There is a strong need for infrastructure investments tobe better coordinated with the requirements of logistics operators. It isimportant for the operators to be involved in public infrastructure investmentplanning to ensure the efficient use of their resources and capacity. But manyinfrastructure owners and operators do not have a global view or easy access toglobal best practices. On the other hand, construction companies are becomingincreasingly international, enabling the transfer of technology and workingpractices. But the industry would benefit if operators, who understand themarkets, had a more influential role here. Complementing the role of the public sector, the privatesector brings an entrepreneurial approach to infrastructure development withmarket-based solutions that can expand the provision of essential services.
Thehealthy competition encourages firms to innovate, provide quality service at alow cost and at low lead times, and be responsive to customer’s needs. Itallows fresh capital to be injected into rail industry. At times, the publicsector simply does not possess the necessary resources. Reliance on privatecapital is thus the only way to complete necessary renovations, upgrades, andmaintenance that result in safer, faster and more efficient service.In the rail sector, there are also cases in which rollingstock investments were not coordinated with infrastructure.
However, there arealso examples of PPP. Intercity ExpressProgram (IEP) in the UK is being handled as a PPP of up to 35 years at a valueof £5.8 billion. It involves the procurement of 700 seat high-speed trainsspecified to run on existing tracks (and subject to a coordinated program ofinfrastructure improvements) as an alternative to the approach elsewhere ofbuilding new high-speed dedicated lines (though these are also planned in theUK). Creating new business models to adopt digitization andanalyticsThe trend toward Internet of Things (IoT) and digitizationhas started generating significant changes, not only in business operations butalso in people’s lifestyles. Rail operators and individuals today prefer the finaloutcomes than products; share, rather than purchase; and work in open, ratherthan closed environments. Suppliers should gain a better understanding of theirclients’ issues to be able to create new, value-creating solutions.
Rail hasalready introduced the “fourth industrial revolution” technology and willcontinue to develop digitalized mobility solutions to help operators improvetrain punctuality and reliability and passenger experience.Advancements in digital solutions, connectivitytechnology, remote monitoring, and big data analytics will offer newopportunities for the rail suppliers, but they need to adapt to the changingenvironment and business models. It isnoticed that rail operators prefer a supplier who offers a consolidated packagefrom hardware, software, and maintenance services. Apart from advances intechnology and cost efficiency, customers’ preference for asset availabilityfurther contributes to this development. Customers only pay for theavailability of rolling stock, so the increase in reliability via predictivemaintenance solutions and remote support helps significantly boost supplier’svalue proposition.
Solutions from the digital space are not limited torail operations and maintenance, of course, but are also likely to have a hugeimpact on the industry’s product development processes. Offering, for example,test drives in client-configured products or utilizing digital twin conceptsmay further boost suppliers” value propositions.