Why Is Railfreight So Expensive?

[edwin_m]

What's this single charge then? Firstly, you have the VOSA fee, then insurance for the lorry. Don't forget the MOT and VED either. It all adds up ....

My dad used to run his own lorry, and his expenses (including fuel) were between twenty and twenty five thousand pounds a year, so it's not as cheap or as easy as some people here make out ....

If that includes fuel, and the mileage is what you'd expect a full-time driver to do in a year, then it's well under £1 a mile, plus obviously the driver's wages and a return on capital. I believe rail operators charge in the region of £50 per container transported, which would be consistent with the breakeven distance for rail being somewhere over 100 miles.

 

[Beveridges]

I don't think Railfreight has done anything but struggle since the demise of Loadhaul, Transrail, Mainline, RfD, Res and the takeover of EWS.

Coal trains are now moving further than before due to coal being imported. That screws the statistics up and makes it look like there has been a huge upturn in coal.

Other types of traffic have decreased - certain types in particular (royal mail and wagonload / "enterprise") almost completely disappear! - but we also have seen FOC's such as Fastline Freight / Victa West Link / Fragonset Freight / Advenza Freight Ltd go out of business altogether and lose everything! The freight went with them!

On the opposite we have seen DRS / GBRf / Colas Rail / Freightliner Heavy Haul grow to where they are today but most of their traffic came from EWS / DB Schenker - very little of it came from the roads!

DB Schenker is a small fraction of the size it used to be in the early EWS days when Loadhaul / Mainline / Transrail / RfD / Res were merged together, so much traffic has been lost, many marshalling yards that were once so busy are now so quiet they look like they have closed down, Warrington Arpley for one.

 

[CockneySparrow]

One thing to note is that there are two types of container shipments, one being FCL (Full Container Load) which means the whole container is for one end user, the second LCL (Less Container Load) which means even though that container maybe full it could have at least 10 different end users cargo on it
--- old post above --- --- new post below ---

What's this single charge then? Firstly, you have the VOSA fee, then insurance for the lorry. Don't forget the MOT and VED either. It all adds up ....

My dad used to run his own lorry, and his expenses (including fuel) were between twenty and twenty five thousand pounds a year, so it's not as cheap or as easy as some people here make out ....

I don't think Railfreight has done anything but struggle since the demise of Loadhaul, Transrail, Mainline, RfD, Res and the takeover of EWS.

Coal trains are now moving further than before due to coal being imported. That screws the statistics up and makes it look like there has been a huge upturn in coal.

Other types of traffic have decreased - certain types in particular (royal mail and wagonload / "enterprise") almost completely disappear! - but we also have seen FOC's such as Fastline Freight / Victa West Link / Fragonset Freight / Advenza Freight Ltd go out of business altogether and lose everything! The freight went with them!

On the opposite we have seen DRS / GBRf / Colas Rail / Freightliner Heavy Haul grow to where they are today but most of their traffic came from EWS / DB Schenker - very little of it came from the roads!

DB Schenker is a small fraction of the size it used to be in the early EWS days when Loadhaul / Mainline / Transrail / RfD / Res were merged together, so much traffic has been lost, many marshalling yards that were once so busy are now so quiet they look like they have closed down, Warrington Arpley for one.

Schenker was working on a project to move their European road cargo by rail from the UK a year or so back, not sure how that's coming on

I wouldn't read too much into the difference from the EWS days to now the Schenker of today, like any takeover changes happen the new owners look to work smarter hence some rail yards not seeing much traffic, doesn't mean cargo has dropped

 

[Moonshot]

How do you assess track access charges?

Freight trains are obviously long and heavy, so only right that they have higher charges than for a typical DMU/ EMU.

There would certainly be a lot of complaints from TOCs if freight companies were getting discounted paths.

"Getting lorries off the road" ticks a lot of boxes in terms of green credentials/ public opinion (i.e. fewer trucks for them to deal with on motorways), of course, but at what cost?

I just so happen to have the Network Rail Charges Schedule!!! This is quite a complicated document, but in general freight only pays the avoidable cost of running a train, it has no interest in the fixed charge element which TOCs pay. The actual detail of charge relates to type of wagon and locomotive used, the heavier the vehicle the more they are charged . This is to cover wear and tear, it even goes into detail of pressure applied against the radii of a curved rail.!! As I mentioned earlier , in general freight trains only run when there is a customer, though there are some regular paths on contract.

