing
Figure 7: UK manufacturing, 2014-17
Business investment
Figure 8: UK GFCF, chained volume measures, seasonally adjusted, 2004-17
Imports
Exports
MARKET FACTORS
Key points
Drivers of investment in rail industry
Rail network funding and regulation
Sir Peter Hendy’s re-plan for Network Rail’s enhancement programme 2014-19
The Shaw report
Network Rail launches transformation plan in 2016, implementing many of the measures set out in Shaw report
RAIL FINANCE
Key points
Overview
Figure 9: Government railway funding, by type, 2013-17
Figure 10: Private investment in railways, by type, 2013-17
INFRASTRUCTURE INVESTMENT
Key points
Introduction
Figure 11: Rail infrastructure in Great Britain, 2012-17
Figure 12: Rail infrastructure in Great Britain, 2013-17
Network Rail embarks on largest rail enhancement and investment programme in CP5 2014-19
Capital expenditure
Figure 13: Rail infrastructure renewals, enhancements & maintenance expenditure in Great Britain, 2012-17
Figure 14: Rail infrastructure renewals, enhancements & maintenance expenditure in Great Britain, 2012-17
Expenditure analysis
Figure 15: Analysis of enhancement expenditure in Great Britain, by type, 2016-17
Figure 16: Renewal expenditure by asset, 2016 and 2017
Figure 17: Private sector investment in track and signalling, 2013-17
Figure 18: Private sector investment in stations, 2013-17
ROLLING STOCK
Key points
Overview
Current trends and challenges in the rolling stock market
Passenger rolling stock parc
Figure 19: Rolling stock parc, as of March 2017
UK rolling stock fleet growing at fastest rate for decades
Average age of rolling stock
Figure 20: Average age of rolling stock, by sector, 2013-17
Figure 21: Average age of rolling stock, by sector, 2013-17
Figure 22: Average age of rolling stock, by company, 2013-17
Use of railways
Figure 23: Number of passenger journeys, by sector, 2013-17
Figure 24: Share of passenger journeys, by sector, 2016/17
Figure 25: Freight train kilometres on Network Rail infrastructure, 2013-17
Private sector rolling stock investment
Figure 26: Private sector rolling stock investment in Great Britain, 2013-17
Figure 27: Private sector rolling stock investment in Great Britain, 2013-17
SUPPLY SOURCES
Key points
Production
Overview
Figure 28: UK production of locomotives, rolling stock and other equipment, 2012-16
Segmentation
Figure 29: Segmentation of the UK production of locomotives, rolling stock and other equipment, by type, 2012-16
Imports
Overview
Figure 30: UK imports of locomotives, rolling stock and other equipment, 2013-17
Segmentation
Figure 31: Segmentation of UK imports of locomotives, rolling stock and other equipment, by type, 2013-17
Figure 32: UK imports of locomotives, rolling stock and other equipment, by type, 2017
Exports
Overview
Figure 33: UK exports of locomotives, rolling stock and other equipment, 2013-17
Segmentation
Figure 34: Segmentation of UK exports of locomotives, rolling stock and other equipment, by type, 2013-17
INVESTMENT PROFILES
Key points
Introduction
Figure 35: Train operating companies, as of January 2018
DfT proposes changes to franchises in its 2017 ‘Strategic Vision for Rail’
Train operating companies
Abellio Greater Anglia
Figure 36: Key statistics for Greater Anglia, 2015-17
Arriva Trains Wales
Figure 37: Key statistics for Arriva Trains Wales, 2015-17
c2c
Figure 38: Key statistics for c2c, 2015-17
Chiltern Railways
Figure 39: Key statistics for Chiltern Railways, 2015-17
Cross Country
Figure 40: Key statistics for Cross Country, 2015-17
Virgin Trains East Coast
Figure 41: Key statistics for Virgin Trains East Coast, 2015-17
East Midlands Trains
Figure 42: Key statistics for East Midlands Trains, 2015-17
Eurostar
Thameslink, Southern, and Great Northern (TSGN)
Figure 43: Key statistics for Govia Thameslink Railways, 2015-17
Great Western Railway
Figure 44: Key statistics for Great Western, 2015-17
First Hull Trains
Abellio ScotRail
Figure 45: Key statistics for Abellio ScotRail, 2015-17
TransPennine Express
Figure 46: Key statistics for TransPennine Express, 2015-17
Grand Central
Heathrow Connect
Heathrow Express
West Midlands
Figure 47: Key statistics for London Midland, 2015-17
London Overground
Figure 48: Key statistics for London Overground, 2015-17
Merseyrail
Figure 49: Key statistics for Merseyrail, 2015-17
Northern Rail
Figure 50: Key statistics for Northern Rail, 2015-17
North Yorkshire Moors Railway
Southeastern
Figure 51: Key statistics for Southeastern, 2015-17
South West Trains
Figure 52: Key statistics for South West Trains, 2015-17
TFL Rail
Figure 53: Key statistics for TFL Rail, 2016-17
Virgin Trains West Coast
Figure 54: Key statistics for Virgin Trains West Coast, 2015-17
West Coast Railway
Freight operators
Colas Rail
Figure 55: Key statistics for Colas Rail, 2017
Direct Rail Services
Figure 56: Key statistics for Direct Rail Services, 2017
DB Cargo UK (formerly DB Schenker Rail)
Freightliner Group
Figure 57: Key statistics for Freightliner in the UK, 2017
GB Railfreight
Figure 58: Key statistics for GB Railfreight, 2017
Mendip Rail
Rolling stock operating companies
Angel Trains
Porterbrook Leasing Company
Eversholt Rail Group
QW Rail Leasing
Network Rail
London & Continental Railways/HS1
High Speed Two Ltd
