Increasing transport demand, as well as fleet refurbishments and new product platforms will spur an average worldwide growth rate of around 6% per year up to 2015. At present, railway operators around the world are investing Euros 3.3bn annually in new electric locomotives and around Euros 2.5bn per year in the service and maintenance of their fleets. However, dynamic growth in Asia, Eastern Europe and the former Soviet Union is expected to increase these margins over the next few years.
In total there are almost 47,000 electric locomotives currently in operation worldwide with an average age of around 27 years. While the proportion of electric locomotives has increased considerably in the past few years, diesel traction remains dominant, with electric locomotives accounting for less than 30% of all locomotives worldwide.
Asia, the former Soviet Union and Western Europe account for almost 84% of these, with China, Russia and India increasing their fleets considerably in the last few years. The remaining 16% of the market is mainly divided between Eastern Europe and South Africa. In the Pacific region and Australia, as well as in North and South America, diesel traction continues to dominate with only a few hundred electric locomotives in operation.
A substantial proportion of these locomotives are either operated solely for freight or used universally. The proportion of units used specifically for passenger transport has declined rapidly in the last few years due to the growing prevalence of emus.
The largest national fleets of electric locomotives are found today in China, Russia and India followed by Germany, Italy and France. Almost 60% of the worldwide fleet is operated in these six countries, with the remaining 40% divided among 62 countries.
As procurements increase and old vehicles are replaced, SCI Verkehr assumes that the average fleet age will decrease slightly in the next few years.
It is also estimated that the current high procurement volume in Asia will continue, particularly in China and India where significant efforts are underway to increase the size of electric locomotive fleets. With this in mind, local manufacturers are expanding production capacities, while established players are trying to enter the Asian market.
In Western Europe extensive procurements by incumbent railways are almost complete meaning that procurement activities will decline in the next few years. However, a demand will always exist for new electric locomotives due to the overall size of the region's fleet, while Europe's high prices ensures it remains important for total market volume.
Despite stagnation in Western Europe, procurement in Eastern Europe, and especially in the former Soviet Union, is expected to gain momentum as increasing market deregulation, along with the associated competition, fuels the need for new locomotive purchases. And with relatively old existing electric locomotive fleets in these regions, replacement will be necessary in the foreseeable future.
Inevitably the size of existing fleets in the three leading regions is driving high after-sales volumes. In Asia, a widespread rejuvenation of national fleets has led to a decline in locomotive refurbishments, while expenditure on repair and maintenance services has increased. In Western Europe development of the after-sales volume is comparatively moderate because new vehicle procurement has had priority over refurbishment. However, with increasing privatisation and new operators entering the market, refurbishment intensity is expected to increase.
Nearly 6200 electric locomotives have been produced in the past five years. Siemens, Bombardier and Alstom account for a third of the overall market volume, while regional suppliers such as Skoda, Talgo, CAF, and Stadler Winterthur in the field of shunting, are beginning to make inroads into the European market with new developments.
Chinese manufacturers are responsible for a third of supply with this share primarily based on sales in Asia, although Chinese suppliers are intensifying their export activities. Chinese electric locomotives have already been exported to Kazakhstan, Uzbekistan and Iran.
Like China, Russia and India rely heavily on their own production facilities for electric locomotives, which have reached their production capacity limits. However, they are keen to cooperate with established European suppliers, especially for high-powered drive systems. Examples include cooperative agreements or joint ventures between the Russian manufacturer Sinara and Siemens as well as between Transmashholding and Alstom.
Transmashholding has intensified its electric locomotive production capacity in the last few years to the extent that it now has a 16% share of total global production. In India, units in operation are mostly produced domestically by manufacturers BHEL and CLW, and procurement has grown in the last few years, resulting in a total market share for Indian manufacturers of 15%.
An increasing trend towards local suppliers is particularly evident in Eastern Europe. New electric locomotive manufacturers with their own production facilities include Pesa and ZNLE in Poland, the Czech manufacturer Skoda, and Tülomsas in Turkey.
Following the Western European trend, multi-system locomotives are becoming increasingly common in Eastern Europe due to their capability to offer cross-border European freight services. New dual-power product concepts will enhance competition as they are expected to promote the independence of private freight transport operators from state services, however, it remains to be seen where suppliers like Bombardier, Stadler, Vossloh, CAF and Pesa will target their new dual-power locomotives. Bombardier has already sold dual-power locomotives in North America.
Competition is then likely to be fierce among these manufacturers with much to gain over the next few years despite the uncertainty in global financial markets. Rail's environmental credentials and capacity advantage has elevated it in many areas as the mode of choice for freight operations, sustaining demand for electric locomotives that are increasingly required to offer efficient and effective cross-border and long-distance operations.