Freight charging regime is currently the subject of an ORR project, and indeed the 2 head honchos from the ORR were asked to appear before the TSC not so long back to explain what they were doing. Companies such as Freightliner submitted evidence to this enquiry as well.

Its also worth noting that the TABS team ( Track Access and Billing ) was actually based at Square One in Manchester when I was there, but not sure if they are now in Milton Keynes.

 

[BantamMenace]

will we ever get to a stage where we offer a drive up and board type system where a lorry carrying a curtain-sided container, such as the tesco one, rolls up and is transferred onto a timetabled freight train that is going to its desired destination. Surely these sort of facilities one for county/city/region would generate enough custom to provide atleast one service between each hub per day. A scotland originating train could even stop at many of these inland ports on it's journey to the south or wales.
If a heavy tax were induced upon lorries travelling over a certain distance it would make these facilities and services a damn sight more attractive as well.

Complete blue sky thinking though i admit

 

[Moonshot]

will we ever get to a stage where we offer a drive up and board type system where a lorry carrying a curtain-sided container, such as the tesco one, rolls up and is transferred onto a timetabled freight train that is going to its desired destination. Surely these sort of facilities one for county/city/region would generate enough custom to provide atleast one service between each hub per day. A scotland originating train could even stop at many of these inland ports on it's journey to the south or wales.
If a heavy tax were induced upon lorries travelling over a certain distance it would make these facilities and services a damn sight more attractive as well.

Complete blue sky thinking though i admit

Isnt that what happens through the Channel Tunnel?

 

[BantamMenace]

i had completely overlooked that, i suppose it is with the exception that the chunnel can support a whole lorry and doesnt require a mass purchasing of different trailers and curtainsided containers due to the uk loading gauge

 

[HSTEd]

Need the AAR plate H loading gauge, basically need new build lines

 

[Freightmaster]

What concerns me are the freight terminals that have closed...

In almost all cases over the past ten years, intermodal terminal closures
have been due to consolidation of traffic to fewer terminals to save costs
rather than outright losses to road.

In such cases, other terminals get busier, so the overall number
of containers moved by rail stays (roughly) the same.


The reason why some traffic flows 'fizzle out' is because they are
usually speculative moves by the FOCs/shipping compaines to try
and set up a new flow, and are often run at a loss for several months
in the hope that traffic will build to a point where a profit can be made,
but unfortunately in most cases, the traffic stagnates, so the train
is withdrawn - that is what happened with the flows from Teesport
to Mossend, Trafford Park and more recently Ditton; they were all
speculative flows, but the expected business just didn't materialise,
so the trains all bit the dust.

It doesn't mean that railfreight is too expensive, or that lorries
are too cheap - it's just that some traffic flows simply are not
suited to moving by rail while others are, and it sometimes takes
a bit of trial and error to find out which are which - the hard way!

But in the scheme of things, the loss of a few marginal, obscure flows
is irrelevant - the overall number of containers moving by rail is far greater
now than at any time since I started compiling Freightmaster, 19 years ago! hock:


MARK

 

[ex-railwayman]

will we ever get to a stage where we offer a drive up and board type system where a lorry carrying a curtain-sided container, such as the tesco one, rolls up and is transferred onto a timetabled freight train that is going to its desired destination. Surely these sort of facilities one for county/city/region would generate enough custom to provide atleast one service between each hub per day. A scotland originating train could even stop at many of these inland ports on it's journey to the south or wales.
If a heavy tax were induced upon lorries travelling over a certain distance it would make these facilities and services a damn sight more attractive as well.

Complete blue sky thinking though i admit

You mean a rolling highway, a Roll on Roll off system for HGV's and the likes, errrm no, not in this country, too many low bridges, tunnels, signal and catenary gantries, etc, that's why we've never seen double-stacked container trains in the UK.
Having travelled extensively across Europe I always like to see these trains going along. I was amazed to see one in India a few years ago and having read the Wikipedia page it's on the increase over there.

http://en.wikipedia.org/wiki/Rolling_highway

http://en.wikipedia.org/wiki/Konkan_Railway_Corporation

I wasn't too sure about the comment made earlier in this thread about container lifts being a contributing factor to the financial issue, to lift a container when I worked for Freightliner in the 70/80s cost 5 quid, by todays standards it may only be 25/30 quid, not a great deal shaker I wouldn't have thought.

