Asia-Pacific Locomotive Market Outlook to 2030

Asia-Pacific Locomotive Market Overview

• The Asia-Pacific Locomotive Market is valued at USD 5.6 billion. The markets growth is driven by the expansion of railway networks, government initiatives supporting infrastructure modernization, and increasing investments in sustainable and high-speed rail projects across the region.
• Key players in the Asia-Pacific Locomotive Market include CRRC Corporation, Siemens Mobility, Alstom, Kawasaki Heavy Industries, and Hyundai Rotem. These companies focus on innovative locomotive solutions, high-speed rail technology, and sustainability initiatives.
• BHEL and Kawasaki Heavy Industries are in advanced talks to establish a joint venture for manufacturing metro locomotives and steel coaches in India. This collaboration could increase BHEL's Bhopal unit turnover by 1,500 to 2,000 crore, supporting metro rail projects in various states.
• China led the Asia-Pacific Locomotive Market in 2023, driven by its extensive railway infrastructure and high investment in high-speed rail. Japan and India followed closely with their focus on modernization and expansion of railway networks.

Asia-Pacific Locomotive Market Segmentation

The Asia-Pacific Locomotive Market is segmented by type, propulsion, and region.

• By Type: The market is segmented into diesel locomotives, electric locomotives, and hybrid locomotives. In 2023, electric locomotives dominated the market due to the increasing focus on decarbonization and electrification of rail networks.

• By Propulsion: The market is segmented into freight, passenger, and shunting locomotives. The passenger locomotive segment held the largest market share in 2023, attributed to growing urbanization and demand for faster and efficient transportation options.

• By Region: The market is segmented into China, Japan, India, South Korea, Australia, and the Rest of APAC. China accounted for the highest market share in 2023 due to its strong investment in rail infrastructure and high-speed rail development.

Asia-Pacific Locomotive Market Competitive Landscape

• CRRC Corporation: Chinese CRRC Corporation has withdrawn from a 610 million Bulgarian train tender amid an EU investigation into alleged state subsidies. The EU's probe, aimed at ensuring fair competition, follows concerns that CRRC's bid substantially undercut local firms, raising issues of economic security and trade practices.
• Siemens Mobility: Siemens Ltd plans to invest over Rs 1,000 crore in expanding its operations in India, including Rs 186 crore for a new Metro train manufacturing facility in Aurangabad. This facility will serve as an export hub and align with sustainability initiatives under India's Make in India program.

Asia-Pacific Locomotive Market Analysis

Asia-Pacific Locomotive Market Growth Drivers:

• Expansion of Rail Networks:China and India are substantially investing in expanding their railway networks. China plans to add about 95,000 kilometers, focusing on high-speed rail. Indias initiatives, like the Dedicated Freight Corridor, aim to enhance freight transport efficiency, boosting the locomotive market.
• Electrification of Railways: Electrification is a key trend in China and India, aimed at reducing carbon emissions and enhancing efficiency. By 2023, China had electrified over 60% of its rail network, with plans for further expansion by 2028. India aims for 100% electrification, driving electric locomotive demand.
• Shift Toward Sustainable Transportation: The growing emphasis on sustainable transportation is accelerating the adoption of electric and hybrid locomotives, particularly in China and Japan. Indias green railway initiatives align with this trend, reflecting a global shift towards environmentally friendly solutions, further boosting the demand for electric locomotives.

Asia-Pacific Locomotive Market Challenges:

• High Costs of Modern Locomotives: The capital cost of electric locomotives can be substantially higher than that of diesel-electric locomotives. While a traditional diesel-electric locomotive costs around $2 million, recent orders for electric locomotives, such as Amtrak's Siemens ACS-64, have reached around $6.66 million each, highlighting the financial barrier for smaller economies.
• Infrastructure Modernization: In Southeast Asia, many countries face substantial challenges in modernizing rail infrastructure, with only about 20% of the region's rail network electrified as of 2022. This lack of modernization limits the operational capacity and efficiency of rail systems, hindering potential market growth in these areas.

Asia-Pacific Locomotive Market Government Initiatives:

• Bangladesh Railway: During Prime Minister Sheikh Hasina's visit to India in May 2023, Indian Railways provided Bangladesh Railway with 20 broad gauge diesel locomotives as a grant. This initiative aims to enhance Bangladesh's rail transport system to better manage increasing passenger and freight operations.
• Indias National Rail Plan: Indian Railways is integrating hydrogen fuel cell locomotives into its fleet to promote sustainable mobility. This initiative is part of India's National Rail Plan, with design and manufacturing processes already underway, aiming to reduce carbon emissions and improve the efficiency of rail transport.

Asia-Pacific Locomotive Future Market Outlook

The Asia-Pacific Locomotive Market is projected to grow steadily due to the ongoing expansion of high-speed rail networks, rising demand for energy-efficient locomotives, and technological advancements in the sector.

Asia-Pacific Locomotive Future Market Trends:

• Development of Autonomous Locomotives: In the coming years, research in autonomous locomotives will advance rapidly, with Alstom expected to demonstrate GoA4 automation in shunting operations. The intelligent obstacle detection system will identify obstacles up to 500 meters away, enhancing safety and efficiency.
• Sustainability Initiatives: In the coming years, the push for green locomotives will become more pronounced, with Indian Railways aiming for net-zero carbon emissions by 2030. Initiatives will include integrating hydrogen fuel cell technology, which will substantially reduce emissions. Additionally, solar-powered trains will be introduced, showcasing a commitment to sustainable and efficient rail transport solutions.