Metro Vehicles– Global Market Trends

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Annexe C2017

METRO VEHICLES– GLOBAL MARKET TRENDS

Forecast, Installed Base, Suppliers, Infrastructure and Rolling Stock Projects Extract from the study

METRO VEHICLES – GLOBAL MARKET TRENDS Forecast, Installed Base, Suppliers, Infrastructure and Rolling Stock Projects This study entitled “Metro Vehicles – Global Market Trends” provides comprehensive insight into the structure, fleets, volumes and development trends of the worldwide market for metro vehicles. Urbanisation, the increasing mobility of people and climate change are resulting in an increased demand for efficient and modern public transport systems. Metro transport represents such an environmentally friendly mode which has become increasingly important in the last few years. Based on current developments, this Multi Client Study delivers an analysis and well-founded estimate of the market for metro vehicles and network development. This is the sixth, updated edition of SCI Verkehr’s study analysing the global market for metro vehicles. All in all, the study provides a well-founded analysis of the worldwide market for metro vehicles. This study further provides complete, crucial and differentiated information on this vehicle segment which is important for the operational and strategic planning of players in the transport and railway industry. In concrete terms, this market study of metro vehicles includes: . A regionally differentiated look at the worldwide market for metro vehicles including an in-depth analysis of all important markets of the individual countries. Network length, installed base and average vehicle age in 2016 of all cities operating a metro system are provided . An overview of the most important drivers behind the procurement and refurbishment of metro vehicles in the individual regions . A comprehensive analysis of the current fleet stocks concerning quantities and age structures as well as future procurement potential up to 2022. An analysis of the current market shares of important manufacturers as well as a forecast of future vehicle requirements of customers up to 2022 . A worldwide presentation of metro systems, future infrastructure projects and forecast of network development up to 2030 . An overview of metro vehicle manufacturers including a brief description of their current range of products and services as well as production capacities . A condensed presentation of the most important fleet-specific features of metro vehicles of all countries presented in detail and regions in the form of diagrams . A list of all vehicle stocks of metro operators in the annexe to the study The market study is based on numerous sources of information from the press and discussions with experts, which are continuously analysed, evaluated and entered into the SCI Database. The study is available in English starting April 2017. SCI Verkehr GmbH is an independent consultancy company specialising in the technology and economics of transport. We have close connections to the rail industry, with consultants in a wide range of specialist fields. We have an extensive network of experts in Germany and abroad and we specialise in market and strategy aspects for the mobility sector. Our activities focus on companies in the transport and rail industry, logistics, public and private transport companies and transport and economics departments in public administration at federal, regional and municipal level Ann Kathrin Arntz Head of Marketing and Sales Phone: +49 221 93178 20 Fax: +49 221 93178 78 Email: [email protected]

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CONTENTS

1 Executive Summary: The World Market for Metro Vehicles Fehler! Textmarke nicht definiert.

2 Objective of the Study and Delimitation of the Railway MarketFehler! Textmarke nicht definiert. 2.1 Objective of the Market Analysis ...... Fehler! Textmarke nicht definiert. 2.2 Delimitation of the Rail Market...... Fehler! Textmarke nicht definiert.

3 Market Analysis Methodology ...... Fehler! Textmarke nicht definiert. 3.1 SCI Forecasting Tool ...... Fehler! Textmarke nicht definiert. 3.2 After-Sales Market Forecast ...... Fehler! Textmarke nicht definiert.

4 The Market for Metro Vehicles in Western Europe ...... Fehler! Textmarke nicht definiert. 4.1 Total Market ...... Fehler! Textmarke nicht definiert. 4.2 Germany ...... Fehler! Textmarke nicht definiert. 4.3 France ...... Fehler! Textmarke nicht definiert. 4.4 United Kingdom ...... Fehler! Textmarke nicht definiert. 4.5 Italy ...... Fehler! Textmarke nicht definiert. 4.6 Spain ...... Fehler! Textmarke nicht definiert.

5 The Market for Metro Vehicles in Eastern Europe ...... Fehler! Textmarke nicht definiert. 5.1 Total Market ...... Fehler! Textmarke nicht definiert. 5.2 Turkey ...... Fehler! Textmarke nicht definiert. 5.3 Czech Republic ...... Fehler! Textmarke nicht definiert.

