To lead or to follow… innovation & collaboration in manufacturing

Stuart Thomson CEO – Rail Manufacturing CRC

www.rmcrc.com.au

Australian rail industry snapshot

150

years

330suppliers

15,000employees

15 OEM & global tier 1

1stlargest tram network

1,500firms

$4.2brevenue

6thlargest rail network

42,262 km of track

Source: A Profile of the Australian Rail Manufacturing Industry, ACIL Tasman for the Department of Industry, Innovation and Science, July 2011.

Supply Opportunity for Rail

Tier 1

Tier 2

Tier 3

Tier 1

Tier 2

Tier 3

Rail Manufacturing : ca. 88 % of revenue = Tier 1: ca. 90% of total businesses exist in Tier 3

Opportunities: Golden era = constant demandPrime opportunity for local companies to invest in the future via innovation

Examples: Innovation challengeCirque du Soleil used innovation in an old performance genre to create a $4B organisation

Kodak invented digital photography but did not capitalise on its own innovation

A number of Australian manufacturing entities are bucking the downsizing trend;Auto aftermarketMining; GroundProbe, SmartCapSoftware

SME Rail businesses like MRX, DTI, TTG, and new industry players like Keech, Air Radiators, Airlinx, real serious games etc

Innovative, nimble, and flexible.

To lead, or to follow… The OECD Science, Technology and Industry Scoreboard 2013

found that Australia ranked the lowest in the OECD for collaboration on innovation with public research institutions.

Manufacturing is rapidly changing – new technology, new materials, robotics and automation

Government helps businesses innovate through CRCs programme, R&D tax concession, other industry assistance & grant programs

Innovation is now an Australian Government priority: Industry Growth Centre into Advanced Manufacturing Innovation Policy Statement in December with new initiatives

Innovation challenge for rail Rail is a globally competitive industry Innovation is key to production efficiency and wealth creation Innovative Australian businesses that collaborate are:

23 per cent more likely to report increased productivity24 per cent more likely to report increased profitability24 per cent more likely to employ more people

Rail manufacturing in Australia has low levels of innovation compared to other sectors and other countries

Less than 1% of those working in rail have R&D or science expertise Many rail businesses lack dedicated R&D resources in-house to bring

innovation to business

• 210 participants from over 110 different organisations in the rail industry - launched in June 2012

• Identified 18 Priority Opportunities out of 80 needs for competitive technologies that would help position the Australian rail industry to better meet the needs of global customers

• 22 Strategic Recommendations, including:

Australia needs a rail manufacturing CRC

Six enablers:• Governance• Standardisation &

Regulation• Funding• Research• Policy• Collaboration

• Research

Consultation within rail industry

Why a Rail Manufacturing CRC?

You – the Rail Industry – said it was a priority – On Track 2040 identified need for a research organisation for Rail Manufacturing

Rail manufacturing identified technological challenges to solve to remain viable and competitive, such as: • Efficient operations through increased industry capacity and reliability

(quality) • Quality service through customer information, product delivery and

increased safety• Efficient systems by essentially increasing productivity and process

sustainability through reducing costs, lowering emissions, and limiting external impacts

Cooperative Research Centres bring business and innovation together through collaboration on projects to develop new solutions, products and processes

Our funding model

R&D PROJECTS

RMCRCAustralian Government funding

of $31 million x 6 years

Research Providers“In-kind”

(research expertise & facilities)

Industry50:50 co-funding

and “In-kind”

RMCRC model

RMCRC

R&D Providers

Rail Industry

• Collaboration• Innovation• Integration &• Globalisation

Industry determines whether to;“Compete on price” or “Compete on value”

Both options can be innovation and driven

1. Power & Propulsion

• Energy regeneration and storage

• Advanced braking systems

• Electronic motors and systems

2. Materials & Manufacturing

• High performance materials for rail

• Advanced manufacturing

• Lightweight materials• Low cost

manufacturing systems

3. Design, Simulation & Modelling

• Advanced design and simulation

• Automated health monitoring

• Advanced data analysis

• Energy use management tools

Strategic Research Themes

Our Essential Participants:

RMCRC Membership Benefits:

Solve your technical challenges with access to

the latest research

Access Australia’s leading research engineers,

scientists with expertise to help solve your technical

problems

Become a leader in innovation for your

businessGain from RMCRC’s

commercialisation model

Share the risk of R&D by participation in co-

funded research projects