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Railway Transport and Manufacture of Locomotives and Rolling Stock in South Africa
BY Liz Kneale
South Africa
12 March 2021
R 14 400.00 (ZAR)  
estimated $ 989.27 (USD) *
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Railway Transport and Manufacture of Locomotives and Rolling Stock in South Africa


The rail industry was plagued by aging infrastructure and governance issues prior to the onset of the coronavirus pandemic. The industry has been further affected by a decrease in rail freight and passenger volumes and revenues due to lockdown restrictions. The poor economy has led to lower production, with less freight to transport, resulting in lower investment in expansion, and reducing the demand for additional rolling stock for freight. The state-owned Passenger Rail Agency of South Africa (Prasa) and Transnet, which dominate the sector, are suffering the effects of the legacy of poor governance and procurement irregularities with ongoing investigations by the Special Investigation Unit and appearances at the commission of inquiry into state capture. Government’s proposed open access to the rail network for private sector investment should enhance competitiveness and promote efficiency in the sector.


Prasa and Transnet


In December 2019, the minister of Transport dismissed Prasa’s interim board and acting CEO and put the company into administration. A permanent board was appointed in October 2020. Prasa’s operational issues include fleets out of service and a train shortage, the deteriorating condition of rolling stock and infrastructure, a decline in the number of trains scheduled, train delays and cancellations. Transnet’s 2020 performance was affected by deteriorating economic conditions reducing the volumes requiring transport by rail, increased security incidents, adverse weather patterns and poor rail network conditions in some key corridors. Its 2021 interim results reflect significant declines in revenue and volumes as a result of the lockdown.


Report Coverage


This report focuses on freight and passenger rail transport and the manufacture of railway locomotives and rolling stock. It includes comprehensive information on Transnet, Prasa and Gautrain, including financial performance, infrastructure development and governance and supply chain issues. There are profiles of 31 companies including Transnet and Prasa, suppliers such as Siemens, ABB and Actom and logistics companies such as SAFreight Logistics.


Page
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 6
2.2. Geographic Position 9
3. SIZE OF THE INDUSTRY 12
4. STATE OF THE INDUSTRY 19
4.1. Local: Overview 19
4.1.1. Local: Prasa 20
4.1.2. Local: Gautrain 23
4.1.3. Local: Transnet Freight Rail 25
4.1.4. Corporate Actions 27
4.1.5. Regulations 28
4.1.6. Enterprise Development and Social Economic Development 33
4.2. Continental 36
4.3. International 40
5. INFLUENCING FACTORS 47
5.1. Coronavirus 47
5.2. Economic Environment 50
5.3. Rising Operating and Input Costs 52
5.4. Investment in Rolling Stock and Rail Infrastructure 54
5.5. Private Sector Capacity Expansion Projects 60
5.6. Private Sector Open Access and Concessions 61
5.7. Governance and Supply Chain Issues 62
5.8. Localisation and Supplier Development Programmes 64
5.9. Challenges and Issues Facing the Mining Sector 66
5.10. Technology, Research and Development (R&D) and Innovation 67
5.11. Labour 68
5.12. Crime, Security and Safety 72
5.13. Cyclicality 75
5.14. Environmental Issues 75
6. COMPETITION 77
6.1. Barriers to Entry 78
7. SWOT ANALYSIS 78
8. OUTLOOK 80
9. INDUSTRY ASSOCIATIONS 81
10. REFERENCES 82
10.1. Publications 82
10.2. Websites 84
APPENDIX 1 86
Transnet Freight Rail Business Units: Commodities and Critical Train Flows 86
APPENDIX 2 89
Summary of Notable players 89
APPENDIX 3 98
Current and Future Passenger and Freight Rail Related Projects on the African Continent 98
APPENDIX 4 105
Suppliers to the Rail Manufacturing Industry 105
APPENDIX 5 112
Localisation and Supplier Development Initiatives and Incentives 112
COMPANY PROFILES 115
ABB SOUTH AFRICA (PTY) LTD 115
ACTOM (PTY) LTD 118
AFRICAN RAIL AND TRACTION SERVICES (PTY) LTD 126
ALSTOM UBUNYE (PTY) LTD 127
BOMBARDIER TRANSPORTATION SOUTH AFRICA (PTY) LTD 129
BOMBELA OPERATING COMPANY (PTY) LTD 131
CRRC E-LOCO SUPPLY (PTY) LTD 133
CRRC SA ROLLING STOCK (PTY) LTD 135
DENEL VEHICLE SYSTEMS (PTY) LTD 137
ETION LTD 140
GALISON MANUFACTURING (PTY) LTD 144
GIBELA RAIL TRANSPORT CONSORTIUM (RF) (PTY) LTD 146
GLOBAL RAILWAY ENGINEERING (PTY) LTD 149
IKUSASA RAIL (PTY) LTD 151
KNORR-BREMSE (SOUTH AFRICA) (PTY) LTD 153
LUCCHINI SOUTH AFRICA (PTY) LTD 155
PASSENGER RAIL AGENCY OF SOUTH AFRICA 157
PROGRESS RAIL SA (PTY) LTD 161
R AND H RAIL (PTY) LTD 163
SAFREIGHT LOGISTICS (PTY) LTD 165
SIEMENS (PTY) LTD 167
SIYAHAMBA ENGINEERING (PTY) LTD 171
SWASAP (PTY) LTD 173
THELO DB (PTY) LTD 175
TMH AFRICA (PTY) LTD 176
TRANSNET SOC LTD 177
TRAXTION SHELTAM (PTY) LTD 182
TRIDENT SOUTH AFRICA (PTY) LTD 185
VERSA RAIL (PTY) LTD 187
WABTEC SOUTH AFRICA TECHNOLOGIES (PTY) LTD 189
WICTRA HOLDINGS (PTY) LTD 191