Australian rail industry survey reveals COVID-19 support priorities

A survey undertaken by the Australasian Railway Association (ARA) of Australian rail suppliers, contractors and freight operators has found that maintaining current projects was the most important action governments could take to support the rail industry during the COVID-19 pandemic, emphasising that governments must keep the focus on progressing infrastructure projects in order to ensure the quickest post-pandemic economic recovery.

However, the survey also uncovered new opportunities for local business and industry, with three quarters of businesses that are planning changes to their supply chain subsequently expecting to increase their use of local suppliers.

Chief Executive Officer of the the Australasian Railway Association, Caroline Wilkie, said that respondents also wanted governments to fund additional stimulus projects and provide stronger policies to support local content and more effective procurement processes as the industry plans to shift its focus.

Caroline said: “The rail industry has continued to operate through COVID-19 despite 86 per cent of survey participants having their supply chains disrupted by the pandemic. Many businesses are looking to change their supply chains in the future and this presents a real opportunity for Australian manufacturers and suppliers. This is the perfect time for governments to streamline procurement processes and boost local content policies to support the generation of new jobs in the rail supply chain.”

The survey found that 91 per cent of respondents were concerned about the impact of COVID-19 on all or part of their business. Respondents’ top three concerns were the financial impact on their operations, a slowing or reduction in government infrastructure projects and the potential for an Australian recession.

A quarter of respondents had experienced constraints on international shipments, while 22 per cent had seen a decline in customer spending. Just over half of respondents (53 per cent) planned to defer or cancel planned investment, with 68 per cent of those putting workforce expansions on hold and 65 per cent delaying capital expenditure. However, most expected these impacts to be short- to medium-term.

“Suppliers and contractors stand ready to bounce back quickly to support the recovery. A third of respondents could be back to full capacity within a month of the return to normal operations if the policy settings and project pipeline is right. That confirms the vital role rail will play in strengthening our recovery,” said Caroline.