6 The Market for Metro Vehicles in Asia ...... Fehler! Textmarke nicht definiert. 6.1 Total Market ...... Fehler! Textmarke nicht definiert. 6.2 China ...... Fehler! Textmarke nicht definiert. 6.3 India ...... Fehler! Textmarke nicht definiert. 6.4 Japan ...... Fehler! Textmarke nicht definiert. 6.5 South Korea ...... Fehler! Textmarke nicht definiert.

7 The Market for Metro Vehicles in North America ...... Fehler! Textmarke nicht definiert.

8 The Market for Metro Vehicles in South and Central AmericaFehler! Textmarke nicht definiert.

9 The Market for Metro Vehicles in the CIS...... Fehler! Textmarke nicht definiert.

10 The Market for Metro Vehicles in Africa/the Middle East ... Fehler! Textmarke nicht definiert.

11 The Market for Metro Vehicles in Australia/Pacific ...... Fehler! Textmarke nicht definiert.

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ANNEX

1 Annex A ...... Fehler! Textmarke nicht definiert.

2 Annex B: Factsheets of major metro vehicle manufacturersFehler! Textmarke nicht definiert.

3 Annex C: Overview of metro fleets ...... Fehler! Textmarke nicht definiert.

4 Annex D: Automated Guided Vehicles operating ...... Fehler! Textmarke nicht definiert.

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5. The Market for Metro Vehicles Asia

5.1 Total Market

Market Overview

Asia Metro Trend

Cars 2016 49.000

Average development 2016-2021 (p. a.) 11.4% 

Average age 2016 (in years) 9.5 Installed Installed Base

Average volume 2015-2017 (EUR million p. a.) 4.750

Average development 2016-2021 (p. a.) -0.2% 

Market Market For Volatility market volume 2016-2021 (SAW) 15.2% New New Vehicles

Average volume 2015-2017 (EUR million p. a.) 1.650

Average development 2016-2021 (p. a.) 7.8%  After Sales After Market Market For Volatility market volume 2016-2021 (SAW) 17.3%

 Boom/Strong Growth  Small Growth  Stagnation  Small Decrease  Clear Decline

Volume: > +5%p.a. +2 to +5% p.a. 0 to +2% p.a. -2 to 0% p.a. <-2% p.a.

Installed base: > +1.5%p.a. +0.5 to +1.5% p.a. -0.5 to +0.5% p.a. -1.5 to -0.5% p.a. <-1.5% p.a.

Figure 1: Market Overview in Asia

The Asian metro vehicle market will remain at a very high level, but will not grow further over next five years. Despite the fact that the market will not grow in medium-term, it remains the most important region of the world, as more than half of the world market size is currently made up by Asia.

Market environment/infrastructure development

Urban rail is a strong growth sector in Asia. Transport performance doubled between 2005 and 2012 and is expected to double again until 2020, reaching 434 billion pkm. While China and India showed constant growth, the Japanese and South Korean urban rail sectors suffered in 2008-2009. The largest regional markets are China, Japan and South Korea. More recently, India started to develop its urban rail systems and is expected to register the second highest growth rate after China.

[….]

New metro systems or lines are being planned and built in China and India as well as in Bangladesh, Indonesia, Malaysia, the Philippines, South Korea, Taiwan, Thailand and Vietnam. Japan already has efficient mass transit transport systems in its metropolises. As the new development of metro systems is very cost-intensive, many countries place a great deal of value on public-private partnership as a method of financing. In addition, it is worth mentioning that planned new development projects in countries that are financially weaker are often implemented with a time delay or fail to be implemented.

