Use of simulation in the initial assessment and testing of a rail vehicle has gained popularity in recent years with the advancement of computational power and software. However, there is a lack of guidance and approved methodologies for simulation in standards around the world. Though simulation is considered a vital tool, the use of physical tests for the acceptance/certification of a vehicle design still plays the most significant part. A better understanding of simulation methodology can reduce the requirement for costly, time consuming and potentially risky physical tests. In this paper, a new three stage methodology for investigating a wagon concept has been proposed to achieve the most suitable design in line with any mandatory requirements. The three stages are the development of the multibody model of the concept wagon, a train operation simulation to obtain the critical external forces acting on the wagon and a wagon dynamics simulation. A case study has been added to demonstrate the implementation of the proposed methodology. The simulated case study shows that simulation of wagon dynamic behaviour in multibody software, combined with data obtained from longitudinal train simulation, is not only possible, but it can identify issues with a wagon design that can otherwise be overlooked.