Traxtion confirms R3.4bn rail investment to expand freight capacity

Traxtion has confirmed it is concluding a R3.4 billion rolling stock investment programme aimed at expanding freight rail capacity and supporting South Africa’s rail reform agenda. The programme includes R1.8 billion allocated to locomotives and R1.6 billion to wagons and is expected to address about 5 percent of the national freight rail capacity shortfall.

The company said the investment represents the largest private freight rail commitment in South Africa in terms of fleet size and value. The programme carries a minimum 60 per cent local content target and is projected to support 662 direct jobs during the build and deployment phases.

As part of the programme, Traxtion has acquired 46 Wabtec diesel-electric locomotives from KiwiRail in New Zealand. These include 42 U26C partly modernised locomotives and four C30-8MMI fully modernised units. Working with Wabtec, the 42 U26C locomotives will be upgraded to C30MEI specification with new 7FDL-EFI engines and Brightstar control systems. All upgrade work will be undertaken at Traxtion’s Rail Services Hub in Rosslyn.

The locomotives will be shipped to South Africa in four tranches between April 2026 and August 2027. Each batch will undergo a four-month modernisation process covering engine and control system upgrades, six-yearly services and repainting. Traxtion said the first upgraded locomotives are expected to enter service in the third quarter of 2026, marking the company’s entry into South African mainline operations.

“Private capital flows when government policies create confidence in the private sector to invest. This investment is our vote of confidence in South African rail and in the reform momentum we are seeing,” said James Holley, CEO of Traxtion. “Every additional locomotive we put to work lowers logistics costs, protects the road network, improves our environmental footprint, and most importantly, creates jobs in the upstream economy.”

Traxtion said the programme has been structured to maximise domestic industrial participation through local assembly, supplier development and skills transfer. The company added that it expects all wagons under the programme to be manufactured locally by existing suppliers, with a focus on serving high-demand bulk and container corridors and easing pressure on ports and key rail routes.

Traxtion is marking 38 years of operations with a growing footprint across the continent, supported by recent operational milestones and industry recognition. Over the past year, the company expanded activity in corridors including Angola, TAZARA and the Democratic Republic of Congo, while also receiving multiple industry awards for locomotive rebuilds, training and safety initiatives. The company said these developments reflect its long-term strategy of pairing capacity deployment with local skills development, maintenance capability and operational reliability across African rail networks.

The announcement comes as South Africa implements its rail reform framework, including the separation of infrastructure and operations and the establishment of economic regulation. “We welcome the progress to date and the leadership shown by the Department of Transport and the Interim Rail Economic Regulatory Capacity,” Holley said. “We are preparing to unlock significantly more in further investment. To unlock that, the next iteration of the Rail Access Agreement under the Network Statement must be fully bankable with service-level guarantees for awarded slots, balanced legal protections, and clear recognition of lender rights.”

Harith, a long-term investor in Traxtion, said the programme demonstrates the role of private capital in advancing rail reform. “This programme sets a new benchmark for how private investment, aligned with policy certainty and local value creation, can deliver transformative outcomes for South Africa and the continent,” said Sipho Makhubela, CEO of Harith.

Traxtion currently operates across 10 African countries and manages a fleet of more than 50 locomotives on long-term contracts. The company said experience on corridors such as TAZARA and in the Democratic Republic of Congo shows that third-party access regimes can drive higher rail volumes when supported by viable commercial frameworks.

“These results are repeatable when the business case is right. South Africa can capture the same benefits, like more tonnage on rail, lower system costs, and stronger industrial spillovers, if we keep momentum on reform, access, and the planned infrastructure PSPs,” Holley said.

The R3.4 billion programme forms part of a wider R5 billion private sector commitment signalled at the launch of the National Rail Policy in 2022. Traxtion said it expects broader economic effects across mining, agriculture, manufacturing and export logistics as freight shifts from road to rail.

“Rail is a network industry. When trains move efficiently, the whole economy moves. This programme is about getting South Africa’s freight system working for growth and proving that private-sector investment, aligned with reform, can deliver fast, measurable gains for the country and the region,” Holley said.