Transnet advances rail reform with leasing company procurement milestone

Transnet has reached a major milestone in South Africa’s rail reform programme after issuing a Request for Proposals (RFP) to two shortlisted bidders for the establishment of a new rolling stock leasing company.

The development follows the successful completion of the Request for Qualification (RFQ) process, launched in April 2025, which attracted 14 submissions from interested parties.

The proposed leasing company, known as LeaseCo, will be responsible for acquiring, managing and leasing rolling stock to both domestic and regional rail operators. The initiative is aimed at addressing one of the rail sector’s most significant challenges: access to reliable rolling stock.

LeaseCo forms a key component of South Africa’s broader rail reform agenda, which seeks to modernise freight rail operations, encourage private sector investment and create greater participation opportunities within the rail industry. By improving access to rolling stock and increasing asset utilisation, the company is expected to support both established and emerging Train Operating Companies (TOCs), while contributing to economic growth and more resilient regional supply chains.

The business has been structured as an independently governed and commercially viable leasing entity. Under the proposed model, Transnet will contribute a ring-fenced fleet of rolling stock assets as equity, along with original equipment manufacturer (OEM) capabilities through its engineering division, Transnet Engineering. The selected private-sector majority partner will provide capital investment, operational expertise and technical capabilities to rehabilitate, manage and expand the fleet.

According to Transnet Group Chief Executive Michelle Phillips, strong demand for freight services and a shortage of available rolling stock have created a compelling opportunity for a dedicated leasing business.

“Significant unmet freight demand, driven by a shortage of available rolling stock, presents a compelling opportunity for a dedicated leasing entity,” Phillips said. “LeaseCo represents a transformative initiative primed to modernise Africa’s rail system, mobilise private capital and enhance the reliability of freight logistics.”

Transnet has already begun engaging with newly licensed train operating companies to assess their rolling stock requirements. The company has reportedly secured commitments from five operators interested in utilising LeaseCo’s services. Market demand is expected to increase further as the Transnet Rail Infrastructure Manager (TRIM) allocates additional network capacity to operators.

The issuance of the RFP marks another step in the government’s efforts to create a more competitive, efficient and inclusive rail sector. Industry stakeholders view the initiative as an important development in strengthening logistics performance, improving freight mobility and positioning rail as a key driver of South Africa’s economic competitiveness and regional integration.

For more information visit www.transnet.net

22nd June 2026