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The light rail market size is forecast to increase by USD 3.74 billion at a CAGR of 4.1% between 2023 and 2028. The market is experiencing significant growth, driven by the rapid expansion of urban areas and increasing investment from governments to improve public transportation infrastructure. This trend is particularly evident in densely populated cities where traffic congestion and environmental concerns are becoming major issues. However, the market is not without challenges. The volatility in prices of raw materials, such as steel and aluminum, poses a significant threat to the cost-effectiveness of light rail projects. Additionally, the high upfront costs of constructing light rail systems can be a barrier to entry for some potential investors. Despite these challenges, the long-term benefits of light rail, including reduced traffic congestion, improved air quality, and increased mobility, make it an attractive option for urban transportation solutions.
The Light Rail Market is a significant segment of the public transport industry, providing energy-efficient solutions to traffic congestion in urban areas. The market encompasses the manufacturing, refurbishment, and maintenance of Light Rail Vehicles (LRVs), including rolling stock components such as pantographs, axles, wheelsets, and traction motors. Industrial and mining activities contribute to the demand for LRVs in transporting raw materials. The Light Rail Market caters to both lower and higher capacity systems, with applications ranging from inner city transportation to interconnecting cities.
Further, LRVs offer sustainable transportation options, reducing carbon emissions and promoting urban transportation through dedicated tracks. The market includes passenger information systems and air conditioning systems for enhanced comfort. Metro systems and heavy rail systems are distinct from light rail systems, with metro systems typically having higher capacity and heavier vehicles operating on dedicated subway tracks. The Light Rail Market is expected to grow as the demand for shared mobility and electrification of transportation services continues to increase. Urban transportation trends emphasize the importance of lowering carbon emissions and improving passenger experience, making the Light Rail Market an influential player in the transportation industry.
The market report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD billion " for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.
The High capacity light rail segment is estimated to witness significant growth during the forecast period. The Light Rail Market plays a significant role in addressing traffic congestion in urban areas by providing energy-efficient public transport solutions. Refurbishment of rolling stock is a key trend in this market, ensuring industrial and mining activities continue uninterrupted while promoting sustainable transportation. Light rail vehicles, including locomotives, wagons, and coaches, are integral to rapid transit systems, offering passenger and freight transportation on dedicated tracks.
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The High capacity light rail segment accounted for USD 8.46 billion in 2018. Electrification of light rail systems, through pantographs and traction motors, reduces carbon emissions, making it a preferred choice for urban transportation. The integration of passenger information systems and air conditioning systems enhances the passenger experience. Smart technologies, such as mobile ticketing, real-time information, IoT sensors, automatic collision avoidance, and video surveillance, further improve the efficiency and safety of these systems. Metro systems and heavy rail systems are major contributors to the Light Rail Market, offering rapid and sustainable mobility solutions. The market's growth is driven by the increasing demand for smart transportation services and the integration of advanced technologies to cater to the evolving needs of passengers. Overall, the Light Rail Market is a crucial component of the public transportation sector, offering energy-efficient, sustainable, and technologically advanced transportation solutions.
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Europe is estimated to contribute 52% to the growth of the global market during the market forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
The Light Rail market caters to the demand for transportation in both inner city and interconnecting cities. This mode of rail supply offers two primary capacity options: lower capacity for densely populated inner city areas and higher capacity for longer distance routes. A notable trend in the market is the shift towards low-floor light rail systems, which provide easier accessibility for passengers and enhance user experience. High-floor systems, while still in use, are gradually being phased out due to their limited accessibility. The demand for transportation solutions that efficiently move large numbers of people in urban areas continues to drive the growth of the light rail market.
Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The rapid growth of urban areas is notably driving market growth. The global light rail market is experiencing significant growth due to the increasing demand for energy-efficient and sustainable public transport solutions in response to urbanization and traffic congestion. Light rail systems offer an effective alternative to traditional buses and heavy rail systems, providing higher capacity and reduced disruption to urban areas. These systems contribute to the reduction of carbon emissions, improving urban mobility and air quality. The trend towards urban densification and the preference for car-free or car-lite lifestyles among young professionals and families further bolsters the demand for comprehensive public transportation networks.
Also, light rail vehicles, consisting of locomotives, wagons, coaches, and rolling stock such as pantographs, axles, wheelsets, traction motors, and passenger information systems, are being increasingly adopted for urban transportation. Advanced technologies, including air conditioning systems, passenger information systems, mobile ticketing, real-time information, IoT sensors, automatic collision avoidance, and video surveillance, are being integrated into light rail vehicles to enhance the passenger experience and promote smart, sustainable mobility. Light rail systems can be integrated with metro systems and dedicated tracks, making them a versatile and efficient solution for both passenger and freight transportation. Thus, such factors are driving the growth of the market during the forecast period..
