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Railway Engineering - UK - March 2016

EXECUTIVE SUMMARY
The market
Growth in government funding for the railway industry driven by Crossrail
Figure 1: Government railway funding, 2011-15
Network Rail spending on renewal schemes in 2014/15 higher than the allowance set by rail regulator
Figure 2: Rail renewal expenditure by asset, 2014/15
Total expenditure on rail network enhancement schemes more than doubled since 2009/10
Network Rail encounters major difficulties in delivering enhancement schemes in 2014/15, prompting a review and re-plan of the programme
Average age of rolling stock rises to 20 years in 2014/15
Crossrail will remain the largest rail infrastructure project over the next few years
The largest rail infrastructure project over the next two decades is set to be the development of the national high speed rail network HS2
Figure 3: Cost of enhancement projects during CP5, 2014/15-2018/19
Market factors
Network Rail’s funding and delivery outputs are agreed in five-year blocks called control periods
Increase in passenger journeys to drive investment in rail infrastructure and capacity
Companies
What we think
KEY INSIGHTS
Network Rail encountered major difficulties in delivering enhancement schemes in 2014/15 - the first year of CP5 - prompting a review and re-plan of the programme. What are the key proposals on how the rail upgrade programme can be put on a realistic and deliverable footing?
With the government having recently been more heavily involved in the procurement of major rolling stock orders, is this trend expected to continue?
How is the UK passenger rolling stock fleet expected to develop?
INTRODUCTION
Definitions
Methodology
Abbreviations
Market positioning
UK ECONOMY
Overview
Figure 4: UK GDP quarterly development, 2003-15
Figure 5: UK GDP in economic downturns and recoveries since 1979
Inflation
Interest rates
Consumer spending
Manufacturing
Figure 6: UK output by industry, 2008-15
Business investment
Figure 7: UK GFCF 2003-15
Imports
Exports
MARKET FACTORS
Key points
Rail network funding and regulation
Sir Peter Hendy’s re-plan for Network Rail’s enhancement programme 2014-19
Drivers of investment in rail industry
Railways Act 2005
High Speed Two (HS2) and proposed major schemes
RAIL FINANCE
Key points
Overview
Figure 8: Government railway funding, by type, 2011-15
Figure 9: Private investment in railways, by type, 2011-15
INFRASTRUCTURE INVESTMENT
Key points
Introduction
Figure 10: Rail infrastructure in Great Britain, 201115
Figure 11: Rail infrastructure in Great Britain, 2011-15
Figure 12: Rail industry infrastructure activity, 2009-14
Figure 13: Major rail infrastructure projects delivered during CP4, 2009-14
Capital expenditure
Figure 14: Rail infrastructure renewals, enhancements & maintenance expenditure in Great Britain, 2010-15
Figure 15: Rail infrastructure renewals, enhancements & maintenance expenditure in Great Britain, 2011-15
Expenditure analysis
Figure 16: Renewal expenditure by asset, 2014-15
Figure 17: Private sector investment in track and signalling, 2011-15
Figure 18: Private sector investment in stations, 2010-14
Figure 19: Analysis of enhancement expenditure in England and Wales, by type, 2010-14
Figure 20: Analysis of enhancement expenditure on non-PR08 funded schemes by type, 2010-14
Figure 21: Analysis of enhancement expenditure in Scotland, by type, 2010-2014
Figure 22: Analysis of enhancement expenditure in Great Britain, by type, 2015
ROLLING STOCK
Key points
Introduction
Figure 23: Average age of rolling stock, by sector, 2011-15
Figure 24: Average age of rolling stock, by sector, 2011-15
Figure 25: Average Age of Rolling Stock, by Company, 2011-15
Figure 26: Number of passenger journeys, by sector, 2011-15
Figure 27: Share of passenger journeys, by sector, 2014/15
