Railway Industry, Infrastructure & Mobility in Southeast Europe
Railway Industry,
Infrastructure
and Mobility
in SEE
Sector Overview
The railway sector in Southeast Europe is undergoing a fundamental structural transition from aging legacy systems into a modern, electrified, and digitized transit network integrated with the Trans-European Transport Network (TEN-T).
Supported by massive capital injections from the European Union and bilateral infrastructure agreements, the region is rapidly upgrading both passenger and freight corridors to connect Central European industrial hubs with Adriatic, Aegean, and Black Sea ports. Simultaneously, the region has developed a highly competitive rolling stock manufacturing and engineering base.
Global industry leaders and regional firms operate dedicated production facilities for light rail, battery-electric multiple units (BEMUs), and highly specialized rail components directly destined for European and global markets. T
o maintain momentum, regional stakeholders must execute complex, multi-year civil engineering projects while rapidly deploying the European Rail Traffic Management System (ERTMS) to resolve cross-border interoperability bottlenecks.
Stakeholders, Key Regional Investments & Projects
The sector is anchored by a mix of major global railway manufacturers, domestic rolling stock engineering firms, and massive state-backed infrastructure upgrades.
In Serbia, Siemens Mobility operates a major production hub at the MIND Park in Kragujevac, employing over 1,000 people. This facility specializes in manufacturing aluminum and steel rail vehicle components and complete Avenio trams, which are actively exported to cities like Bremen, Munich, Nuremberg, and Copenhagen. The Kragujevac campus also hosts a dedicated engineering hub delivering advanced services for global Siemens Mobility projects.
In Croatia, KONČAR – Electric Vehicles drives native technological advancement. The company produces 100% low-floor trams for domestic networks in Zagreb and Osijek, and has successfully commercialized new Battery Multiple Units (BMU) and Battery Electric Multiple Units (BEMU). Backed by National Recovery and Resilience Plan funding, Croatia officially launched regular service of its first KONČAR-produced battery-powered trains designed specifically for non-electrified lines. KONČAR also exports specialized rolling stock, delivering advanced self-propelled measurement trains to Italian rail systems specialist MER MEC S.p.A.
Broader regional manufacturing includes Alstom’s significant presence in Romania, providing Coradia Stream inter-regional trains and long-term maintenance for the Bucharest Metro fleet, alongside specialized freight wagon manufacturing by Greenbrier Astra Rail in Arad. Infrastructure modernization forms the bulk of regional capital deployment.
Croatia is executing a major investment cycle, which includes the flagship €620 million Dugo Selo – Novska double-tracking and upgrade project alongside the completion of the modernized Zagreb – Hungarian border railway line.
Concurrently, the multi-billion-euro Belgrade–Budapest high-speed rail line has reached physical track completion, entering cross-border operational testing to link Serbia and Hungary to the broader European high-speed network.
Further south, Greece and Bulgaria are cooperating on the Sea2Sea mega-project to create a rail freight bypass linking Greek Aegean ports directly to Bulgarian Black Sea and Danube ports.
Macro Growth Drivers & Future Outlook
The European Union’s decarbonization targets and the push to shift freight transport from road to rail serve as the primary catalysts for the sector. Initiatives such as the European ERTMS Deployment Plan and the Europe’s Rail Joint Undertaking are enforcing standardized digitalization and unified driver certification across borders.
The commercial rollout of electro-battery and hybrid trains across the region directly addresses the challenge of decarbonizing routes where full overhead electrification is economically unviable. Furthermore, the deployment of Digital Automatic Coupling (DAC) for freight operations will fundamentally increase network capacity and efficiency.
To capitalize on these drivers, regional operators and infrastructure managers must strictly adhere to project timelines to avoid EU funding absorption risks. Managing the severe shortage of specialized railway civil engineers and signaling technicians will be the determining factor in achieving a fully integrated, high-speed regional mobility network.