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1 Ahmedabad 50 Lanzhou 2 Bangalore 51 Luoyang 3 Bangkok 52 Ludhiana 4 Baotou 53 Macao 5 Beijing 54 Manila 29 6 Busan 55 Mumbai 87 8 7 Chandigarh 56 Nagoya 69 32 74 8 Changchun 57 Nagpur 4 9 Changsha 58 Nanchang 50 5 16 66 10 Changzhou 59 Nanjing 81 76 72 86 70 11 Chengdu 60 Nanning 84 94 35 96 12 Chennai 61 Nantong 38 67 71 15 85 48 56 41 92 6 42 13 Chongqing 62 Ningbo 51 97 26 95 93 21 63 14 Colombo 63 Osaka 10 47 15 Daegu 64 Patna / Danapur 59 90 61 11 89 30 73 16 Dalian 65 Pune 52 7 13 78 17 Delhi 66 Pyongyang 17 9 27 62 49 58 18 Dhaka 67 Qingdao 25 36 39 24 22 19 Dongguan 68 Quanzhou 64 46 18 68 80 20 Foshan 69 Sapporo 88 23 19 91 82 60 21 Fukuoka 70 Sendai 1 44 20 75 79 33 57 28 53 40 22 Fuzhou 71 Seo-gu Daejeon 83 23 Guangzhou 72 Seoul 65 55 24 Guiyang 73 Shanghai 25 Gurgaon 74 Shenyang 34 26 Gwangju 75 Shenzhen 54 27 Hangzhou 76 Shijazhuang 3 2 12 28 Hanoi 77 Singapore 29 Harbin 78 Suzhou 43 31 30 Hefei 79 Taichung 14 31 Ho Chi Minh City 80 Taipei 32 Hohhot 81 Taiyuan 33 Hong Kong 82 Taoyuan 34 Hyderabad 83 Thane 45 35 Incheon 84 Tianjin 77 36 Jaipur 85 Tokio 37 Jakarta 86 Uijeongbu 38 Jinan 87 Urumqi 39 Kanpur 88 Varanesi Metro systems in operation 40 Kaohsiung 89 Wuhan 37 41 Kawasaki 90 Wuxi 42 Kobe 91 Xiamen Metro systems in operation, expected to 43 Kochi 92 Xian expand by more than 5 km in the period 2017-2025 44 Kolkata 93 Xuzhou 45 Kuala Lumpur 94 Yantai 46 Kunming 95 Yokohama Complete new systems (Start of construction before 2025) 47 Kunshan 96 Yong-In 48 Kyoto 97 Zhengzhou © SCI Verkehr GmbH 49 Lakhnau Figure 2: Metro systems and new development and upgrade projects in Asia

The route network in Asia will grow at rapid speed. Even in the downside scenario, SCI Verkehr expects the network to more than double between 2016 and 2026. The downside scenario is based on the fact that the municipalities cannot implement their upgrade plans due to their relatively weak financial position (e.g. in countries such as Vietnam, Thailand and some Indian cities as well as financially weak Chinese municipalities).

Metro system in operation [km] Asia 20000 Forecast 18000 16000 14000 12000 10000 8000 6000 4000 2000 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Base Case Downside Case Upside Case © SCI Verkehr GmbH Figure 3: Metro network in operation – network development Asia

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Countries not among those considered in detail in this study have the following important current and planned infrastructure projects:

Expected Country City Project Title Distance in km Project status completion Bangladesh Dhaka Line 6 20.1 2024 Construction Indonesia Jakarta (1) North-South corridor phase 1 15.7 2018 Construction (Lebak Bulus - Bundaran Hl / city centre) [..] [..] [..] [..] [..] [..] © SCI Verkehr GmbH

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Installed base/age structure

With about xx operated metro cars, Asia has the largest fleet in the world. The fleet has grown considerably through procurements in China in the last few years. Japan and South Korea also have comprehensive installed bases in Tokyo and Seoul.

Installed Base [Number of cars] Asia

China South Korea Japan India Bestandsübersicht HGV-Züge Osteuropa 2008 (Anzahl Units) Singapore Taiwan Malaysia North Korea Thailand Philippines

0 5000 10000 15000 20000 25000 30000

Top 10 cities for metro:

Number of metro units/cars 2016 Route length Average age Rank Country City (rounded) in km 2016 2016 Units Cars 1 China Beijing xx xx 3 574 2 China Shanghai xx xx 16 637 3 South Korea Seoul xx xx 18 356 [..] [..] [..] [..] [..] [..] 10 Malaysia Kuala Lumpur xx xx 22 79 © SCI Verkehr GmbH

[…]

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The Asian fleet ,on average, is only 10 years old. Between 2012 and 2016, xx metro cars were delivered to Asian cities. In China alone, nearly xx metro cars were delivered between 2012 and 2016. Old fleet, which exceeds its economical efficient life time, is mainly operated in North and South Korea, Hong Kong and Japan.