Figure 28: Distance covered by freight trains, 2011-15
Figure 29: Rolling Stock Parc, as of March 2015
Capital expenditure
Figure 30: Private sector rolling stock investment in Great Britain, 2011-15
Figure 31: Private Sector Rolling Stock Investment in Great Britain, 2011-15
SUPPLY SOURCES
Key points
Production
Overview
Hitachi and Bombardier Transportation only major train manufacturers with UK plants
Figure 32: UK production of locomotives, rolling stock and other equipment, 2010-14
Segmentation
Figure 33: Segmentation of the UK production of locomotives, rolling stock and other equipment, by type, 2010-14
Imports
Overview
Figure 34: UK imports of locomotives, rolling stock and other equipment, 2011-15
Segmentation
Figure 35: Segmentation of UK imports of locomotives, rolling stock and other equipment, by type, 2011-15
Figure 36: UK imports of locomotives, rolling stock and other equipment, by type, 2014
Exports
Overview
Figure 37: UK exports of locomotives, rolling stock and other equipment, 2011-15
Segmentation
Figure 38: Segmentation of UK exports of locomotives, rolling stock and other equipment, by type, 2011-15
INVESTMENT PROFILES
Chapter summary
Introduction
Figure 39: Train Operating Companies, as of February 2016
Train operating companies
Abellio Greater Anglia
Figure 40: Key statistics for Abellio Greater Anglia, 2013-15
Arriva Trains Wales
Figure 41: Key statistics for Arriva Trains Wales, 2013-15
c2c
Figure 42: Key statistics for c2c, 2013-15
Chiltern Railways
Figure 43: Key statistics for Chiltern Railways, 2013-15
Cross Country
Figure 44: Key statistics for Cross Country, 2013-15
Virgin Trains East Coast (formerly East Coast)
Figure 45: Key statistics for Virgin Trains East Coast, 2013-15
East Midlands Trains
Figure 46: Key Statistics for East Midlands Trains, 2013-15
Eurostar
Govia Thameslink Railway (formerly First Capital Connect)
Figure 47: Key statistics for Govia Thameslink Railways, 2013-15
First Great Western
Figure 48: Key statistics for First Great Western, 2013-15
First Hull Trains
Abellio ScotRail (formerly First ScotRail)
Figure 49: Key statistics for Abellio ScotRail, 2013-15
First TransPennine Express
Figure 50: Key Statistics for First TransPennine Express, 2013-15
Grand Central
Heathrow Connect
Heathrow Express
London Midland
Figure 51: Key statistics for London Midland, 2013-15
London Overground
Figure 52: Key statistics for London Overground, 2013-15
Merseyrail
Figure 53: Key statistics for Merseyrail, 2013-15
Northern Rail
Figure 54: Key statistics for Northern Rail, 2013-15
North Yorkshire Moors Railway
Southeastern
Figure 55: Key Statistics for Southeastern, 2013-15
Southern
Figure 56: Key Statistics for Southern, 2012-14
South West Trains
Figure 57: Key Statistics for South West Trains, 2013-15
Virgin Trains West Coast
Figure 58: Key statistics for Virgin Trains West Coast, 2013-15
West Coast Railway
Freight operators
Colas Rail
Figure 59: Key statistics for Colas Rail, 2015
Direct Rail Services
Figure 60: Key statistics for Direct Rail Services, 2015
DB Schenker Rail
Freightliner Group
Figure 61: Key Statistics for Freightliner in the UK, 2015
GB Railfreight
Figure 62: Key statistics for GB Railfreight, 2015
Mendip Rail
Rolling Stock Operating Companies
Angel Trains
Porterbrook Leasing Company
Eversholt Rail Group
QW Rail Leasing
Network Rail
London & Continental Railways/HS1
High Speed 2 Ltd
SUPPLY INDUSTRY STRUCTURE
Chapter summary
Industry development
Hitachi to start production at new UK manufacturing plant in 2016, joining Bombardier as the country’s only rolling stock manufacturers
Figure 63: Analysis of the changes in the structure of the railway & tramway rolling stock manufacturing industry, 2011-15
Structure by employment
Figure 64: Analysis of the employment structure of the railway & tramway rolling stock manufacturing industry, 2014-15
