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The North America railcar leasing market is projected to reach a value of USD 6.11 billion with a CAGR of 7.42% between 2023 and 2028. The surge in demand for tank cars is propelled by the escalating crude oil production, necessitating efficient transportation to refineries and distribution hubs. Market growth is further fueled by the railway network's expansion, which augments transportation routes and capacity for various goods, notably crude oil. Moreover, the cost efficiencies associated with railcar leasing, encompassing reduced upfront expenditures and enhanced fleet management flexibility, are amplifying the appeal of rail transportation for enterprises. These factors collectively bolster the demand for tank cars, positioning rail transport as a preferred choice for businesses seeking reliable and cost-effective freight solutions in the transportation industry.
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The petroleum and chemical segment is estimated to witness significant growth during the forecast period. The oil and gas industry is one of the major contributing sectors to the market in North America. The US shale has planned to increase the investment by 20% in 2022 compared with 2021, from USD 69.8 billion in 2021 to USD 83.4 billion. Therefore, such investments in oil and gas projects will drive the demand for tank cars. Hence, such factors will drive the market.
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The petroleum and chemical segment was the largest segment and valued at USD 3.49 billion. Investments in the chemical industry will increase due to factors such as favourable government and environmental regulations and increased chemical production capacities. For instance, in January 2018, NOVA Chemicals announced that they would invest in USD2 billion projects with the Government of Canada funding in Ontario and Alberta. Consequently, with the rise in investments in the chemical industry, the demand for railcars for the transportation of chemicals will increase, thereby driving the market during the forecast period.
The market plays a crucial role in the logistics industry, offering a cost-effective and efficient means of transporting various goods and commodities. With the global demand for freight transport increasing, especially in emerging economies, the need for railcar leasing services is growing. Railcars are used for transporting a wide range of products, including petrochemicals, gases, cargo, food products, and pharmaceutical products. Companies in the oil & gas, chemical products, energy and coal, steel & mining, and food & agriculture sectors rely on railcar leasing for their transportation needs. 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.
Increasing demand for tank cars due to growing crude oil production is the key factor driving market growth. Tank cars are primarily used for transporting crude oil and gasoline products. The production of crude oil has increased in North America, particularly in the US, in the last six years due to rising automotive sales and new oil exploration projects in the region. This trend extends to the transportation of other petrochemicals, gases, and cargo using railcars, coaches, and other forms of railcar leasing. The demand for such services is also increasing in emerging economies, reflecting a growing need for efficient transportation of goods and services.
Moreover, the increased production of crude oil is expected to lead to a significant rise in the production of refined products such as gasoline. This increase in the production of flammable products has significantly boosted the demand for tank cars in North America in recent years, as well as for freight cars used in transporting oil & gas, chemical products, energy and coal, steel & mining, and food & agriculture. Additionally, many crude oil manufacturers prefer leasing railcars for transporting crude oil instead of purchasing new ones, which is expected to drive the demand for railcar leasing in the forecast period.
The application of advanced coatings on railcars is the primary trend shaping market growth. Railcars are highly prone to wear and tear owing to long-term usage. Various types of coatings are used to eliminate such damage, such as sulfuric acid, epoxy coatings, and phenolic coatings. The coatings that are used on these railcars should be certified by the Food and Drug Administration (FDA) and the National Science Foundation (NSF).
Furthermore, normal coatings are not possible in tank cars, owing to their cylindrical shape leading to uneven coatings. In such cases, high solid coatings are used to protect the railcars from volatile organic compounds and hazardous air pollutants. Consequently, the application of advanced coatings can increase their lifespan, thereby driving the market.
The risks associated with railcar leasing are major challenges impeding market growth. With the technological upgradation in the market, new and more efficient upgraded versions of railcars are being introduced in the market, which will outdate the older version of railcar after the lease period. Additionally, the residual value of the railcar reduces proportionally with the number of times the railcar is being leased. The railcars that have been used for a longer duration will have less market value for leasing compared with the new ones launched in the market each year.
Furthermore, the tank cars that have been used for the transportation of chemicals, crude oil, and petroleum products will have severe damage, which reduces the value of the railcar, as well as incurs huge losses for the leasers, along with other maintenance costs. Thus, the risks associated with railcar leasing can hinder the market's growth during the forecast period.
The market research 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 includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
North America Railcar Leasing Market 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.
Berkshire Hathaway Inc.: The company offers railcar leasing under the brand, Marmon Group.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market 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 research report provides comprehensive data, with forecasts and estimates in "USD Billion" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments
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?????The Global Railcar Leasing Service Market is influenced by various factors such as Railroads, Tax, and Insurance. Research methodology plays a crucial role in understanding the Global freight traffic and the demand for Seafood transportation. Temperature-controlled container, IoT Internet of Things and IoT-enabled Monitoring systems ensure the safety of goods. Digital freight trains and Telematics improve efficiency, while Government spending drives infrastructure projects. Railway Operators and Logistics Companies face Competitive Rivalry and the Threat of Substitution. Supplier Bargaining Power and Buyer Bargaining Power impact the Railcar Leasing sector, which constantly seeks Innovations for growth.
Further, the market is a dynamic sector influenced by various factors. The International Monetary Fund (IMF) and the World Economic Forum (WEF) impact global economic trends, while Environmental concerns drive sustainable practices. Efficiency of rail networks is crucial for Aggregates & Construction and Petrochemical transportation. Companies like SMBC (ARI), BRUNSWICK Rail, and Mitsui Rail Capital play key roles in leasing Freight wagons and Tank and freight cars. Passenger coaches and Box cars are also part of the market, facing challenges such as the Threat of New Entry and the need for Carriage strategies. Industry players rely on Cutting Edge technologies and insights from Secondary research sources like Annual reports and SEC filings to make informed decisions.
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Market Scope |
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Report Coverage |
Details |
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Page number |
154 |
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Base year |
2023 |
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Historic period |
2018-2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 7.42% |
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Market Growth 2024-2028 |
USD 6.11 billion |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
6.96 |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
American Industrial Transport Inc., Arrendadora Nacional de Carros de Ferrocarril S.A. de C.V., Berkshire Hathaway Inc., Everest Railcar Services Inc., First Citizens Bancshares Inc., GATX Corp., GLNX Corp., Herzog Contracting Corp., HiRail Leasing, MITSUI and CO. LTD., Nucor Corp., PFL Petroleum Services LTD., RESIDCO, RTEX Rail, Sasser Family Companies, Stonebriar Commercial Finance, Sumitomo Mitsui Financial Group., Trinity Industries Inc., Wells Fargo and Co., and VTG GmbH |
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Market dynamics |
Parent market analysis, Market Forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the market forecast period. |
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Customization purview |
If our market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by End-user
7 Market Segmentation by Product
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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