Figure 5: Age structure

[…]

Manufacturers/Market Shares

In the last five years, the Asian market was dominated by CRRC from the leading Chinese market. After the merger of CSR and CNR, CRRC has more than 80% market share in this region. Besides China and countries in South East Asia, where Chinese players have traditionally a strong positioning, CRRC is increasing its market share in India. Within 2012- 2016, CRRC delivered to the following cities outside China: Kuala Lumpur, Lahore, Greater Noida, Singapore, Mumbai, Bangkok and for the Rapid Metro Rail Gurgaon in Delhi. CRRC has now 5 subsidiaries producing metro vehicles: Sifang, Zhuzhou, Nanjing Puzhen, Changchun and Dalian.

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Manufacturers' market share 2012-2016 [Number of Cars] Asia

Alstom Kawasaki 2% 2% BEML Others 2% 6% Bombardier 3% Hyundai Rotem 4%

CRRC 81%

In total: ~ 19 500 Cars

[…]

Market volume and market development

The current market volume for metro vehicles in Asia is around EUR xx million per year, for after-sales services, around EUR xx million.

This market development is influenced by the following drivers:

Driver Brief description Relevance Trend Asian cities have been heavily investing in new metro infrastructures since recent years, especially China, followed by New development and India and other countries. Investments will continue in the  upgrade of infrastructure medium-term at a very high level.

Fleet structure Requirements for replacing vehicles which have reached an age  of 30 to 45 years, mainly in Hong Kong, Japan and South Korea Stable economic situation in the important countries of China, India, Japan and South Korea. There is financial support by Investment funds  international organisations for the Asian countries that are financially weaker.

Transport demand Reduction of CO2 emissions as well as climate-friendly transport systems are of high political priority in the important countries of  Japan, South Korea and China. China in particular is becoming increasingly aware of its pollution problem. Environment and Increasing numbers of metropolitan areas and more traffic jams sustainability on the roads will increase the transport demand in the  metropolises. Many cities with more than 1 million inhabitants still have no mass transport system.

Relevance for procurements: = very high, = high, = medium, = low, = none 5-year trend:  = strongly increasing,  = increasing,  = constant,  = decreasing  = strongly decreasing © SCI Verkehr GmbH

[…]

The following chapters specifically include the important current and future vehicle procurements of the countries considered in detail.

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[…]

Countries not among those considered in detail in this study have the following important current and planned procurement projects:

Country/ city Units Cars Vehicle type/line Delivery Comment

A tender to pre-qualify bidders for a contract to supply 24 six-car metros was published on 31st January 2015. The estimated cost of the procurement has to be approved by the Dhaka Metro Rail authority and Japan International Cooperative Agency (Jica) which is helping Bangladesh / New system first 24 6 2019-2024 in funding the project. Construction works on the first Dhaka line metro line linking Uttara, Agargaon, Farmgate and Motijheel have started in December 2015. Completion of the first section from Uttara to Agargaon is scheduled for December 2019 while the entire project should be completed by 2024. Kawasaki Heavy Industries signed a contract jointly with Alstom Transport and CTCI Corporation of Taiwan to provide the Department of Rapid Transit Systems, Taipei Green line, City Government (DORTS) with a railway system for the Taiwan / 36 2 medium capacity 2015-2017 Taichung City Government. The contract is valued at Taichung transit (MCT) around EUR 330 million (TWD 10.9 billion), with design and construction of the electrical and mechanical system package scheduled for completion by October 2017. [..] [..] [..] [..] [..] [..] [..] [..] [..] [..] [..] © SCI Verkehr GmbH

[..]

