by Locomotive leasing involves renting locomotives on a long-term contractual basis by rolling stock operators and railway companies. Locomotives help in cargo transportation including coal, iron ore, minerals, containers and other goods. They are utilized by various industries including mining, construction, and logistics for freight transportation. The growing global freight transportation due to increasing international trade is augmenting the demand for locomotives. Locomotives facilitate bulk cargo transportation in large volumes over long distances in a cost effective manner. The global locomotive leasing Market is estimated to be valued at US$ 10.07 Bn in 2023 and is expected to exhibit a CAGR of 7.7% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics
Growing international trade is boosting freight transportation: International trade has witnessed significant growth over the past few decades on the back of improving global economic conditions and trade policies. This has increased the volume of freight transportation globally. According to the World Trade Organization (WTO), the volume of world merchandise trade grew by 4.7% in 2017 compared to 2016. Global freight transport is dependent on locomotives for bulk cargo movement over long distances. This growing freight volume is expected to augment the demand for locomotive leasing during the forecast period.
Rising mining and construction activities driving bulk cargo transportation: Mining and construction industries engage in large scale extraction and transportation of commodities such as coal, iron-ore, and base metals. Locomotives play a critical role in bulk transportation of commodities from mines and production sites to smelters, ports and other consumption centers. According to World Coal Association, the global coal production touched 7,855 million tonnes in 2017. The growing mining output is anticipated to propel the bulk cargo volume, spurring the demand for locomotive leasing.
Segment Analysis
The locomotive leasing market is dominated by railway and subway segment which accounts for over 60% market share. Locomotive leasing plays a crucial role in rail transportation globally. Railway segment has the largest fleet of locomotives that require regular maintenance and replacement. The growing rails infrastructure projects in developing nations has expanded the locomotive fleet size thereby driving the segment growth. The subway segment follows railway segment with around 25% share owing to rising investments in mass transit systems in urban cities.
PEST Analysis
Political: Governments across nations are investing heavily in rail infrastructure projects to promote sustainable transport. Favorable investment policies and land acquisition reforms have accelerated new line and network expansion works.
Economic: Growth in global trade has expanded freight transport demand propelling the demand for locomotives. Rising GDP and urbanization has boosted passenger travel boosting transit infrastructure spending.
Social: Population growth in cities and changing mobility preferences of current generations is shifting demand towards public transit solutions. This has increased rail ridership and boosted investments subway network extensions.
Technological: Locomotive manufacturers are incorporating advanced technologies like predictive maintenance, remote diagnostics and telematics solutions to improve fleet operational efficiency. Some key players are also investing in battery-electric and hydrogen-powered locomotives.
Key Takeaways
The Global Locomotive Leasing Market Size is expected to witness high growth supported by rising government investments in developing countries rail infrastructure modernization projects. Regionally, Asia Pacific accounts for the largest share led by China, India and Southeast Asian nations rapidly building railway networks and metro lines especially connecting tier 2 and tier 3 cities.
Key players operating in the locomotive leasing market include Orenco Systems, WPL Ltd, Bio-Microbics, Albion Septic System, Premier Tech Aqua, Septic Solutions, BTL LINEDRAIN, Pumps UK LTD, Anua, Tricel, Infiltrator Water Technologies, Hoot Systems, Zoeller, Hess Pumien, RootX, Jet Inc, SJE Rhombus, Norweco, Aero-Stream, Perma-Liner Industries. WPL Ltd and Orenco Systems are amongst the largest lessors with modern fleets of diesel, electric and dual-mode locomotives.
The growing demand for more energy efficient, environment-friendly and technologically advanced locomotives is prompting key players to invest in battery-electric and hydrogen locomotives. Partnerships with railway operators and rolling stock manufacturers will be crucial for lessors to acquire new generation low carbon fleets. Regional expansion especially in high growth Asian and African markets will further strengthen competitive position in the coming years.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