Cheerz. ex-railwayman.

 

[Lankyline]

if its losing share as you say, then why is it that Dubai World Ports recently opened a new terminal in east London? Why would Peel Group want to build Port Salford as well as enhance the capacity in Liverpool?

I know Liverpool is on a seperate thread, but Peel are also using a ship to transfer containers from Liverpool to salford via the Ship canal, future freight rail capacity to these two areas is at the present questionable regarding volume.

 

[Johnny_w]

I'm sure I read with interest that the FGW's weekly(?) fuel delivery to some depot or other
has now been transfered to road.

Personally I think that's nuts and if memory served it was down to high Track Acccess charges.

Just my 2p's worth -get it off the ruddy road and onto rail!

JW

 

[yorksrob]

I just so happen to have the Network Rail Charges Schedule!!! This is quite a complicated document, but in general freight only pays the avoidable cost of running a train, it has no interest in the fixed charge element which TOCs pay. The actual detail of charge relates to type of wagon and locomotive used, the heavier the vehicle the more they are charged . This is to cover wear and tear, it even goes into detail of pressure applied against the radii of a curved rail.!! As I mentioned earlier , in general freight trains only run when there is a customer, though there are some regular paths on contract.

Freight charging regime is currently the subject of an ORR project, and indeed the 2 head honchos from the ORR were asked to appear before the TSC not so long back to explain what they were doing. Companies such as Freightliner submitted evidence to this enquiry as well.

Its also worth noting that the TABS team ( Track Access and Billing ) was actually based at Square One in Manchester when I was there, but not sure if they are now in Milton Keynes.

That's an interesting point.

So if you have a regional railway, which has passenger and freight trains which requires a large one off-investment - i.e. resignalling or a bridge rebuilding for example, even though the investment may be equally required by both passenger and freight to continue, the passenger service ends up paying proportionally much more because it runs trains more frequently.

The passenger railway then gets tarred with requiring a greater subsidy, and assumes all of the negative policy implications that this implies, when in reality, that subsidy is actually subsidising freight to a large extent.

 

[Buttsy]

will we ever get to a stage where we offer a drive up and board type system where a lorry carrying a curtain-sided container, such as the tesco one, rolls up and is transferred onto a timetabled freight train that is going to its desired destination. Surely these sort of facilities one for county/city/region would generate enough custom to provide atleast one service between each hub per day. A scotland originating train could even stop at many of these inland ports on it's journey to the south or wales.
If a heavy tax were induced upon lorries travelling over a certain distance it would make these facilities and services a damn sight more attractive as well.

Complete blue sky thinking though i admit

There was an attempt at this in the early 90s whereby wagons were built that could take a loaded HGV trailer (wheels and all) and be within guage to save the cost of trans-shipment. Pedigree Pet Foods trialled it but it was effectively 'spiked' by the road haulage industry lowering prices so that it became uneconomic to transport goods this way.

 

[edwin_m]

I've read in the past that a lot of former miners etc used their redundancy money to buy a truck and set themselves up as one-man operators. As they only needed to see themselves through to retirement they didn't need to build up a fund for replacement of the vehicle and could charge very low rates. If this was ever the case, maybe 20 years on it no longer is.

 

[Moonshot]

That's an interesting point.

So if you have a regional railway, which has passenger and freight trains which requires a large one off-investment - i.e. resignalling or a bridge rebuilding for example, even though the investment may be equally required by both passenger and freight to continue, the passenger service ends up paying proportionally much more because it runs trains more frequently.

The passenger railway then gets tarred with requiring a greater subsidy, and assumes all of the negative policy implications that this implies, when in reality, that subsidy is actually subsidising freight to a large extent.

Indeed Rob....and in fact pretty much the same point came across at the TSC session I saw about 12 month ago. Though overall the subsidy is falling and has been for some time now. FOCs do get charged for the freight only lines though.

 

[yorksrob]

Indeed Rob....and in fact pretty much the same point came across at the TSC session I saw about 12 month ago. Though overall the subsidy is falling and has been for some time now. FOCs do get charged for the freight only lines though.

To be fair, I'm not against subsidising rail-freight. There are good environmental/road safety/planning reasons for carrying freight on rail which aren't reflected in a straight forward road v rail cost comparison. I would just rather this were attributed more honestly to take some of the heat off of the regional passenger railway.

