The UK government is investing more than £4 billion in rail freight over the next 10 years. As part of this investment fund, the Strategic Rail Authority in February announced a £22 million freight grant scheme to support intermodal containers by rail.
In comparison to this investment, the road haulage sector has received fuel duty increases in excess of three pence per litre over the last 12 months. This is a significant additional cost on top of the ongoing fees, training, and taxes incurred by the haulage sector.
The Road Haulage Association says these increases are out of keeping with European competition, leading to industry degradation, as European operators are able to cost effectively infiltrate the UK market.
The 52,000 road haulage companies in the UK carried over 149bn tonne kilometres of freight in 2003, whereas the five major rail freighters moved less than 19bn tonne kilometres, and 50 per cent of that freight was coal.
The annual rail freight in the UK is equivalent to 100,000 trucks, and is a long way from making a significant impact on the 425,000 trucks used to haul freight across across the country’s road network today.
The average freight train could remove 50 trucks from the UK’s roads. There are over 100,000 railway paths unused each year, which equates to 250 trains per day. With these statistics in mind, it is hard to imagine how the rail industry continues to make little headway in the conversion from road to rail.
Andrew Traill, head of Rail Freight Policy for the Freight Transport Association, says: “A study two years ago found that potential British rail freight users were turned away from rail freight because of a lack of trust, reliability, cost, poor attitude, quality of care and ease of business.”
The Strategic Rail Authority believes that rail freight improvement requires the facilitated development of a network of commercially viable rail freight interchanges. There is a need for the right facilities in appropriate locations to support the growth of freight on rail. The SRA is convinced this is vital in developing the national rail freight network, linking ports and the Channel Tunnel, and ensuring freight operators are properly connected to the infrastructure necessary for business growth.
Christian Costa, of Eurotunnel’’s freight division, believes the rail freight issues are not specific to the UK, and are much more widespread across Europe. Costa says: “Many clients are using alternative routes. The issues relate to gauge of wagons circulating in the UK, a limited type of electronic locomotive authorised to travel through the Tunnel, poor quality of service provided in France by SNCF, and service issues as a result of the problems of asylum seekers.”
Regardless of these issues, Traill believes the rail industry has taken on-board the messages and says: “There has been significant improvement in the service supplied by the rail freight industry and rail freight is on the increase”.
SRA figures support these statements, suggesting a domestic intermodal freight increase of six per cent, and commodities freight rising by around one per cent.
This recent increase in rail freight usage does not show signs of lasting, or delivering further increases in the medium term. Major road works across the UK have caused massive congestion problems at main junctions and central distribution systems, costing businesses in lost time and delays an estimated £15bn a year. Once completed however, there are indications that road freight will continue to dominate the import/export and distribution market.
Traill agrees, saying: “The recent increase is clearly related to the current problems in road traffic.”
In light of the problems associated with congested roads, the RAC Foundation has called for government action. British road users pay over £44bn a year in road taxes, however as little as £6bn is spent annually on road improvements and repairs.
Edmund King, executive director of the RAC Foundation has put forward a national road strategy to the government outlining an annual investment of £2bn a year for 10 years to relieve road congestion. King says: “We are concentrating on motorways and trunk roads which are only four percent of the road network, but carry 35 per cent of the national traffic including over half the road freight.”
The backbone of the government target to increase rail freight usage by 80 per cent before 2010 is that rail transport is good for the environment. The government and support groups suggest rail freight is good for congestion relief and environmental improvements through the reduction of CO2 emissions. Other public benefits include a decrease in road maintenance costs, fatalities, and noise and air pollution.
However despite government targets and soft funding, the rail industry continues to find itself without major infrastructural support.
In March 2004 the government announced that it would no longer be providing backing for the Liverpool-Lille Central Railway Project. The government did state however its continued commitment to the privately financed dedicated freight line from the Channel Tunnel to the North West of England.
These are major setbacks for the rail industry, however the issue of road verses rail freight is not solely related to old infrastructure and poor network connections.
As identified by a Freight Transport Association study two years ago, attitude plays a major role in the service industry - the can-do approach is so often lacking in the UK.
One company planning to overcome all the hurdles in rail freight is Europorte 2, a subsidiary company of Eurotunnel.
Europorte 2 was granted a French freight licence in February 2004, and intends to utilise existing freight corridors running between Basle and Dollands Moor. The first service is due to begin in 2005.
Costa, of Eurotunnel’s freight division, says: “With a view to becoming the driving force behind the development of cross-Channel rail freight, which has achieved insufficient results for the past several years, Eurotunnel decided to launch rail freight activities in Europe as soon as rail freight transport was deregulated in France, in March 2003.
“The company is preparing the safety certificates required for traffic using the French Network, the Channel Tunnel and Network Rail,” he adds. Europorte 2 aims to run over 300 freight trains per week by 2007.
Europorte 2 may well overcome all the issues, but it is an isolated interested party. Many road freight users plan to remain on the road unless there is radical change in rail freight costs, or alternatively the cost of road transport increases substantially.
One customer who is a firm road transport user is HSF Logistics. Tom Hunt of HSF Logistics says: “We are in the fresh product business, so speed of delivery is a major component in our freight delivery decision.” With fresh product arriving from Holland in refrigerated trailers, the cost of using rail transport would be prohibitive, as HSF would need to transfer product into containers. The Ferry terminals are also further away which would add to the cost.
Rail freight operates in a complex environment. The successful conversion of freight from road to rail brings together a network of commercial and operational relationships. Only through a co-joining of these relationships and political determination will significant infrastructual improvements be made, ensuring a cleaner and globally competitive future for the UK.