Germany Rail Industry
Overview
In 2023, the German rail industry directly supported 54,300 jobs (-4.2%) and generated USD 15.6 billion (+3.6%) in annual revenues. While manufacturers of rail vehicles and components generated almost USD 11.25 billion (-1%), revenues from rail infrastructure suppliers increased by nearly 17% to USD 4.3 billion. For the past 10 years, exports on average have accounted for 40% of revenues generated by the German rail industry. New orders from both domestic (ca. USD 14.2 billion) and international (EUR 9.2 billion) customers increased to USD 23.4 billion (+57% from 2022), well above the level of the past five years.
The German railroad network has a route length of around 39,200 km (24,500 miles) and the largest rail and network operator is Deutsche Bahn Group with approx. 33,400 km (20,900 miles). Traffic on the German rail network has been growing rapidly: between 1994 and 2023, passenger rail traffic increased by more than 50% while freight rail traffic has increased by almost 90%. Trains now cover more than one billion kilometers annually on the Deutsche Bahn network alone.
In 2023, regional rail transport (SPNV) in Germany accounted for 59 billion passenger-kilometers (+12%), which equals roughly 2/3 of the entire rail transport volume. Long-distance rail transport (SPFV) reached a new high at 47 billion passenger-kilometers (+10%). Rail freight transport performance in Germany fell to 127 billion ton-kilometers (-9%).
Today, 90% of the transport mileage on German networks is electric and around 62% of the German rail network is electrified — 99% of long-distance rail transport, 94% of rail freight transport, and 79% of regional transport are electric. Accordingly, the rail industry in Germany makes important contributions to sustainable mobility, both in passenger and freight transport, and supports Germany’s ambitious targets to significantly reduce greenhouse gas emissions by 55% by 2030 and to become climate neutral by 2045. This is of particular importance since the entire transport sector alone is responsible for around 20 percent of CO2 emissions.
Market Structure
The German rail industry is deeply integrated and consists of around 200 companies of various sizes, including leading global system suppliers & integrators, a significant number of international medium-sized suppliers, including many “hidden champions” of the rail industry, as well as innovative startup companies. In addition to the large and often global system suppliers, roughly 150 predominantly medium-sized suppliers are active in the rail industry in Germany who contribute around 70% of the rail components and production in Germany. Rail companies with operations in Germany cover the entire value chain: development and production of systems and components for rail vehicles and infrastructure, as well as signaling technology and services. As a global leader for rail technology, products and services, the German rail industry has an export quota of over 40% — a significant number of companies even well beyond that and up to 80 % in foreign sales.
Opportunities
In 2023, the German government announced plans to significantly increase investments in its national rail infrastructure to (1) meet the nation’s ambitious climate protection goals and (2) to increase the performance and availability in order to cope with growing passenger and freight transport volumes. In 2023, Germany’s federal government announced plans to allocate an additional USD 48.7 billion towards Germany’s railway infrastructure by 2027 — the total investment amount in Germany’s rail infrastructure thus reaching USD 95.2 billion for the period 2024-2027.
Last year, USD 18.28 billion was invested in Germany’s rail infrastructure. For 2024, the German government and Germany’s main railway operator Deutsche Bahn Group plans to invest up to USD 17.7 billion solely for the maintenance and expansion of the rail infrastructure. Accordingly, Deutsche Bahn plans to expand, modernize and renew over 2,000 kilometers of tracks, 2,000 switches, 150 bridges and 1,000 stations this year. As many as 5,500 new employees have been hired to maintain and expand the network.
Challenges for the industry exist due to the uncertain long-term planning and investment strategy by customers (e.g. rail operators and national & sub-national governments), as well as inflation and especially high energy prices.
Opportunities exist for U.S. suppliers of innovative technologies and solutions that address current challenges/opportunities and are compliant with corresponding EU regulation and industry standards. German companies are generally open to working with US companies. Limitations may exist in case of procurement tenders by German/EU rail operators — in this case a legal presence in the European Union and/or strategic partners may be required.
Relevant Events in Germany:
• InnoTrans Berlin, September 24-27, 2024: https://www.innotrans.de
• Railway Forum Berlin, September 2-5, 2025: https://www.railwayforum.de/
Contact:
Felix Happe
Commercial Specialist
U.S. Commercial Service Munich, Germany
P: +49-89-288-8752
mailto:Felix.Happe@trade.gov
https://www.trade.gov/germany