Rail Freight Market Size to Grow by USD 29.29 Billion | Low Cost of Rail Freight to Boost Market Growth | 17,000+ Technavio Research Reports

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Key Market Dynamics:

• Market Driver

The low cost of rail freight and robust investments in freight corridors are some of the key market drivers. The cost of transporting goods to far-off places through rail freight is lesser than road and airfreight. For instance, the cost of transporting goods via rail freight between China and Europe is about 80% lesser than airfreight. Furthermore, the rise in fuel prices are leading to a surge in road freight charges and airfreight operations. These factors are driving the popularity of rail freight services among shippers. Moreover, in domestic freight transport, rail freight is more economical than both air and road transports due to the low direct cost associated with rail freight. These factors will impact the rail freight market positively during the forecast period.

• Market Challenges 

However, factors such as increasing maintenance expenses will challenge market growth. The increase in maintenance cost of rail infrastructure and the non-competitive pricing of rail freight is another negative factor that can hamper the growth of the global rail freight market during the forecast period. The maintenance cost of railways includes the cost of maintaining and upkeeping trains, stations, loading docks, and signaling systems. The average maintenance cost is around 25%-30% of the total operating cost of rail freight. Thus, the maintenance cost of railway companies constitutes a significant part of their expenditure.

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Key Market Segment Analysis:

The rail freight market report is segmented by Destination (domestic and international) and Geography (APAC, Europe, North America, MEA, and South America). Domestic segment led the largest rail freight market share in 2021 and will continue to account for the largest share during the forecast period. The growth of this segment cannot be attributed to the preference for rail freight by end-users due to the low direct cost associated with rail freight in the transportation of goods. In addition, rail freight offers a solid and safe solution for transporting flammable goods such as oil, petroleum, natural gas, coal products, chemical products, and other derivatives of crude oil. 

In terms of Geography, APAC will be the leading region with 34% of the market's growth during the forecast period. The region will account for the highest market revenue during the forecast period mainly due to the lower cost of rail freight transportation and the significant increase in industrial and cross-border trade activities in developing countries in APAC, such as China and other countries China, India, and Japan are the key markets for rail freight in APAC. 

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Top Market Players Analysis

The rail freight market is fragmented and the vendors are deploying various organic and inorganic growth strategies to compete in the market. Companies in the market are looking forward to launching innovative solutions to gain an upper edge in the market. They are also engaging in merges and acquisitions to strengthen their leadership and presence in the market. 

Strategic Initiatives: In July 2021, CSX Corp. acquired Quality Carriers Inc., a leading North American provider of bulk liquid chemicals truck transportation. In November 2021, the company acquired Pan Am Railways Inc. in New England.  In October 2021, WSP Global Inc. acquired Englekirk, a service company. In April 2021, the company acquired b+p baurealisation, a 100-employee engineering and consulting firm.

Some Other Dominant Players Covered in this report are:- 

•           
• BNSF Railway Co.
• Brookfield Business Partners L.P.
• Canadian National Railway Co.
• Canadian Pacific Railway Ltd.
• Colas SA
• CSX Corp.
• Dassault Systemes SE
• Deutsche Post AG
• SNTFM CFR Marfa SA
• WSP Global Inc.
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Key Topics Covered:

• Executive Summary
• Market Landscape
• Market Sizing
• Five Forces Analysis
• Market Segmentation by Destination
• Customer landscape
• Geographic Landscape
• Vendor Landscape
• Vendor Analysis
• Appendix

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