The global Railway Wiring Harness Market is estimated to be $1.5 billion in 2021 and is projected to reach $1.9 billion by 2026, at a CAGR of 4.6% during the forecast period.
The key players considered in the analysis of the railway wiring harness market are Hitachi Ltd. (Japan), Prysmian Group (Italy), TE Connectivity (Switzerland), Leoni (Germany) and Nexans (France).
Opportunity: Growing Trend of Driverless Trains
Developed countries have initiated plans for the advancement of driverless train networks, which is expected to propel the growth of the transportation sector. Countries such as China, India, South Korea, the US, the UK, Mexico, Brazil, and South Africa are planning to revolutionize their rail networks with the introduction of driverless trains. Rail manufacturers are expanding geographically by investing in infrastructure for the manufacture of driverless trains. Developed regions like North America and Europe are improving the safety and security of railways by retrofitting trains and replacing existing systems with advanced systems. These retrofitting and deployment of new driverless trains require an extensive amount of wiring, which creates a huge opportunity for the growth of the railway wiring harness market. For example, in the European region, a new initiative known as the fourth railway package has been undertaken to create a single European rail area with structural and technical reforms. The initiative aims at providing high levels of safety, interoperability, and reliability to the European rail network. These developments are expected to boost the market for the railway wiring harness. In 2018, the International Association of Public Transport (UITP) Observatory of Automated Metros, the body commissioned to disseminate and share knowledge about automated metro lines, announced that driverless metros across the world have surpassed a total of 1,000km. The opening of the Pujiang Line in Shanghai, China helped achieved this milestone, and there are 63 fully automated operations (FAO) lines in 42 cities across 19 countries in the world. Asia and Europe contribute 75% of the kilometres of fully automated metro lines, while Europe is expected to host 26% of the growth expected over the next decade, mainly in conversion projects. In May 2020, the German Federal Ministry of Economics presented Alstom with the “Innovation Prize for Regulatory Sandboxes”*, related to a planned test project to implement Automatic Train Operation (ATO) in daily passenger operation of regional trains. The project will begin in 2021 together with the Regional Association of the greater area of Braunschweig, the German Aerospace Center (DLR), and the Technical University of Berlin (TU Berlin).
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The market is principally driven by the increasing rail projects, government investment in railways, increase in rail network length, adoption of metro and high-speed rail. For example, in December 2019, Deutsche Bank announced plans to invest USD 12.6 billion for new trains by 2026. In October 2020, Turkey announced the expansion of its railway network to 16,675 km by 2023 from 12,803 km 2020. In February 2020, the European Investment Bank allocated USD 1,081.3 million for European rail projects for a variety of rail fleets. In 2019, Russia planned to invest USD 2.70 billion in the development of railway infrastructure to increase freight container volume by 2024. Asia Pacific region is estimated to hold the largest market share of 49.7%, by value, in 2021, followed by Europe with 30.3%, and North America with 8.7%.
The Asia Pacific region is the largest and the fastest-growing region due to the increasing infrastructural developments, increase in government spending on the transportation sector, and the ongoing/upcoming projects in various countries. China’s rapidly growing economy is driving the expansion of urban transit and high-speed train network, and the enhancement of transport systems in the country, thereby making it the fastest-growing railway industry in the world. More than 20,000 km high-speed rail network is operational in China while an additional 45,000 km is currently in the developmental phase.
The traction system is estimated to account for the largest market share, in terms of value. The growth of the segment is driven by the consistently increasing rail-based intercity and intracity transportation. Increasing adoption of rolling stock and rising investments by governments for infrastructure development is expected to propel the growth of the rapid transit market, which would further support the demand for wiring harnesses for traction systems. For instance, the Indian government has allocated a fund of USD 340.4 million for Regional Rapid Transit System (RRTS) projects in the Budget for 2020-21. Such investments in the expansion of rail infrastructure and the development of new projects are expected to boost the market growth.
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To reduce emissions, governments are planning to convert existing diesel fleets to electric locomotives. The Indian Government plans to convert its diesel locomotives with lifeless than five/six years to electric locomotives. This is expected to provide an additional life of five to ten years with the use of 12000 HP, 9000 HP locos, wherein earlier 4500HP locos were used. These developments are expected to offer opportunities for the growth of the market in the future. This is estimated to support the growth of railway wiring harnesses for traction systems.
High-speed/bullet train is estimated to show the highest CAGR growth by train type. Increasing demand for high-speed/bullet trains, urbanization, and investments for the development of urban transit systems by governments is another important factor for the growth of railway wiring harnesses for high-speed/bullet trains, globally. Various governments have announced investments in rail infrastructure. For instance, China invested USD 50.3 billion in the railway sector during the first half of 2020, leading to the growth of the market.
Power cable holds the largest market share in the railway wiring harness market because of the growing adoption of electricity consuming systems in the train which requires high voltage. According to the International Union of Railways (UIC), the global extension of the high-speed rail network could reach more than 80,000 km by 2035. This transition in the transportation sector is the cause of rapidly growing urbanization globally. Several countries such as China, France, Germany, and Spain have developed high-speed train projects just after its introduction in the rail industry. The acceptance of high-speed trains is anticipated to rise in the near future due to the prospects of economic growth created by the development of high-speed rails. These factors foster the exponential growth of the power cable during the forecast period.
