Rail Business in Denmark. Market Spotlight by ASTRAN Business Consulting GmbH
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1 Rail Business in Denmark Market Spotlight by ASTRAN Business Consulting GmbH
2 General Information about the Danish Economy Denmark is still recovering from a decrease in private consumption. Its real GDP growth rates in 2015 were at 1.6% and 1.1% in However, due to a flattening in energy prices and stronger public investment economic growth is predicted to increase by rates between 1.5% and 2.0% in 2017 and Denmark is ranked as one of the most innovative economies in the world both by the European Innovation Scoreboard and the Global Innovation Index. More than 3% of GDP is invested annually in research and development, of which two-third are attributed to the private sector. Labor costs* in Denmark are considerably higher in comparison to other EU members. Region Business Economy Industry Construction Services Denmark EU28 average Germany Doing business in Denmark: the World Bank ranks Denmark as one of the top three business environments in the world.
3 General Information about the Danish Economy Strengths High stability of the economy as a whole Reliable economic partner Outstanding transport infrastructure Flexible labor market and high education level Good opportunity to entry the Nordic markets Weaknesses Relatively small domestic market High wage and cost level Relatively high taxes and charges (more for consumers than for companies) Weak competition in some industries because of dominance of few incumbents Opportunities Innovative spirit, open to technical innovations High priority for the development of renewable energies and energy efficiency Opportunities for entry into numerous infrastructure projects Business potentials for new construction projects and modernization projects in many industries Threats Vulnerability to economic fluctuations due to small domestic industry sizes Network-like (cluster) structure in many economic areas Shortage of skilled workers especially in times of important major (public) construction projects
4 Danish Rail Market and Industry Since 2000 the Danish rail sector is partly liberalized. Regional passenger transport is mainly provided by private operators like Arriva. Freight transport is mainly provided by DB Schenker Rail Scandinavia A/S. Key figures of the Danish railway market 1. Overall length of railway tracks: approx. 2,700 km 2. Banedanmark is responsible for over 90% of the railway network (maintains the network and allocates paths for train operators) 3. Average age of existing locomotives: 41.7 years (diesel locomotives) / 13.9 years (electric locomotives) 4. Average age of railway train sets: 16.8 years (diesel train sets) / 17.6 years (electric train sets)
5 Structure of the Danish Rail Industry ASTRAN identifies over 70 companies which are currently operating and are located in the domestic rail industry market in Denmark. Nearly 60% of all companies must be considered as small. About 20% are medium-sized. About one-third are active in the rolling stock segment (33%), mainly operating as sub-suppliers for the large and globally operating system houses and rolling stock manufacturers like Siemens, Bombardier and Alstom. Distribution of Companies by Size Share in % of Total Number of Companies Distribution of Companies by Segment Share in % of Total Number of Companies Large-sized 23% Engineering Services 27% Infrastructure 20% Small-sized 58% Medium-sized 19% Control and Safety Systems 20% Rolling Stock 33%
6 Performance of the Danish Rail Industry Market Attractiveness of the Danish Rail Market [0: very unattractive; 5: very attractive] Innovative activities Denmark Market size Germany Market growth (CAGR) Factor Market size Market growth (CAGR) Corruption index Source/Description Size of the domestic rail industry sales volume relative to the total GDP ASTRAN analysis for Danish rail industry between 2009 and 2015 Transparency International Corruption Perception Index 2016 Market liberalisation Return on sales (EBIT) Market liberalization IBM Global Business Services Rail Liberalization Index 2011 Corruption index Innovative activities European Union Innovation Scoreboard 2016
7 Character of the Danish Rail Market Typical for Scandinavian markets the Danish economy is also characterized by a clear focus on fair and transparent competition this also applies to the national rail markets Denmark is known as the gateway to the Nordic markets The emphasis on innovations shows the knowledge-intensive orientation of the Danish railway industry as an experienced and established provider of railway applications, railway components or systems, also foreign companies are able to achieve a promising market opportunities Danish government early defined a clear strategy for the consistent expansion and strengthening of the rail system this strategy is pursued independent of political parties
8 There is more to know! Find more information on the Danish and overall Scandinavian rail markets in our report Scandinavian Rail Market Insight Status Quo and Forecast 2025 The report offers: 1. Explicit statement on the dimensions and the structure of the Scandinavian railway industry market 2. List of all market players who are active in the Danish, Norwegian and Swedish rail sectors 3. Prognoses regarding the sales trends and the market attractiveness development Get prepared to address the challenges of tomorrow and seize the opportunities. Our report will serve an important information source for existing and potential market players in the Scandinavian railway market and helps to adjust the strategic orientation of your company.
9 Rail Business in Denmark Market Spotlight by ASTRAN Business Consulting GmbH (0)
10 External References Germany Trade & Invest GTAI (2017): Wirtschaftsdaten Kompakt Dänemark European Commission (2017): European Union Innovation Scoreboard Country Profile Denmark Eurostat (2017): Arbeitskosten in der EU The World Bank (2017): Doing Business 2017 Economy Profile 2017 Denmark Germany Trade & Invest GTAI (2016): SWOT-Analyse Dänemark Transparency International (2017): Corruption Perceptions Index 2016 IBM Global Business Services GmbH (2011): IBM Rail Liberalization Index
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