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Annexe B

Vehicle Delivery Delivery Main Region Country Operator City Cars type / Line from to supplier Beijing Type DK16, Asia China Beijing 168 1986 1989 CNR Subway Line 2 Beijing Type DKZ4, Asia China Beijing 186 1995 1999 CNR Subway Line 1 Type DK32- Beijing 34, Line 13 Asia China Beijing 240 2005 2007 CNR Subway (Airport Line) Beijing Type ART Bombardi Asia China Beijing 40 2006 2007 Subway MK II er Lines 1 and Beijing Asia China Beijing 4 (Daxing 318 2006 2009 CSR Subway Line) Lines 1, Beijing 8,10, 15, Asia China Beijing 914 2006 2012 CNR Subway Fanshan Line Beijing Asia China Beijing Line 5 204 2007 2008 CNR Subway Beijing Type Metro- Asia China Beijing 84 2007 2008 Alstom Subway polis Beijing Type B, Line Asia China Beijing 288 2009 2012 CSR Subway 2 Beijing Changpin Asia China Beijing 162 2009 2011 CSR Subway Line Beijing Line 15, Asia China Beijing 180 2009 2010 CNR Subway Phase 1 Type B, Yiz- Beijing huang Line, Asia China Beijing 528 2010 2013 CNR Subway Lines 9 and 10 Beijing Type B, Line Asia China Beijing 512 2011 2012 CNR Subway 6, Phase 1 Beijing Asia China Beijing Line 8 198 2011 2013 CSR Subway Beijing Asia China Beijing Line 5 132 2011 2012 CNR Subway Beijing Asia China Beijing Line 1 114 2011 2011 CSR Subway ……………..

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Annexe C

Hyundai Rotem

Overview

Head Office: 37 Cheoldobakmulgwan-ro, Uiwang-si, Gyeonggi-do, South Korea Website: www.hyundai-rotem.co.kr Shareholders: 43.4% Hyundai Motors, 24.8% Morgan Stanley (MSPE Metro-Investment AB), 31.8% others Management: Kim Seung-Tack (CEO) Employees (2015): 3 800 Turnover (2015): EUR 2.6 billion (KRW 3 309 billion) Profit (2015): EUR -244 million (KRW -304 billion; net profit) Hyundai Rotem is one of East Asia’s main rolling stock manufacturers. Rotem became part of Hyundai Motor Group (HMG) in 2001. With regard to its rolling stock activities, the company produces a wide range of rolling stock including high-speed rail (KTX) and seeks turnkey E&M (Electrical & Mechanical) projects that include relevant electrical equipment and signal systems. Hyundai Rotem is the largest rail industry company in the South Korean market and is represented in all vehicle segments. It also manufactures magnetically levitated vehicles (MAGLEVs). Hyundai Rotem generates around 45% of its total sales (2015) by supplying rolling stock and related services. Other activities are the defence as well as the plant & machinery business. [….] Facilities and co-operations

Hyundai Rotem owns sites in South Korea, Turkey, USA, and Brazil. Hyundai consolidates its rolling stock production at the Changwon site and manufactures EMUs and passenger coaches for the American commuter transport market at its US site. Its newly established site in Brazil assembles EMUs and metros. – In March 2016, Hyundai Rotem has completed the construction of its rolling stock assembly plant in Araraquara, Brazil. The facility with an area of 150,000 m2 is Hyundai Rotem’s third factory outside Korea. It will produce 30 eight-car EMU’s ordered by suburban operator CPTM in 2013 for EUR 197.3 million (BRL 788 million), as well as 136 metro cars for Salvador. – [….]

Sites of final assembly for metro vehicles Country Site Products Remarks E-loco, D-loco, HST, EMU, Production capacity: 800 cars and Korea Changwon DMU, Metro, PC, LRV, locomotives p.a.

engineering Employees: ~1000 EURotem Joint Venture with TCDD EMU, Metro, LRV, PC, Production capacity: 100 cars p.a., Turkey Adapazari HST, E-loco 50 locomotives p.a. Employees: ~ 150 Production capacity: 200 p.a Brazil Araraquara EMU, Metro, LRV Employees: 200, target: 300 Product segments

Important Market shares Segment Market positioning products (2012–2016) 100% (South Korea) 40% (India) Metro - 10% (SA) [….] 4% (AS) 4% (EE) 4% (WW) © SCI Verkehr GmbH

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