AIA Decision Tools · Manufacturing

The Railway Manufacturing Index

One number for a strategic question: how competitive is South African rail manufacturing — against Chinese corridor-bundled and Indian refurbished-locomotive penetration — and where is the localisation case actually winnable? Tracked by segment, tier and location, re-scored as procurement decisions evolve.

48/100
Composite RMI · Q2 2026
▼ 3 vs Q4 2025 — import pressure rising
71
Wagon segment — approaching bankable
31
Locomotive segment — premature

The index splits where the industry splits.

Treating “rolling-stock OEM” as one number hides the finding. The index scores wagons and locomotives separately — because the competitiveness gap, demand pipeline and cluster benefit are different in each.

71
Wagons — close to bankable at scale

Competitiveness gap ~5–10%; cluster benefit (8–12%) approaches the gap itself. Contracted demand ~400–600/yr clears minimum efficient scale (100–150/yr) comfortably. Binding constraint: off-take duration, not economics.

31
Locomotives — analytically premature

Manufacturing gap ~15–25%, ~25–40% once financing terms are included; cluster benefit closes only 4–6%. Contestable SA new-build demand ~0–20/yr, below the 40–60/yr MES. Binding constraint: the gap itself, and demand.

What the index is built from.

Five sub-indices, scored 0–100 and weighted into the composite. Members see the full segment breakdown and the location and trend layers.

Localisation depth64
Demand pipeline strength78
Cluster benefit captured70
Cost competitiveness68
Import-pressure resistance60

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Import penetration: who is taking the locomotive demand.

Contestable SA locomotive demand, by where it is actually going (illustrative, from disclosed 2025–26 procurements). SA new-build is the thin slice.

China — corridor-bundled 38%
India — refurbished (RITES) 34%
Second-hand / refurb 18%
SA new-build 10%
China: TAZARA, Dar–Burundi — financing-led, 2–4% / 15–20yr India: RITES Cape-gauge at 60–65% of new-build, EXIM-financed KiwiRail/Wabtec refurb (Traxtion) SA OEM new-build

The manufacturing footprint.

Where the cluster physically sits — and what each node does. Co-location is the freight saving the index prices in.

Rosslyn (Tshwane)
Traxtion Rail Services Hub — KiwiRail loco modernisation
Refurbishment
Boksburg
Alstom — Traxx 23E locomotive bodies
OEM assembly
Durban / Bayhead
Transnet Engineering — bogie frames, final assembly
Tier-1 + assembly
Nigel / Ekurhuleni
Wagon manufacturers + tier-1 component base
Wagon OEM

Illustrative AIA index built on the framework in The Cluster Question. Figures are working estimates from public-record procurements, re-scored as conditions evolve — not a forecast.

Read the framework paper