Overview of Global Railway Business in Q4 2020
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IEC INTERNATIONAL GLOBAL RAILWAY BUSINESS OVERVIEW OF MAJOR RAIL EVENTS IV QUARTER 2020 IEC International | Global railway business overview | Q4 2020 EXECUTIVE SUMMARY BUSINESS HEALTH Q4 showed a relatively low level of activity, as previously Q3. Digital and technological have been blooming, 01 however they mainly refer to levels of companies or countries and no to large-scale cooperative and integration solutions. INVESTMENTS AND FINANCING increase in total value of announced projects thanks to large programmes in EU countries 02 € 37 bn in Q4 (€ 9 bn in Q3, € 18 bn in Q2, € 281 in Q1). COVID-19 IMPACT Q4 was similar to Q3 in term of pandemic-related initiatives and support measures. In EU area the initiatives are mainly linked to 2021 Year of Railway. No drastic review of national or international strategies has benn 03 proposed by key market players, apart from changes in specific passenger services. Q4 = 4 QUARTER 2020 2 IEC International | Global railway business overview | Q4 2020 CONTENTS SCOPE OF OVERVIEW GEOGRAPHY OF GLOBAL RAILWAY BUSINESS IN Q4 2020 RAIL INVESTMENTS AND FINANCING BUSINESS STRATEGIES, M&A INTERNATIONAL INITIATIVES AND PARTNERSHIPS RAIL PERSONS RAILWAY SECTORS 3 IEC International | Global railway business overview | Q4 2020 SCOPE OF OVERVIEW Investments Strategies Major international and national investments. International and national initiatives. Financing from development banks Corporate strategies of railway companies. supranational organizations. Private Business development via M&A or new investments of rail companies. subsidiaries. Technologies Passenger New technologies and digital solutions for High speed, long-haul and suburban railway railways. Cooperation with non-rail passenger transportation. Services, routes technological companies. Innovations. and contracts. Station management. Construction Urban Construction, modernization and upgrade of Development of urban transportation: rail, rail infrastructure classified by cycles of metro, tram. project. Rolling stock Freight Rolling stock production and procurement. Railway freight transportation development. Passenger, freight and urban transportation News from logistics hubs. needs. SOURCES: 1. RAIL SECTOR MEDIA. 2. OFFICIAL INTERNET SITES OF RAILWAY COMPANIES AND ORGANIZATIONS. FOR Q3 MORE THAN 190 KEY EVENTS ARE CONSIDERED. THIS IS YET A NON-EXHAUSTIVE LIST. FOR ADDITIONAL INFORMATION AND DETAILED ANALYSIS YOU MAY CONTACT IEC TEAM. 4 IEC International | Global railway business overview | Q4 2020 GEOGRAPHY OF GLOBAL RAILWAY BUSINESS 2020 Q4. TYPES OF BUSINESS PROJECTS. EU, NORWAY, SWITZERLAND, UK EASTERN EUROPE** EASTERN ASIA SOUTHERN ASIA NORTHERN AMERICA NORTHERN AFRICA WESTERN ASIA SOUTHEASTERN ASIA SOUTHERN EUROPE CENTRAL AMERICA WESTERN AFRICA SOUTH AMERICA AUSTRALIA AND NEW ZEALAND SOUTHERN AFRICA INVESTMENTS NEW URBAN FREIGHT AND FINANCING TECHNOLOGIES TRANSPORT TRANSPORT CANCELLATION OF PROJECTS DUE TO COVID-19 **including Russia, all countries considered as by UN Geoscheme, except for EU BUSINESS CONSTRUCTION, PASSENGER ROLLING / TEMPORARY SERVICES FOR first symbol represents dominant types of activities, others in random order DEVELOPMENT UPGRADE TRANSPORT STOCK COVID-19 PANDEMIC 5 IEC International | Global railway business overview | Q4 2020 GEOGRAPHY OF GLOBAL RAILWAY BUSINESS 2020 Q4. TOTAL NUMBER OF BUSINESS PROJECTS. 124 33 EU COUNTRIES, WESTERN EUROPE, NORTHERN EUROPE 17 NORTHERN AMERICA 12 EASTERN EUROPE 10 EASTERN ASIA 6 SOUTHERN ASIA 5 AUSTRALIA AND NEW ZEALAND SOUTHERN AFRICA 20 OTHER NUMBER OF PROJECTS INCLUDES INITIATIVES, NEW STRATEGIC DOCUMENTS AND INVESTMENT DECISIONS. 6 IEC International | Global railway business overview | Q4 2020 RAIL INVESTMENTS AND FINANCING INVESTMENT MIX (BY NUMBER OF PROJECTS) ORGANIZATIONS EU: national network modernization projects in Austria, Spain, Portugal. EU countries Metro development in Romania (EU Cohesion Fund and JICA). Warsaw metro train fleet 8 2 procurement under EBRD loan. 1 Denmark: a € 400m green loan agreement of Development banks Supranational funding* 1 Northern America national passenger operator with the Nordic 2 Investment Bank to finance the acquisition of 5 electric trains in 2020-25 5 National investments USA: $ 498.7 m funding for seven transit Southern Asia infrastructure projects in Arizona, California, *Mainly EU. Also considered development banks providing Indiana, Minnesota, Missouri, North Carolina and financing following supranational decisions 12 Utah. $ 638 m grant for the construction of Phoenix South Central LRT. Central Asia TYPES OF CONFIRMED FUNDING India: $ 241m New Development Bank’s loan for Mumbai Metro Line 6, $500 m ADB’s loan for Bangalore metro. Southern Europe 8 Grants