 

[HSTEd]

Attempting to cram more and more freight into a railway as cramped as the British one is never gonig to be able to compete without huge subsidies.
Many people drastically overstate the costs of road based freight transport in an attempt to hide this fact.
New build lines would have a huge capital cost but are the only option in the long term really.

 

[TheGrew]

What gauge was Great Central Main Line built to? I wonder if it could be converted to a rolling highway arrangement. I know there have been suggestions to re-open it as a freight only route.

 

[Moonshot]

To be fair, I'm not against subsidising rail-freight. There are good environmental/road safety/planning reasons for carrying freight on rail which aren't reflected in a straight forward road v rail cost comparison. I would just rather this were attributed more honestly to take some of the heat off of the regional passenger railway.

I think u have to look at subsidy in a different light.....UK taxpayer is putting in some £4 billion per year. If you take it that the TOCS effectively subsidise themselves , then the money the taxpayer is putting in is acually pure investment. However as far as Network Rail goes, the divisions between OPEX and CAPEX are very blurred.....its not easy to split out CAPEX and actually work out if there is a genuine return both financially and with wider economic benefits etc.

NR themselves made a point not so long back that they actually spend £2.3 billon with SMEs, so you could argue that 60% of the subsidy put in is actually supporting small businesses.

 

[yorksrob]

I think u have to look at subsidy in a different light.....UK taxpayer is putting in some £4 billion per year. If you take it that the TOCS effectively subsidise themselves , then the money the taxpayer is putting in is acually pure investment. However as far as Network Rail goes, the divisions between OPEX and CAPEX are very blurred.....its not easy to split out CAPEX and actually work out if there is a genuine return both financially and with wider economic benefits etc.

NR themselves made a point not so long back that they actually spend £2.3 billon with SMEs, so you could argue that 60% of the subsidy put in is actually supporting small businesses.

I don't think you'll ever get a completely realistic split between revenue and capital spend on the railway as a component that might wear out the before it was due to be replaced as a capital project would presumably suddenly become a revenue project.

I'm quite happy to look at the subsidy as pure investment, I just don't trust the powers that be to. After all, it's only a couple of years since the McNulty report managed to shift all the blame for subsidy on (Surprise It's Cilla 'ere) the regional passenger railway. Railfreight was, of course, portrayed as (largely) subsidy free.

Even when we try and work out whether there will be a return for an investment, we aren't very good at it. I can remember not long ago a transport minister saying that the North couldn't justify new trains because they supposedly wouldn't recoup their costs due to low fares in the PTE's (even though quite a lot of the North isn't in a PTE area). No consideration of wider economic benefits at all, and given our propensity to rent rolling stock for the whole of its existence, I don't see how its not going to pay for itself financially anyway.

Perhaps when trying to work out the economic benefits of the infrastructure, we ought to try and work out what the cost to the economy would be of it not being there !

I agree entirely with the point about using SME's. We seem to forget that the more times a sum of money is spent within the country, the more value it adds to the economy.

 

[daccer]

Railfreight could be construed as expensive by many potential customers due to the lack of a less than trainload (or wagonload) option. When Speedlink was thrown away and wagon load freight run down in the 80's and 90's the losses were pretty insignificant when compared to the kinds of numbers being invested in the current network. Pretty ironic that it was let go just before the Tunnel opened which could have provided a boost due to the much longer distances possible for traffic when mainland Europe was the destination.

If you are a potential new client using rail is only an option if you can utilise a full train or can containerise and truck to the nearest container depot.

The rolling road concept will come into play even though HS1 is the only option at the moment for gauge clearance. Concentration of trailers in Europe and railing to Barking for roading onto final destination will still be viable providing the European leg is of sufficient length. I have also seen proposals for a new freight route which would clear capacity on the WCML at a fraction of the cost of HS2.

 

[CockneySparrow]

That's an interesting point.

So if you have a regional railway, which has passenger and freight trains which requires a large one off-investment - i.e. resignalling or a bridge rebuilding for example, even though the investment may be equally required by both passenger and freight to continue, the passenger service ends up paying proportionally much more because it runs trains more frequently.

The passenger railway then gets tarred with requiring a greater subsidy, and assumes all of the negative policy implications that this implies, when in reality, that subsidy is actually subsidising freight to a large extent.

