Greenbrier enters Turkish railway market

The Greenbrier Companies, Inc. has entered the growing freight rail market in Turkey with a majority stake in railcar manufacturer Rayvag Vagon Sanayi ve Ticaret A.S. (Rayvag). Greenbrier believes there are growing opportunities for private operators to access freight rail in Turkey, as the country “offers a key rail transportation connection between Asia and Europe,” and “transcontinental rail shipments through Turkey create a need for European rail standards, favoring Greenbrier’s leadership in design and manufacturing.”

Greenbrier on Aug. 8 completed an agreement between Rayvag and Greenbrier’s European subsidiary, Greenbrier-AstraRail, to take an approximately 68% ownership stake in the Turkish company, a railcar manufacturer and provider of railcar repair and parts services based in Adana, Turkey. Rayvag also provides maintenance services for railcars and manufactures bogies and spare parts for railcars in the region.

Rayvag was founded in 2007 by Asim Suzen, who retains a 32% equity interest in the business. Suzen continues to serve Rayvag as its Managing Director and is also a member of the Turkish Ministry of Transportation and Infrastructure Railway Transportation Association.

“Rayvag is committed to growth but could not achieve scale without this investment by Greenbrier,” Suzen said. “Greenbrier-AstraRail’s expertise in designing freight cars that meet European rail standards, as well its world-class manufacturing systems and procurement practices, position Rayvag to respond to the rapidly advancing demands of Turkey’s freight rail industry. Greenbrier’s financial strength also provides Rayvag with a partner capable of pursuing the substantial growth that we foresee in the Turkish railway supply business during the coming years. I am proud to lead Rayvag under Greenbrier’s majority ownership.”

Greenbrier noted that the freight transport sector in Turkey “is growing quickly, and the Turkish government is committed to modernizing the existing rail system. Beginning in 2014, the state-owned Turkish Railways opened the rail network to use by private operators. Since then, freight movement on the railroad is on the rise. With rail freight volumes expected to see an increase of 65 million tons by 2023, the Turkish government plans to expand rail lines, proposing to invest more than US$23.5 billion toward rail infrastructure projects through 2023. The Turkish rail industry also is migrating to European rail standards for its infrastructure as intercontinental rail traffic grows.

“Greenbrier-AstraRail is the leading designer and manufacturer of freight cars built to European rail standards. Greenbrier’s presence in Turkey, through its interest in Rayvag, continues its pursuit of growth by accessing global freight markets. Adding Rayvag to Greenbrier Europe, which also includes Poland’s WagonySwidnica and Romania’s AstraRail, extends Greenbrier’s continental reach. This allows Greenbrier Europe to acquire new railcar customers while also allowing it to serve existing customers that operate on the nearly 5,500-mile Turkish rail system (State Railways of the Republic of Turkey, Türkiye Cumhuriyeti Devlet Demiryolları, or TCDD). Despite strong rail penetration across the country, currently only 5% of Turkey’s freight traffic moves by rail, compared to an average 17% of freight transported by rail in Europe. The expanse of the Turkish rail system and Turkey’s strategic location between Europe and Asia makes it a prime location for freight rail growth.”

“Greenbrier views Turkey and the Mediterranean region as a key corridor within the global freight railway system,” said William A. Furman, Greenbrier Chairman and CEO. Expansion into Turkey is a logical extension of our market-leading Greenbrier Europe operation. Turkey broadens Greenbrier’s presence in the region, where we are successfully working with Saudi Railway Company (SAR) on key rail projects and are planning to partner with other Gulf Cooperation Countries on railway supply needs in those nations. We look forward to growing our presence in the Turkish rail market and the opportunity to be a part of the industry’s growth within the region. Our investment in Rayvag further demonstrates our commitment to enter promising international railcar markets. This will produce greater shareholder returns as Greenbrier grows its leadership on four continents as a global manufacturer in the expanding worldwide freight railcar industry.”