Uzbekistan: approval of ADB’s $ 121m loan to complete the modernization of the rail network in the Ferghana Valley Western Asia 7 Loans Bosnia and Herzegovina: EIB’s € 75 m financing for Sarajevo tram project. Calculated by the number of announced projects in Q4 2020 7 IEC International | Global railway business overview | Q4 2020 RAIL INVESTMENTS AND FINANCING MAJOR PROVIDERS OF INVESTMENTS AND FINANCING IN Q4 2020 (BY VOLUMES OF FINANCING) DEVELOPMENT BANKS LOCAL INTESTATE LOANS TOTAL VALUE OF ANNOUNCED PROJECTS* AND SUPRANATIONAL (EU) vs. € 9 bn in Q3 vs. € 18 bn € 37 bn in Q2 92% 0% 8% vs. € 281 bn in Q1 *non-exhaustive, as officially announced in Q4 2020; Includes investments of financing institutions and planned KEY FACTS national investments, represents total costs of funded projects. Significant increase in number of announced national investments in comparison to Q3 and Q2, mainly thanks to national network upgrade projects in EU countries. As well as in Q3 no new important interstate loans were announced, though previously agreed projects are on-going and no cancellations were made public. Loans of development institutions in Q4, as well as in Q3, referred mainly to urban development projects (metro, LRT, urban rail). 8 IEC International | Global railway business overview | Q4 2020 RAIL INVESTMENTS AND FINANCING. NATIONAL PROGRAMMES EU, NON-EU COUNTRIES NORTHERN AMERICA OF WESTERN AND NORTHERN EUROPE Austria: Infrastructure spending package for 2021-26 had been agreed by the Council USA: Funding provided through a grant agreement from the Federal Transit of Ministers. The entire rail network should be electrified by 2035. Administration (FTA) for the construction of Phoenix South Central LRT Cost: € 17.5bn for 6 years. implemented by Valley Metro. Cost: $ 638 m. Portugal: The government has confirmed its intention to press ahead with rail investment as part of a wider national stimulus programme. Delivery of 16 rail projects, financed from both Seven transit infrastructure projects in Arizona, California, Indiana, Minnesota, the national budget and EU sources, is expected. Almost half of investments is dedicated to Missouri, North Carolina and Utah, including the Transbay Corridor Core building a new line between Porto and Lisboa. Capacity, the Minneapolis Southwest LRT, the Kansas City tram main street Cost: € 10.5 bn for 10 years. extension received grant funding. Cost: $ 498.7 m. Spain: A 36% increase in investment for the national rail network has been put forward in the draft budget proposals for 2021. Specific funding is designated for suburban enhancements Funding to complete the final design work for six infrastructure improvements Cercanías 24, improvement of punctuality, Viajeros y Mercancías 30 scheme for logistics hubs. along Canadian Pacific’s Soo Line route approved. Level crossing Cost: € 5.6 bn for 2021. improvements on the section of Amtrak’s Michigan Line received financial support. Country maps are schematic and are not intended to represent exact borders. Cost: $ 47,4 m 9 IEC International | Global railway business overview | Q4 2020 BUSINESS STRATEGIES, M&A UKRAINE: Hamburger Hafen & Logistik has established Ukrainian Intermodal Co to offer USA: Short line and regional freight railway group Patriot Rail is to container transport by rail from the port of FINLAND: two companies have been acquire the privately-owned Salt Lake, Garfield & Western Railway in Odessa to inland destinations. established by the government and local Utah. authorities to plan two major rail projects. Jaguar Transport Holdings has acquired five short line railways and a construction and maintenance company from The Western Group. RUSSIA: Cognitive Pilot intends to expand into Western Europe. CSX Corp has signed a definitive agreement to acquire Pan Am Railways. Operators Norfolk Southern, Genesee & Wyoming and Watco have ITALY: Trenitalia acquired sole control of Netinera joined wagon manufacturer TrinityRail and leasing company GATX Deutschland though the €118m purchase of the 49% Corp in a joint venture intended to accelerate the adoption of GPS stake held by Luxembourg-based infrastucture investor location tracking and other telematics across the North American Cube Transport. freight wagon fleet. Railpool has launched an Italian business. Activity in partneships in Q4 was slightly higher than in EGYPT: Bombardier Transportation will SERBIA: Participation of Alstom in Belgrade establish an Engineering Academy in metro project discussed with Serbian Minister Q3. Cairo. of Transport. Still no public revision of corporate strategies were announced by the end of 2020. PARTNERSHIPS 1. EU: The national rail operators of Germany, Austria, France and Switzerland have agreed to cooperate on the expansion of international night train services. 2. GERMANY: an agreement