|Status : Published||Published On : Oct, 2021||Report Code : VRSME9070||Industry : Semiconductor & Electronics||Available Format :||Page : 145|
The testing, inspection, and certification market in the railway was USD 4.5 billion in 2020, registering a CAGR of 2.6% during the forecast period 2021-2027. Testing in TIC means an industry activity that assures manufactured products, individual components, and multi-component systems are suitable for the predetermined purpose.
Inspection and testing are the operating parts of quality control, which is the most critical factor for the survival of any manufacturing company. Quality control directly supports other factors such as cost, productivity, on-time delivery, and market share. The testing, inspection, and certification market report is composed of conformity assessment agencies, which provide services from audit and inspection to testing, verification, quality assurance, and certification.
Rail is one of the important transport solutions owing to urbanization and pollution. Globalization has led to product standardization norms and has penetrated developed technologies across various industries such as building & construction, railway, electronics and automotive industries, etc., resulting in the growth of the TIC market during the forecast period 2021-2027. The rail project is complex and has to meet rigorous complex standards. Moreover, rapid urbanization, mandatory safety regulations, upsurge in the illicit trade of counterfeit and pirated products, advancement in networking and communication technology, the inclination of outsourcing testing, inspection, and certification services has propelled the growth of the TIC market in mining industry. Nevertheless, TIC provides various advantages related to its credibility and image, compliance with legal and regulatory requirements, less turnover of employees, high level of cost control improvement, and fast improvement of different processes. The railway industry requires TIC to optimize the cost of the asset, minimize the downtime throughout the lifecycle, and have access to new rail projects. The railway standards consist of EN50126, EN50128, and EN50129 which have been made by European Committee for Electro-Technical Standardization). These standards are for heavy rails systems, light rail, and urban mass transportation.
The COVID-19 pandemic resulted in a short-term decline in demand and revenue in the first quarter of 2020. The COVID-19 outbreak has provided an opportunity toto bounce back by digitalizing and decarbonizing railways, harmonizing operational requirements, and regulatory formalities, integration with other modes of transport, bundling of freight, and undertake measures to enhance the comparative advantage of railway transport, thus increases the sustainability of transport networks.
Insight by Sourcing Type
Based on sourcing type, the TIC market for the railway industry is bifurcated into in-house and outsourced. Among the two segments, the in-house segment dominates the market and is anticipated to hold the largest share during the forecast period 2021-2027. Deploying in-house testing and inspection will offer companies to have complete control over the entire process in terms of technology, skilled personnel, and testing and measurement equipment. Moreover, it can also help manufacturers in reducing in-house compliance costs and easily respond to global market demands.
Insight by Service Type
Based on service type, the TIC market for the railway industry is segmented into testing, inspection, and certification. Among these segments, the testing segment holds the largest share in the testing, inspection, and certification market in 2020 owing to the diverse product standards, stringent regulations, increasing need for improved safety, growing industrialization, and a need to protect the brand. Thus, companies from different industries are increasing their operational expenditure on the investment of testing equipment which offers market growth in the TIC market.
Insight by Industry Vertical
Based on industry vertical, the TIC market for the railway industry is divided into oil condition monitoring, fuel testing, materials testing & analysis, battery testing, product endurance & performance testing, EMC, accelerated stress testing, engine component and durability testing, lubricant and fuel system testing, railway stray current management, crude oil rail car service, and others. In order to electrify railways, there is a need to manage stray current leakage to order to ensure asset integrity and for public safety issues. This issue involves a lot of time and money annually and is linked to electromagnetic compatibility (EMC) issues, corrosion of railways, and electric safety of systems. ADAS and full self-driving solutions are used in light rail and shunting operations. The decarbonization solution will replace diesel trains with battery technology, hydrogen fuel cells, electric trains, resulting in testing of batteries, thus growth of TIC market in railway industry.
The TIC market for railway industry is characterized by various industry trends such as growing investment in AR and VR, smart sensors for inspecting railway tracks, digital communication platforms, automatic train control, mounting adoption of connected devices and cloud-based technology, and sustained consolidation of suppliers leading to globalization.
The growing government-enforced regulations, considerable industry standards, certification requirements, increased automation, technology development will propel safety when implemented on automatic train control, resulting in driving the demand for TIC in the railway industry. Moreover, the increase in attention of manufacturing companies to offer quality products will enhance customer retention, mounting demand for interoperability testing for connected devices and IoT to enable implementation of predictive maintenance and monitor any anomalies, globalization, and rise of global trade, and emerging digital technologies will boost the growth of the TIC market in the railway industry.
The testing, inspection, and certification market face certain challenges like trade wars and growth fluctuations, huge investment for automation and installation of industrial safety systems, high cost of TIC owing to diverse standards and regulations globally. Moreover, a lack of testing facilities and skilled personnel may hamper the growth of the TIC market in the mining industry.
Testing, inspection, and certification is a massive market that provides lucrative opportunities in technologies such as AI, robotics, drones, big data analytics, next-generation automation, and cloud and cybersecurity. Moreover, rolling stock hybridization, and high-speed rail will create opportunities for the growth of TIC in the railway industry.
Geographically, APAC is anticipated to have a high CAGR during the forecast period owing to the rising investment in R&D, rapid urbanization & industrialization, huge manufacturing capabilities and exports, demand for safety and product quality, and increasing consumer awareness about the importance of quality certification, testing, and inspection.
Key players are adopting technological changes to improve their product portfolio and generate new revenues, optimize the operational cost, and enhance service efficiencies via process upgrades. The industry players are taking the COVID-19 crisis as an opportunity to restructure and revisit their existing strategies, focus on new services and delivery models to access the growing demand for automation, remote service execution, and improved digitization.
The business enterprises have started opening development centers in new locations to enhance market penetration which helps in building business relations with customers and clients. Moreover, the industry players in the TIC market have started building strategies like mergers and acquisitions to generate new revenue channels.
Alstom appointed Dekra, a testing inspection and certification company, as a test leader to complete the testing of its hydrogen fuel train in the Northern Netherlands. These strategic initiatives will boost the growth opportunities of companies operating in the market.
Applus and Euskontrol, S.A had a joint venture which has been contracted by ADIF Alta Velocidad, the state-owned company responsible for Spain’s high-speed rail infrastructure, to carry out comparative testing on railway platform works on the high-speed Vitoria–Bilbao–San Sebastián line.
Some of the key players operating in the TIC market in the railway industry: Intertek Group plc, Bureau Veritas, MISTRAS Group, TUV Rheinland, SGS SA, Eurofins Scientific, TUV SUD, DEKRA SE, Applus+, and DNV GL.
Source: VynZ Research