Opportunities and Challenges for Rail and Bus Industry

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Commuter train engine with lights on passing another train as it pulls up to the platform

Key Findings from 2016 Transit Summit

On April 14th Empire State Development (ESD), the New York Manufacturing Extension Partnership (NYMEP) program, the Metropolitan Transportation Authority (MTA), and members of the NYS transit industry came together at the Transit Supply Chain Summit. Over 200 people attended this groundbreaking event to discuss opportunities and challenges for supply chain partners.

We heard from Empire State Development President & CEO Howard Zemsky and learned from Metropolitan Transportation Authority and New York Public Transit Association officials about the emerging opportunities stemming from significant infrastructure investments being made in New York State. A panel of manufacturers that have been vendors to the transit industry highlighted potential pathways for companies to successfully prepare for supply chain opportunities-including the ways that the New York Manufacturing Extension Partnership can help. And a roundtable discussion surfaced key strengths, challenges, and ideas for ensuring the success of the transit industry and its supply chain in New York.

Opportunities for New York Manufacturers

ESD and FuzeHub are working with the MTA and suppliers across the state to strengthen the regional competitiveness of New York manufacturers of rail and bus equipment and parts. This multi-billion-dollar industry continues to grow due to ongoing approved projects as well as pending line items in the MTA 15-19 capital plan for new buses and rail cars.

For instance, the R211 procurement for the New York City subway system will include the purchase of around 1,000 new subway cars, featuring new amenities such as USB charging ports and infotainment screens. On top of that, there are a number of other upcoming NYCT work car procurements, including:

  • 92 Flat Cars
  • 27 Refuse Flats
  • 12 Three-Ton Crane Cars
  • 2 Signal Supply Cars
  • 52 Locomotives
  • 2 Pump/Generator Car Sets

To support these and other projects, the MTA is looking for New York manufacturers and suppliers for everything from specialized screws, glass, and gaskets to bus body components and diesel engine parts. For more information on the types of goods and services needed, check out the slides in this MTA presentation: New York MTA Opportunities for Rail Cars & Buses.

Current Challenges for OEMs

At the Transit Supply Chain Summit, attendees had the chance to meet in small groups and have several very productive discussions in which representatives from both sides of the table voiced their current challenges.
One of the major concerns expressed by the OEM companies was the high cost of doing business in New York State. This directly relates to supplier quality, since as suppliers strive to remain competitive in terms of price, quality assurance activities, such as sampling and inspections, tend to decrease in frequency. Other challenges and concerns include:

  • Order placement cycle, Timing of projects either long lead-­time or rush orders
  • Lack of technically-qualified Minority and Women Business Enterprises (MWBEs) to support the transit industry
  • Supplier delays and other reliability issues

Current Challenges for Suppliers

When asked about their challenges, suppliers also voiced concern about the high cost of operations in New York State. This is particularly problematic because of the long project cycles that are commonplace in the transit sector. It can take years to complete projects, and during that time, finances are often strained for part and equipment manufacturers. Additional challenges include:

  • Complicated and disorganized bidding processes with little to no guidance
  • Lack of standardization for part numbers and names
  • OEMs make buying decisions based on price – not enough consideration for quality and timely delivery
  • Staffing issues – difficult to find reliable, skilled employees
  • Scalability
  • Need to be able to better identify root causes for problems

Through the NYS Rail Supply Chain Initiative, ESD and FuzeHub will continue to work with members of the transit industry to address these challenges and concerns.

What’s Next?

The kick-off meeting for this initiative was a great first step in bringing together manufacturers and members of the rail and bus industry in a collaborative effort to improve New York’s economic growth. Over the coming months, follow-up activities will be planned that address the issues discussed at the kick-off and make it easier for suppliers to benefit from the growing opportunities in this sector. In addition, manufacturers can start submitting information about their capabilities and products to FuzeHub for future opportunities through its manufacturing profile form.

If you’d like to know more about the initiative and how it can benefit your organization, schedule a free consultation with a FuzeHub matching specialist.  To be invited to future events, please contact us.


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