Train drivers employed by Rio Tinto to haul iron ore across Australia's outback make about the same money as surgeons in the US. It's little wonder the mining company will replace them with robot locomotives.

The 400-plus workers in the remote Pilbara region who earn about $240,000 a year probably are the highest-paid train drivers in the world, according to UK-based transport historian Christian Wolmar. Australia's decade-long mining boom has sucked up skilled workers, raising wages for engineers to drivers at Rio, the second-largest exporter of the mineral, and its closest competitors, Vale and BHP Billiton.

Lucrative road: Rio Tinto is planning to replace its highly-paid train drivers in the outback. Credit:Michele Mossop

The three companies that control about 59 per cent of the $145 billion-a-year ($155 billion) global iron ore trade are automating to bolster margins and squeeze out extra capacity as they boost supply to a record to feed steel mills in China, the biggest buyer. The push by Rio, which aims to move about 290 million metric tonnes on its rail network by next year, is expected to be the biggest driver for cost cuts in its iron ore unit after currency swings, according to Deutsche Bank AG.

"All producers are chasing better margins and stronger returns," said Chris Drew, an analyst in Sydney with Royal Bank of Canada. "Rio is ahead of the competition in terms of automation of trucks and trains," Drew said in an interview after touring its ore operations in the mostly arid Pilbara, home to Western Australia's biggest deposits for export.