Smart Railways Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

Smart Railways Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

The Smart Railways Market is expected to register a CAGR of 9.74% during the forecast period. Increasing demand for freight transportation and urban mobility necessitates new approaches to railway operations. The worldwide rail market is predicted to continue its steady expansion, with urban transportation experiencing the fastest increase. This fast growth and a restricted network place tremendous strain on railway operators attempting to meet the next generation of passenger and freight needs.

• The growing need for urban connectivity, more integration of IoT-based technology, and a strong emphasis on lowering emissions are all likely to fuel the emergence of the "smart railway" system.
• Moreover, with growing numbers of railway passengers along with revenue from passengers, the smart railways market is expected to grow in order to handle the increased rail traffic. For instance, according to IBEF, the value of earnings from rail passenger traffic across India increased from USD 2.03 billion in 2021 to USD 4.66 billion in 2022 (till March 2022).
• Railroads are also leveraging historical big data resources to allow preventive modeling and use machine learning to tackle problems in novel ways. Operators are leveraging smart technology to give integrated digital experiences, such as driver-machine interface and infotainment, to improve passenger and driver experiences and efficiency.
• The substantial initial infrastructure expenditure required stymies the development of smart train systems. Due to the employment of modern technology, the deployment of smart railway lines necessitates substantial expenditure. Cabling a train for network connectivity is expensive, especially over a wired Ethernet network, due to the high installation expenses. Additionally, rewiring may be required each time the train is modified, raising maintenance expenses. Moreover, failure of any infrastructure part after installation due to a technical error or integration difficulty can have severe effects, including loss of life and considerable replacement expenses. Hence, it is predicted that the high initial cost of implementation will limit the worldwide smart railway systems market.
• In the post-COVID-19 scenario, the market outlook was positively impacted by rising demand for biometric, integrated, contactless & mobile payment adoption, sensor-based technology, and ticketing technologies throughout public transit. Moreover, the development by various companies is also expected to boost the demand for smart railways.

• Cities worldwide have become smarter as a result of the increased population of hyper-urbanization and globalization. Connected technologies and Smart services play critical roles in urban transformation by improving urban services' quality, efficiency, and interactivity, optimizing resources, and lowering costs.
• With the expected increase in passengers and freights, the worldwide urban population expansion is expected to enhance the demand for railways to apply intelligent solutions.
• According to the United Nations Department of Economic and Social Affairs, 68% of the world's population is predicted to live in urban areas by 2050. Africa and Asia are expected to contribute to 90% of this increase. In certain countries, including India, up to 60 individuals move into cities every hour.
• According to the United Nations, 86% of the developed world will be urbanized by 2050. More people are living in cities than ever before, with estimates estimating that 60% of the world population lives within 5 km of a city. Thus, with urbanization at this rate, the burden on public services and resources swiftly grows.
• Smart rail service will be critical in tackling the problems of an expanding population. A smart rail is a future-proofing option as it delivers a high-capacity, safe, low-emission alternative for urban mass transit. It not only provides a sustainable option for carrying suburban people to and from metropolitan regions, but it also frequently connects to other vital transportation hubs such as ferries, airports, and spaceports in the not-too-distant future. Smart cities may become more sustainable with autonomous, on-demand, and networked train services.
• Rail is a safe, efficient means to move large groups of people swiftly and reliably, and contemporary, sophisticated train systems are evolving to be more economically sustainable and ecologically beneficial. Smart rail is a critical component of end-to-end multimodal service.

• The expansion of an intracity network in Asia-Pacific and digital signage, smart ticketing, and Wi-Fi connectivity stores that provide additional entertainment options or increased productivity are projected to drive the region's adoption of smart railways.
• China's enormous railways are essential to the country's national and urban transportation infrastructures, and the country already has some world-class systems. China, for example, has the world's largest high-speed rail network, reaching over 37,000 km (22,990 miles) and accounting for 64% of global high-speed networks.
• Furthermore, in this region, the respective governments have made considerable efforts to "upgrade" and "revamp" existing lines to improve overall operating efficiency. Furthermore, the development of megacities is predicted to be strongest in emerging Asia-Pacific countries.
• According to the India Brand Equity Foundation, investment in Indian railways was estimated to amount to approximately USD 124 billion between 2018 and 2022, which was USD 58.96 billion between 2012 and 2017. Such huge investment in the development of railways would further boost the demand for smart railway solutions in the region.
• In November 2022, a consortium of Japanese firms produced open-source software for private 5G networks, claiming to provide a low-cost 5G core (5GC) network that reduces the cost of private infrastructure domestically. Furthermore, in August 2022, IBM Corp. and VMware Inc. expanded their partnership further to assist their customers' information technology modernization initiatives.
• In January 2022, with the opening of the China-Laos railway, China's global railway infrastructure was being built, using tracks and concrete to deliver a faster digital communications network. Huawei's Smart Railway Solutions are used in the new China-Laos rail link, and Huawei is working with Laotian telecom providers to build a high-speed network along the high-speed line. Travelers and rural residents would benefit from its reliable connectivity.
• Such ongoing investments by the government and regional players to develop and strengthen the railways by deploying smart railway solutions would boost the growth of the market studied.

The smart railways market is highly fragmented, with the presence of major players like Cisco Systems Inc., IBM Corporation, ALE International, Huawei Technologies Co. Ltd, and Siemens AG. Players in the market are adopting strategies such as partnerships, collaborations, and acquisitions to enhance their product offerings and gain sustainable competitive advantage.

In June 2022, at the Huawei Optical Innovation Forum, Huawei announced its new vision for optical transport networks. This new vision is centered on delivering the optical transport network (OTN) to edge nodes to provide all-pervasive premium connectivity and construct eco-friendly and straightforward optical networks, assisting operators in achieving financial success.

In March 2022, Cisco and Network Rail Telecom (NRT) collaborated to provide communications and connectivity to the community by utilizing government-owned fiber running through the station and third-party radios. The United Kingdom National Health Service was able to set up telehealth pods for remote consultations, testing, and diagnosis. It is one example of how rail technology is being used for the better. In this podcast, they look at all the opportunities that rail technology provides. This includes smart rail benefits for employees and passengers and ongoing collaborations to improve rail operations and management.

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support