The high investment by governments in light rail is the key trend in the market. The Light Rail Market is experiencing significant growth due to increasing investment from governments worldwide in response to urban population growth and traffic congestion. Light rail systems offer an energy-efficient and sustainable public transport solution, reducing carbon emissions and improving urban transportation. In May 2023, the Biden-Harris administration allocated over USD 700 million in grants to refurbish aging passenger railcars and develop new light rail systems in the US.
Further, this investment not only expands existing networks but also fuels the demand for new rolling stock, infrastructure, and associated technologies. Industrial and mining activities, as well as freight transportation, can benefit from the use of light rail vehicles for more efficient and sustainable mobility. Light rail vehicles, including locomotives, wagons, coaches, and passenger transportation systems, are essential components of rapid transit and urban transportation systems. The electrification of these systems, along with the integration of passenger information and air conditioning systems, further contributes to the market's growth. Overall, the Light Rail Market is poised for continued expansion as governments and industries prioritize sustainable transportation solutions. Thus, such trends will shape the growth of the market during the forecast period.
The volatility in prices of raw materials is the major challenge that affects the growth of the market. The global market plays a significant role in public transportation, offering energy-efficient solutions to traffic congestion in urban areas. This market encompasses the production and refurbishment of rolling stock, including light rail vehicles, pantographs, axles, wheelsets, traction motors, passenger information systems, and air conditioning systems. Industrial and mining activities also contribute to the demand for light rail vehicles in freight transportation. Light rail systems, including rapid transit, wagons, coaches, and passenger transportation services, are increasingly popular due to their sustainability and reduction of carbon emissions.
Additionally, these systems utilize dedicated tracks and can be integrated with smart technologies such as mobile ticketing, real-time information, IoT sensors, automatic collision avoidance, and video surveillance. However, the market growth of light rail systems can be influenced by the volatility of raw material prices, particularly those of steel, aluminum, and cast iron. Fluctuations in these prices can increase production costs and ultimately impact consumer prices. The prices of these commodities are influenced by market demand and supply, currency fluctuations, and geopolitical tensions. Despite these challenges, the future of the light rail market looks promising with the increasing focus on sustainable transportation and the electrification of transportation services. Hence, the above factors will impede the growth of the market during the forecast period.
The market forecasting report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
ALSTOM SA - The company offers light rail systems and solutions such as Low-floor, Battery-powered SWIMO-Kawasaki Rail Car and others.
The market research and growth report also includes detailed analyses of the competitive landscape of the market and information about key companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market is witnessing significant growth due to the increasing demand for energy-efficient transport solutions in urban areas. Public transportation, a vital component of sustainable mobility, is becoming increasingly important as traffic congestion continues to be a major challenge in metros and cities worldwide. Light rail vehicles (LRVs), a key part of the Light Rail Market, offer a viable alternative to traditional automobiles. These vehicles run on dedicated tracks and provide rapid transit services, making them an attractive option for passenger transportation. Refurbishment of existing rolling stock and the purchase of new LRVs, including wagons, coaches, and locomotives, are driving the Light Rail Market. Industrial and mining activities also contribute to the demand for light rail transport due to their heavy freight requirements. The Light Rail Market is witnessing the integration of smart technologies such as passenger information systems, air conditioning systems, mobile ticketing, real-time information, IoT sensors, automatic collision avoidance, and video surveillance. These advancements aim to enhance the passenger experience and promote sustainable transportation with minimal carbon emissions. The Light Rail Market includes various components such as pantographs, axles, wheelsets, traction motors, and passenger transportation and freight transportation systems. The market caters to both urban transportation needs, including metro systems and heavy rail systems, making it a versatile and essential part of the transportation industry.
Market Scope |
|
Report Coverage |
Details |
Page number |
205 |
Base year |
2023 |
Historic period |
2018 - 2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 4.1% |
Market growth 2024-2028 |
USD 3.74 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
3.76 |
Regional analysis |
Europe, APAC, North America, Middle East and Africa, and South America |
Performing market contribution |
Europe at 52% |
Key countries |
US, China, Germany, France, Italy, UK, Canada, Japan, South Korea, and Australia |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
ALSTOM SA, CRRC Corp. Ltd., General Electric Co., Hitachi Ltd., Hyundai Heavy Industries Group, Kawasaki Heavy Industries Ltd., Kintetsu Group Holdings Co. Ltd., Knorr Bremse AG, Mitsubishi Heavy Industries Ltd., Mott MacDonald, Parsons Corp., Pesa Group, Samvardhana Motherson International Ltd., Schunk GmbH, Siemens AG, Stadler Rail Ag, SYSTRA SA, Thales Group, WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORP., and WSP Global Inc. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Technavio Analysis
3 Market Landscape
4 Market Sizing
5 Historic Market Size
6 Qualitative Analysis
7 Five Forces Analysis
8 Market Segmentation by Type
9 Market Segmentation by Application
10 Customer Landscape
11 Geographic Landscape
12 Drivers, Challenges, and Opportunity/Restraints
13 Competitive Landscape
14 Competitive Analysis
15 Appendix
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