Structure by turnover
Figure 65: Analysis of the financial structure of the railway & tramway rolling stock manufacturing industry, 2014-15
COMPANY PROFILES
BOMBARDIER TRANSPORTATION UK
Figure 66: Financial analysis of Bombardier Transportation UK, 2010-14
Company strategy and outlook
AMEC FOSTER WHEELER
Figure 67: Financial analysis of AMEC Foster Wheeler, 2010-14
Company outlook
AMEY/AMEY RAIL
Figure 68: Financial analysis of Amey UK, 2010-14
Company strategy and outlook
Amey Rail
Figure 69: Financial analysis of Amey Rail, 2010-14
ANGEL TRAINS
Figure 70: Financial analysis of Angel Trains, 2010-14
Company strategy & outlook
BALFOUR BEATTY GROUP
Recent rail sector developments
Figure 71: Financial analysis of Balfour Beatty, 2010-14
Figure 72: Turnover analysis of Balfour Beatty by segment, 2013-14
KNORR-BREMSE GROUP
Figure 73: Financial analysis of Knorr-Bremse Rail Systems (UK), 2010-14
SIEMENS RAIL AUTOMATION HOLDINGS
Figure 74: Financial analysis of Siemens Rail Automation Holdings, 2011-15
Company strategy & review
BABCOCK RAIL
Figure 75: Financial analysis of Babcock Rail, 2011-15
Company review & outlook
NETWORK RAIL
Figure 76: Financial analysis of Network Rail, 2011-15
Company review & outlook
EVERSHOLT RAIL (UK)
Figure 77: Financial analysis of Eversholt Rail (UK), 2010-14
PORTERBROOK LEASING COMPANY
Figure 78: Financial analysis of Porterbrook Leasing Company, 2010-14
HITACHI RAIL EUROPE
Figure 79: Financial analysis of Hitachi Rail Europe, 2011-15
Company strategy
FORECAST
Chapter summary
Market size
ORR’s original funding settlement for CP5
ORR introduces new targets for Network Rail’s asset management for CP5
Move towards framework agreements during CP5
Highlights of Network Rail’s investment proposals
Sir Peter Hendy’s Review and re-plan for CP5 enhancement programme
Funding for CP5 enhancement schemes to be enhanced by £2.5 billion
Infrastructure
Figure 80: Rail infrastructure projects pipeline, as of July 2015
High speed rail network (HS2)
Other proposed new rail lines
Maintenance expenditure in CP5
Figure 81: Forecast rail maintenance expenditure for CP5, 2014/15-2018/19
Figure 82: Forecast rail maintenance expenditure for CP5, 2014/15-2018/19
Figure 83: Forecast rail maintenance expenditure for CP5, by Activity, 2014/15-2018/19
Capital expenditure in CP5
Figure 84: Forecast capital expenditure for CP5, by type, 2014/15-2018/19
Renewals expenditure in CP5
Figure 85: Forecast rail renewals expenditure for CP5, by activity, 2014/15-2018/19
Figure 86: Forecast rail renewals expenditure for CP5, 2014/15-2018/19
Figure 87: Forecast rail track renewal activity for CP5, by activity, 2014/15-2018/19 and CP5 total
Figure 88: Forecast rail structures renewal for CP5, by activity, 2014/15-2018/19
Figure 89: Forecast rail electrification & plant renewal for CP5, by activity, 2014/15-2018/19
Figure 90: Forecast building renewal for CP5, by activity, 2014/15-2018/19
Enhancements expenditure in CP5
Figure 91: Cost of enhancement projects during CP5
Crossrail
Thameslink Programme
Electrification schemes
Other committed schemes
Other named schemes and CP4 rollover schemes
HLOS capacity metric schemes
Edinburgh to Glasgow Improvements Programme (EGIP)
Borders
Other Scottish projects
Rolling Stock
Long Term Passenger Rolling Stock Strategy
Figure 92: Fleet Size Requirements for Passenger Fleet under a Low Growth Forecast, 2014-44
Figure 93: Fleet Size Requirements for Passenger Fleet under a Medium Growth Forecast, 2019-44
Figure 94: Fleet Size Requirements for Passenger Fleet under a High Growth Forecast, 2019-44
Figure 95: Role of electric rolling stock under the medium growth forecast, 2019-2044
FURTHER SOURCES AND CONTACTS
Trade associations & regulatory bodies
Trade magazines
Trade exhibitions

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