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Urban Mobility Giants
The few shaping the public transit market dynamics
As presented in the previous Sia Partners study published in 2015, among the main public transport operators, seven stand out and outperform their competitors in terms of the number of networks operated and their turnover: almost 40 billion euros, in around 40 countries.
Four public transport operators particularly stand out: the French Transdev, Keolis, RATP Group and the Hong Kongese MTR Corporation. Their activity is not slowing down, and they have not changed their strategy of expanding beyond their historic domestic market. While First Group, the leading transport operator in the UK and North America, remains an important player in public transport, it has chosen to shift focus to its domestic market in the United Kingdom. The British Arriva and Singaporean ComfortDelGro maintain international ambitions but struggle to compete with local players.
Shareholders of these global urban transportation & mobility service providers or Public Transport Operators (PTOs) remain mainly institutional, large railway groups or deposit funds. For instance, Keolis, a subsidiary of the SNCF Group (70%), and the Caisse de Dépôt et Placement du Québec (30%). As for Transdev, it is a subsidiary of the French Caisse des Dépôts et Consignations, holding 66% of its shares. The capital has been evolving gradually, with the aim to accelerate the deleveraging of large shareholder groups. The Rhenish industrialist Rethmann has acquired 34% of the capital of Transdev previously belonging to Veolia, keen to focus on its historic activities (water, waste, energy).
PTOs mainly adopt three strategic orientations: sustainability of the existing services, development through new solutions, and focusing on profitable markets. The sustainability of operations in the domestic market remains important (notably in France) as it highlights the operator's capabilities. This is evident through digital innovation and enhancement of customer experience. French and British players, mainly, continue to expand into international markets (such as RATP Dev in the United States), particularly through new modal solutions tailored to these new countries or arising new opportunities. For instance, Transdev manages a ride-hailing service offer in the United States.
Although contracts are still being awarded in Europe, we observe a trend of disengagement, particularly when the public service delegation contracts no longer align with the margin objectives. Keolis has, for instance, ceased its activities in Germany. In fact, the main market players are prioritizing profitable markets.
Finally, acquisitions and synergies are becoming ever more important as PTOs expand and consolidate their presence in different markets. We are witnessing several buyouts of local operators, facilitated by their modest capitalization, aimed at consolidating their position in the international market. For instance, Transdev followed this path in Sweden.
Partnerships are formed with key industrial players to facilitate the acquisition and maintenance of rail or road rolling stock. For instance, the Line 15 of the Grand Paris Express (France) will be operated by an international consortium comprising of RATP Dev, ComfortDelGro Transit and Alstom.