Civils contracts for phase 1 awarded in July 2017
Shortlisted bidders for HS2 train contracts revealed in November 2017
Contractors shortlisted for HS2 station design contracts
SUPPLY INDUSTRY STRUCTURE
Key points
Industry development
Hitachi starts production at new UK manufacturing plant in 2016, joining Bombardier as the country’s only rolling stock manufacturers
Spanish rolling stock manufacturer CAF plans to open UK assembly plant in 2018
Alstom also considering UK manufacturing if firm wins major UK contracts
Government Strategy for UK Railway Supply Industry
Industry structure
Figure 59: Analysis of the changes in the structure of the railway & tramway rolling stock manufacturing industry, 2013-17
Structure by employment
Figure 60: Analysis of the employment structure of the railway & tramway rolling stock manufacturing industry, 2016-17
Structure by turnover
Figure 61: Analysis of the financial structure of the railway & tramway rolling stock manufacturing industry, 2016-17
Company profiles
ALSTOM TRANSPORT UK
Alstom opens new rolling stock modernisation facility in 2017
Alstom announces merger with Siemens Mobility in 2017
Company strategy:
Figure 62: Financial analysis of Alstom Transport UK, 2014-17
BOMBARDIER TRANSPORTATION UK
Figure 63: Financial analysis of Bombardier Transportation UK, 2012-16
Company strategy & outlook
AMEC FOSTER WHEELER
Transformation programme sees Amec Foster Wheeler sell non-core assets
Amec Foster Wheeler acquired by Wood Group in October 2017
Company outlook
Figure 64: Financial analysis of AMEC Foster Wheeler, 2012-16
AMEY/AMEY RAIL
Recent acquisitions
Amey UK launches transformation programme in 2016
Figure 65: Financial analysis of Amey UK, 2012-16
Amey Rail
Company performance
Figure 66: Financial analysis of Amey Rail, 2012-16
ANGEL TRAINS
Figure 67: Financial analysis of Angel Trains, 2012-16
Company strategy & outlook
BALFOUR BEATTY GROUP
Build to Last transformation programme launched in 2015
Figure 68: Financial analysis of Balfour Beatty, 2012-16
Figure 69: Financial analysis of Balfour Beatty by segment, 2015-16
KNORR-BREMSE GROUP
Recent acquisitional activity
Figure 70: Financial analysis of Knorr-Bremse Rail Systems (UK), 2012-16
SIEMENS RAIL AUTOMATION HOLDINGS
Siemens and Alstom rail businesses to merge in 2018
Figure 71: Financial analysis of Siemens Rail Automation Holdings, 2013-17
Company strategy & review
BABCOCK RAIL
Figure 72: Financial analysis of Babcock Rail, 2013-17
Company review & outlook
NETWORK RAIL
Network Rail is delivering its biggest ever investment programme
Network Rail encounters major difficulties in delivering enhancement programme at the start of CP5
Company performance in 2016/17
Figure 73: Financial analysis of Network Rail, 2013-17
EVERSHOLT RAIL
Figure 74: Financial analysis of Eversholt Rail, 2012-16
PORTERBROOK LEASING COMPANY
Recent company activity
Company strategy
Figure 75: Financial analysis of Porterbrook Leasing Company, 2012-16
HITACHI RAIL EUROPE
Figure 76: Financial analysis of Hitachi Rail Europe, 2013-17
Company strategy
FORECAST
Key points
Market size
ORR’s original funding settlement for CP5
ORR introduces new targets for Network Rail’s asset management for CP5
Move towards framework agreements during CP5
Sir Peter Hendy’s Review and re-plan for CP5 enhancement programme
Funding for CP5 enhancement schemes enhanced by £2.5 billion
Network Rail implements Enhancements Improvement Programme
The Bowe Review
The Shaw Report
Network Rail launches transformation plan in 2016, implementing many of the measures set out in Shaw report
Government publishes its strategic vision for rail
DfT pledges £47.9 billion funding to Network Rail for CP6
Infrastructure
Additional funding for rail infrastructure announced in 2016 autumn statement
Rail sector announcements in Autumn Budget 2017
Rail infrastructure projects pipeline
Figure 77: Rail infrastructure pipeline, as of autumn 2017
Figure 78: Rail infrastructure projects pipeline, 2017
Crossrail
Thameslink Programme
Electrification schemes
But DfT postpones a number of electrifications schemes in 2016 and 2017
Other committed schemes
Other named schemes
HLOS capacity metric schemes
Borders
Other Scottish projects
High Speed Two (HS2)
Other proposed new rail lines
Rolling stock
Long term passenger rolling stock strategy
Figure 79: Fleet size requirements for passenger fleet under a low growth forecast, 2019-46
Figure 80: Fleet size requirements for passenger fleet under a medium growth forecast, 2019-46
Figure 81: Fleet size requirements for passenger fleet under a high growth forecast, 2019-46
Figure 82: Role of electric rolling stock under the medium growth forecast, 2017-46
Digital railway
FURTHER SOURCES & CONTACTS
Trade associations & regulatory bodies
Institution of Railway Signal Engineers
Light Rail Transit Association
Office of Rail Regulation
Rail Delivery Group
Railway Industry Association
Trade magazines
Global Railway Review
International Railway Journal
IRSE News
Modern Railways
Rail
The Rail Engineer
Railnews
Rail Professional
RailStaff
Rail Technology Magazine
Railway Gazette International
Railway Strategies
Trade exhibitions
Traffex 2019
Infrarail 2018

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