The global smart railway market is projected to grow at a modest CAGR of 4.5% during the forecast period.  The smart railway market’s primary factor is growing digitization and urbanization in emerging economies such as India and China, among others. Further, the growing application of technology in the travel and tourism industry is another factor that is contributing to the growth of the smart railway market.

Apart from this, the growing digitalization and contactless transfer due to COVID-19 are further encouraging companies to invest in the smart ticketing solution which is contributing to the growth of the smart railways market. For an instance, in March 2021, Giesecke+Devrient (G+D) collaborated with IDEMIA and NXP Semiconductors. Together, the companies introduced the White Label Alliance (WLA) which responded to the increasing global demand for next-generation, discrete payment solutions for domestic and private-label payment brands. WLA embeds and updates an open and complete payment standard that allows ready-to-deploy dual interface payment solutions including contact and contactless payment cards, mobile devices, and payment terminal acceptance. In addition, in May 2019, Hitachi signed an agreement with Trentino Trasporti, a provider of public transportation in several municipalities in Trentino, Italy. The agreement was aim to carry out the Proof of Concept (POC) of the latest digital railway solution for the public transportation managed by Trentino Trasporti including Trento-Malé-Mezzana Railway and buses in the vicinity of Trento, Italy. This latest digital railway solution was developed to utilize smartphones as tickets by using the Hitachi group’s experience with railway solutions and digital technology.

Impact of COVID-19 Pandemic on Global Smart Railway Market

The COVID-19 pandemic has severely impacted the global smart railway market. During the pandemic, the companies strategically invested in the production of the smart railway. However, due to travel restrictions and lockdown imposed by the central government, the transportation sector had been hit hard by the pandemic. With the relaxation of lockdown restrictions and following social norms, the occupancy in trains is quite low. 

Segmental Outlook

The global smart railway market is segmented based on solutions. Based on solutions, the market is segmented into rail analytics systems, railway communication and networking systems, freight information systems, smart ticketing systems, advanced security monitoring systems, and others (passenger information systems). Among these, the railway communication and networking system segment is expected to have a considerable share in the market during the forecast period. The attributable factor for the growth of the segment is the growing digitization in railway services for enhancing the travel experience of passengers. 

Global Smart Railway Market Share by Solutions, 2021 (%)

Smart Ticketing Segment to Hold a Significant Share in the Global Smart Railway Market

The smart ticketing segment is expected to have a considerable share in the market during the forecast period. The attributable factor for the growth of the segment is that smart railway solutions enable travelers to book their tickets in advance and buy store and confirm tickets with contactless debit cards and credit cards.  Further, the companies are investing in the payment of contactless transfers. For instance, in November 2019, Confidex signed an agreement with the Roads and Transport Authority of Dubai. Under this agreement, Confidex supplied limited use contactless smart tickets to the metro. The Roads and Transport Authority of Dubai holds mass transit traffic traveling with reusable, durable, contactless railway solutions. Confidex demonstrated its capability to offer a fan-folded ticket that has high-temperature resistance at 100% humidity.

Regional Outlook

Geographically, the global smart railway market is segmented into North America, Europe, Asia-Pacific, and the Rest of the World. The Asia-Pacific region is expected to cater to a significant CAGR over the forecast period. China, India, Japan, and the Rest of the Asia-Pacific are the major economies that are primarily contributing to the growth of the smart railway market in the region. The rising disposable income in these economies coupled with growing population and urbanization is the primary factor that is propelling the market growth. 

Global Smart Railway Market Growth, by region 2022-2028

Asia-Pacific is Projected to Represent Highest Growth in the Global Smart Railway Market

Asia- Pacific is anticipated to exhibit the highest growth in the global smart railway market. The growth factors for the regional market include the growing population and urbanization in countries such as India and China. Further, the government initiatives of demonetization and making cashless transactions are another factors propelling the growth of the market. For an instance, the Indian government launched digital India initiative back in July 2015, to convert India into a cashless society. As per the International Union of Railways, Asia-Pacific accounted for 28% of the total railways' network in terms of length of lines. This share is majorly represented by China and India with 100,000 km and 65,000 km networks. The regional governments are focusing on up-gradation and revamping the existing lines, to enhance the overall efficiency of their operations.

Market Players Outlook

The prominent players functioning in the global smart railway market include Siemens AG, Thales Group S.A., Cisco Systems Inc., and Infineon Technologies AG among others. These key manufacturers are adopting various strategies such as new product launches and approvals, mergers and acquisitions, partnerships, collaborations, and many others to thrive in a competitive environment. For an instance, in May 2021, Siemens acquired Padam Mobility which is a technology company that provides AI-powered platforms and applications for on-demand and paratransit services. The acquisition is intended to enhance Siemens Mobility’s intelligent infrastructure portfolio focused on intermodal transportation. 

The Report Covers

• Market value data analysis of 2021 and forecast to 2028.
• Annualized market revenues ($ million) for each market segment.
• Country-wise analysis of major geographical regions.
• Key companies operating in the global smart railway market. Based on the availability of data, information related to pipeline products, and relevant news is also available in the report.
• Analysis of business strategies by identifying the key market segments positioned for strong growth in the future.
• Analysis of market-entry and market expansion strategies.
• Competitive strategies by identifying ‘who-stands-where in the market.