One point to make is that road freight isn't the flavour of the month due to green policies and congestion, therefore the government through NR are encouraging rail freight hence the lower fees

 

[Moonshot]

I don't think you'll ever get a completely realistic split between revenue and capital spend on the railway as a component that might wear out the before it was due to be replaced as a capital project would presumably suddenly become a revenue project.

I'm quite happy to look at the subsidy as pure investment, I just don't trust the powers that be to. After all, it's only a couple of years since the McNulty report managed to shift all the blame for subsidy on (Surprise It's Cilla 'ere) the regional passenger railway. Railfreight was, of course, portrayed as (largely) subsidy free.

Even when we try and work out whether there will be a return for an investment, we aren't very good at it. I can remember not long ago a transport minister saying that the North couldn't justify new trains because they supposedly wouldn't recoup their costs due to low fares in the PTE's (even though quite a lot of the North isn't in a PTE area). No consideration of wider economic benefits at all, and given our propensity to rent rolling stock for the whole of its existence, I don't see how its not going to pay for itself financially anyway.

Perhaps when trying to work out the economic benefits of the infrastructure, we ought to try and work out what the cost to the economy would be of it not being there !

I agree entirely with the point about using SME's. We seem to forget that the more times a sum of money is spent within the country, the more value it adds to the economy.

That is a valid point....and I have seen some Leeds University research on lesser used lines. They have a Professor Nash there who makes regular appearances in front of the TSC with submitted evidence....very clever man.

 

[CockneySparrow]

Railfreight could be construed as expensive by many potential customers due to the lack of a less than trainload (or wagonload) option. When Speedlink was thrown away and wagon load freight run down in the 80's and 90's the losses were pretty insignificant when compared to the kinds of numbers being invested in the current network. Pretty ironic that it was let go just before the Tunnel opened which could have provided a boost due to the much longer distances possible for traffic when mainland Europe was the destination.

If you are a potential new client using rail is only an option if you can utilise a full train or can containerise and truck to the nearest container depot.
.

No, in most cases less than a container load is charged to customers pro rata, trust me freight companies will fill that same container with several LCL shipments to make a full container, in fact the freight companies will make more money than one full container by charging multiple customers pennies more

 

[yorksrob]

One point to make is that road freight isn't the flavour of the month due to green policies and congestion, therefore the government through NR are encouraging rail freight hence the lower fees

That's great, just so long as that utility is accounted for and acknowledged.
--- old post above --- --- new post below ---

That is a valid point....and I have seen some Leeds University research on lesser used lines. They have a Professor Nash there who makes regular appearances in front of the TSC with submitted evidence....very clever man.

Sounds interesting. Is any of this in the public domain ?

 

[Moonshot]

That's great, just so long as that utility is accounted for and acknowledged.
--- old post above --- --- new post below ---


Sounds interesting. Is any of this in the public domain ?

yes ....when I remember where the link is, I ll post it.

 

[CockneySparrow]

That's great, just so long as that utility is accounted for and acknowledged.
--- old post above --- --- new post below ---


Sounds interesting. Is any of this in the public domain ?

Just found this online http://assets.dft.gov.uk/publicatio...change/strategic-rail-freight-interchange.pdf

Although page 5 doesn't mention any costs it points out the government wants the lorries off of the road

 

[HSTEd]

What gauge was Great Central Main Line built to? I wonder if it could be converted to a rolling highway arrangement. I know there have been suggestions to re-open it as a freight only route.

I am afraid the loading gauge of the Great Central Main Line is completely worthless for freight use.
The minimum viable loading gauge for large scale railfrieght is the Channel Tunnel loading gauge I'm afraid, you might want to go for full blown AAR Plate H with its full 20'3" clearance though to enable double stack high cubes if you ever need to do that. (They won't currently fit in the Chunnel but this is a long run project and increasing vertical clearance by 5% is not going to do much to the pricetag on a new line)

Then you can do a viable rolling highway, complete with shuttle style drive on-drive off and TOFC services on flat wagons.

Essentially this is another case of go big or go home

 

[edwin_m]

The rolling highways in Austria and Switzerland are presumably only UIC gauge C? However many trailers in the UK are higher than European standard so maybe that wouldn't work here.

For reasons that aren't clear to me, the Channel Tunnel HGV shuttles have open frame walls and a roof. If this requrement didn't apply, as on said rolling highways, then UK-sized trailers could be carried on something smaller than Channel Tunnel gauge. I can't see any justification for anything as large as AAR H in this country.