Manufacturers railway sector should only be resumed from 2020

The railroads have sued only the replacement of the fleet of freight cars on the lack of investments in the sector, a result of the strong economic crisis that devastated the Country. And even betting on resumption of concessions in the Government elected, local manufacturers should have an increase of volumes only from 2020. "We are optimistic with the expectation of renewal of concessions, expected to occur over the next year. But the real impact on manufacturers should only come from 2020, "said the DCI National Sales Director of the Randon group, Wilson Ferri. He says that before the fall of demand in recent years, the few industry players – Usiminas Mecânica, Iochpe-Maxion (through joint ventures Amsted Rail and AmstedMaxion), besides the Gaucho Group – had a significant reduction of the margins. "The profitability in the segment has been increasingly constrained," he says. As it was found the DCI with the manufacturers, the demand since mid-2010 remained stable between 3000 and 4000 units. However, with the deterioration of the economic environment, companies began to buy cars and components only for small projects or even for fleet replacement. According to data from the Brazilian Association of Railway Industry (Abifer), the production of cars in 2018 should rotate between 2000 and 3000 units. Last year, this volume reached 2800 units. " The Brazil always had a focus on road segment. The country needs to look at the infrastructure of multimodal form, so that logistics is more efficient, "says the CEO of Iochpe-Maxion, Marcos s. de Oliveira. The company owns a factory of fused to the railway sector in cruise and a plant for the Assembly of cars in Hortolândia, both in joint-venture, in São Paulo. "On average, this market turns around 3000 to 3500 units per year in the country, but stepping back," said the Executive. "But the rail industry has always been cyclical in Brazil", he adds. The Director of Randon estimates that the market for freight cars, this year, should achieve around 2300 units and, in 2019, only 1500. In this scenario, he states that the controlled inflation has at least contributed to relieving the banks. "As few components are imported, this helps to ameliorate the situation of manufacturers." The Brazilian market has already reached produce approximately 4700 freight cars in 2015, which gives an idea of idleness in this industry. "And margins tend to fall," Ferri. Investments provisional measure (MP) 845/18, which creates the National Rail Development Fund (FNDF), was approved by the Joint Committee that studied the issue last Wednesday (14). The text follows now for the Chamber of Deputies. According to the Government, the resource will enable important investments, mainly in northern Brazil. It is expected that the Fund will last five years and expand the logistics capacity of the National rail system. Among the sources provided are resources from the EU budget, donations, in addition to collections with the granting of concessions to railroad passages. But Oliveira, Iochpe-Maxion, cautious about the future. "The rail segment needs special attention and at the moment we are very cautious." The Director of Randon expects at least in 2019 happen important renovations. "We hope that in the first quarter of next year for renewal of the course and, in the second half of 2018, VLI and MRS. out of the role," ponders Ferri. Still, he does not believe that the level of sales of freight cars exceeding the annual average of 4000 units. "We are quite optimistic that the new Government must unlock the renewals of leases, whose procedures have already begun in current management." For the Executive, however, the new concessions in the segment should only come in the medium and long term. "Railroads as the North-South and the Ferrogrão should be more forward," predicts Ferri.