Three-year procurement consulting project to connect Korean suppliers with Philippine rail market
Korea Railroad Corporation (KORAIL) is expanding its role in the Philippines’ Metro Rail Transit Line 7 (MRT-7) project from operations and maintenance to the procurement of maintenance parts, creating new opportunities for Korean railway suppliers to enter the Philippine market.
KORAIL said on Sept. 30 that it has secured an additional contract to provide procurement consulting services for MRT-7 maintenance parts.
The contract follows an approximately 120 billion won operations and maintenance (O&M) agreement signed with Philippine conglomerate San Miguel Group in April last year.
MRT-7 is an urban railway line being developed by San Miguel in Metro Manila. Under the new contract, KORAIL will support the establishment of a maintenance-parts procurement system needed for the railway’s operations after opening.
Building a Procurement System for the First Three Years
KORAIL will provide consulting services during the first three years of MRT-7 operations, helping San Miguel establish a structured procurement system and strengthen its own sourcing capabilities.
The project will cover the full procurement process, including purchasing plans, technical specification reviews, supplier identification, quotation and contract reviews, pre-shipment inspections, local inspections and technical consulting.
A stable supply of maintenance parts is essential for long-term railway operations, particularly across rolling stock, electrical and mechanical systems.
San Miguel plans to purchase maintenance parts from domestic and international suppliers throughout its 25-year operation of MRT-7. In the second half of this year, it plans to pursue approximately $4 million worth of procurement contracts involving around 20 suppliers.
Opening Opportunities for Korean Rail Suppliers
The project is also expected to provide Korean railway parts manufacturers with a direct route into the Philippine rail market.
KORAIL plans to identify qualified Korean suppliers and connect them with San Miguel, supporting their participation in the MRT-7 maintenance supply chain.
In July, KORAIL held an MRT-7 maintenance procurement briefing attended by more than 30 Korean railway parts companies. The event included one-on-one business meetings between Korean suppliers and San Miguel executives.
KORAIL will continue to support Korean companies throughout the procurement process, including quotation and contract reviews as well as quality inspections of manufactured parts.
Expanding Overseas Rail Business Beyond O&M
The additional contract broadens KORAIL’s overseas railway business beyond traditional operations and maintenance into procurement and supply-chain management.
The model could also create longer-term export opportunities for Korean railway companies. Overseas rail projects generate recurring demand for replacement and maintenance parts over decades of operation, allowing Korean suppliers to participate beyond the initial construction phase.
“This contract expands our involvement in Manila MRT-7 from operations and maintenance into procurement while supporting Korean railway companies in entering overseas markets,” KORAIL President Kim Tae-seung said. “We will use our expertise in railway operations and maintenance to create more export opportunities and broaden overseas sales channels for Korean companies.”
