The primary factor driving up demand for railcar leasing is the emergence of sensor-integrated railcars with access to a variety of sophisticated tracking and real-time monitoring services. Important railcar lessors are incorporating these services into bundle service offerings.
In recent years, the majority of railway cars have been leased in Asia Pacific. This is a result of expanding urbanisation and industrial goods movement within the developing Asia Pacific economy. Leasing railcars and railroads both play a significant part in the delivery of commodities.
Additionally, increasing cargo volume and size has increased the demand for rail freight transportation, and more especially, railcar leasing. Through integrated sensors and tracking platforms set up for the purpose, this not only enables the safe movement of kilogrammes of volume, but it also offers a reliable method of tracking real-time data of the rented railcars.
Railcar leasing is expected to surpass US$ 14.2 billion in 2020 as a result of these reasons, and the industry is expected to grow at a CAGR of more than 9% through 2030.
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Why are Future Projections Even Better than Historical Trends?
The global railcar leasing business grew at an astounding 8% annual rate from 2015 to 2019. This industry is anticipated to have amazing growth possibilities between 2020 and 2030. This is explained by the fact that industrialization is expanding in most high-potential regions worldwide.
Railway networks have historically been one of the most dependable means of transport for moving industrial and automotive items from one place to another. Regional market expansion is being aided by the steadily expanding industrial sectors, particularly in developing nations, and by the availability of an established rail infrastructure.
Ten years ago, a typical goods train cost less than $50,000 USD. It currently ranges from $100,000 to $150,000 USD. The majority of consumers are increasingly choosing railcar leasing over buying a more modern railcar because of this.
Additionally, railcars are used in a variety of end-use markets, which is the main factor contributing to the industry’s compounding rise in railcar leasing. In addition to this, numerous studies and partnerships being conducted by numerous important players to create railcars with improved performance further help the market flourish.
For instance, VTG started testing its wagons developed under project m2 in collaboration with DB Cargo. These newly developed wagons utilize 3-6% lesser traction energy, produce 3-8dB lesser noise, and are incorporated with various digital enhancements.
Similarly, key railcar lessors are adopting intuitive strategies so as to capitalize on growing rail transport requirements in high-potential regions. Owing to these broad factors, railcar leasing demand is likely to increase substantially, expanding at a CAGR exceeding 9% throughout the 2020-2030 assessment period.
Why is Railcar Leasing Beneficial in the Long Run?
The most important factor for a shipper leasing its own railcars is greater control of the supply chain. Further, shippers are not subject to supply and demand difficulties of other users of the same railway type in case of railcar leasing.
Shippers manage transport capacity directly through the relation between their car fleet and production lines. Furthermore, demurrage costs are reduced to a greater extent when the lessor and asset management agency properly maintain a record of the leasing timeline and manage the railcars efficiently.
Moreover, private railcars sometimes act as storage units when the receiver is unable to handle delivery or facilitate the timely unloading of goods. However, it must be noted that, railcar leasing is a relatively long-term commitment, and is subjected to various regulations (generally extended for 30 years or more).
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Key Segments Covered
Railcar Type
• Hopper Cars
• Boxcars
• Tank Cars
• Flat Cars
• Gondolas
• Intermodal
• Refrigerated Box Cars
• Other Railcars
End Use
• Agri-produce, Forestry and F&B Products
• Mining Products
• Petrochemicals & Gases
• Automotive & Components
• Energy Equipment & Products
• Rail Products
• Industrial Goods
• Construction Goods
Region
• North America
• Latin America
• Europe
• Asia Pacific
• Middle East & Africa
Competitive Landscape
Aforementioned players rely on a blend of organic and inorganic strategies to deepen penetration across lucrative markets. These strategies include product launches, collaborations with key players, partnerships, acquisitions, and strengthening of regional and global distribution networks.
• For instance, GATX, in 2020, announced the acquisition of Trifleet Holdings. This will give it access to 18,000 railcar containers worldwide, leased to customers in the gas, food, cryogenic, and pharmaceutical sectors. Further, GATX has also spent in expanding its maintenance facilities in Ware County, in 2018, which is planned to be completed in two phases.
• VTG, in 2020, partnered with Nexxiot to utilize its temperature sensors in its wagons, and provide real-time monitoring of its high-value temperature-sensitive goods. Moreover, VTG acquired the operations of Slovakia’s Carbo rail in 2020, by obtaining a majority stake in the company, which was aimed towards improving its operational capability in the European market.
Similar recent developments related to companies operating in the railcar leasing market have been tracked by the team at Fact.MR, which is available in the full report.
Report Benefits & Key Questions Answered
- Railcar Leasing Company & brand share analysis: The report offers in-depth Railcar Leasing brand share analysis to estimate percentage of the market covered by Tier 1, Tier 2, and Tier 3 companies
- Railcar Leasing Historical volume analysis: The report offers a comparative analysis between historic sales of Railcar Leasing and projected sales performance for 2021-2031
- Railcar Leasing Category & segment level analysis: Fact MR presents a comprehensive analysis of factors enabling sales growth across key segments. It underscores chief growth drivers and offers valuable information to identify sales prospects a local and regional levels
- Railcar Leasing Consumption by demographics: To offer informed recommendation, the report studies behavior and consumption pattern of consumers. The demographics analysis is intended at helping business better understand consumer preference and design their product and market strategies around it
- Post COVID consumer spending on Railcar Leasing: The Fact MR market survey carefully studies consumer spending behavior post COVID-19. It gauges how prevailing trends have influenced their behavior, subsequently impacting their spending power
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