DBS making £5m per month loss?

[daccer]

There might be a general nashing of teeth over this but DBS stopped long ago relying on running trains to make cash. Over a period of time they have disposed of numerous sites as well as hundreds of locos and thousands of wagons. Last year they pocketed multi millions from Network Rail for handing back leases on underused sites.

All predictions for railfreight point to big increases in overall volumes In the years ahead and this is with the decline in coal factored in as it was well known.

On thing about the current coal dropoff does perplex me. If the power stations have been stockpiling coal then in theory this meant traffic levels were increased before April 1st. The fact they have now dropped off is surely only a temporary issue whilst the stockpiles are sorted out. Over the year there would in theory be no difference in tonnages moved. Also I believe that it takes double the amount of biomass to coal to generate the same energy levels.

The worry for DBS is surely that their recruitment policy is too short sighted and rather than take a long term view they have tied themselves to the cyclical nature of the industry too tightly and will be forever recruiting or laying off. Maybe not the best way to run such a business.

 

[Kevin_Brum12]

5 million a month not 5 million a week!

Still a huge loss though to turn around.

 

[RichmondCommu]

All predictions for railfreight point to big increases in overall volumes In the years ahead and this is with the decline in coal factored in as it was well known.

I keep reading this but I've yet to see any hard evidence. I'm afraid all too often I'm reading about freight flows that have ceased / one off trials rather than brand new business that has been won from road freight haulage companies.

Still a huge loss though to turn around.

Well yes but taking locos off lease and redundancies will soon start to see costs reduced. The very fact that class 92's are now being leased to other European operators suggests that DBS are starting to look at their cost base.
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Thanks for that. Interesting stuff. I guess it all comes down to one of the distinct failings of the Channel Tunnel to boost rail freight. Admittedly there are some flows which come from Dollands Moor having been through the tunnel such as the regular working to and from Scunthorpe and the one a day via HS1 to Ripple Lane plus the other bits to Hams Hall, Daventry, Margam, Irvine, Wembley, Trafford Park and Ditton but overall it's not teeming with freight.

I concur and indeed I've often mentioned on this forum that more needs to be done to increase the amount of freight running through the Channel Tunnel. The problem is most of our trade with the rest of Europe goes through Rotterdam and Hamburg. I do think its a real shame that Nissan and Toyota are not interested in using rail freight to export their cars to Europe and beyond but I dare say they have their reasons.

 

[Harlan Cage]

DBS which is effectively run by the German Government and has extracted a lot of profit from the UK over the years and now business is not so good due to change in traffic flows and more competition. So the Privatisation of the freight network in the UK is working which means some companies are making good profits whilst others may not be doing so well. If only the passenger network in the UK had real competition maybe services would be better.

HC

 

[misterredmist]

You have to bear in mind that Germany has a much stronger manufacturing base which will always result in more freight traffic. It's also worth mentioning that thanks to international freight traffic the distances traveled in Germany are much greater for exports to the rest of Europe. If you look at many of the freight flows in the UK all too often road haulage is more competitive in terms of price and journey times. As an example Felixstowe to London is too short to make rail freight viable. Its a real shame but sadly its true

Whilst Germany is a larger nation, with greater distance between cities, and through routes by barge on the Rhein and Rhein / main / Donau canals, rail has always been an important factor and was protected for many years from road competition by the "RKT" tariff ...though this has now gone, there is still protection with a Sunday driving ban for heavy vehicles and a Saturday ban too during the Summer.......more importantly though, I believe the Germans have a long term strategy, whereas our culture is just short term profits and sod the consequences tomorrow brings........ a proper mind set would put more work on the rail, particularly unit loads , but there's just no will to attempt to implement it............

 

[DeeGee]

more importantly though, I believe the Germans have a long term strategy, whereas our culture is just short term profits and sod the consequences tomorrow brings........ a proper mind set would put more work on the rail, particularly unit loads , but there's just no will to attempt to implement it............

That's a German cultural thing. It explains why Aldi, which has a business plan built around sustainable long-term growth first and foremost, is thriving, while Tescos, which has a business plan built around abstracting the maximum possible profit to produce the largest possible dividend instantly, is losing money hand over fist.

 

[Dr_Intoxicated]

The worry for DBS is surely that their recruitment policy is too short sighted and rather than take a long term view they have tied themselves to the cyclical nature of the industry too tightly and will be forever recruiting or laying off. Maybe not the best way to run such a business.

Still it keeps the boys and girls in HR busy and means there is no fear of them loosing their jobs

 

[The Crab]

That's a German cultural thing. It explains why Aldi, which has a business plan built around sustainable long-term growth first and foremost, is thriving, while Tescos, which has a business plan built around abstracting the maximum possible profit to produce the largest possible dividend instantly, is losing money hand over fist.

I think you'll find that although Tesco made a huge loss through (mainly) property revaluations, it's trading profit last year was something over £1bn.

 

[WatcherZero]

According to ORR freight traffic is up 9% on 2003 so there is the work there.

 

[Smudger105e]

But FL and DRS and Colas have a bigger share og the available traffic.

 

[Chrism20]

That's a German cultural thing. It explains why Aldi, which has a business plan built around sustainable long-term growth first and foremost, is thriving, while Tescos, which has a business plan built around abstracting the maximum possible profit to produce the largest possible dividend instantly, is losing money hand over fist.

I think you'll find that although Tesco made a huge loss through (mainly) property revaluations, it's trading profit last year was something over £1bn.

Indeed it only showed a bottom line loss as Dave Lewis kitchen sinked it. There was as the crab says a healthy profit on trading.

DBS surprises me as normally the Germans can make things work.

 

[class 9]

There might be a general nashing of teeth over this but DBS stopped long ago relying on running trains to make cash. Over a period of time they have disposed of numerous sites as well as hundreds of locos and thousands of wagons. Last year they pocketed multi millions from Network Rail for handing back leases on underused sites.

All predictions for railfreight point to big increases in overall volumes In the years ahead and this is with the decline in coal factored in as it was well known.

On thing about the current coal dropoff does perplex me. If the power stations have been stockpiling coal then in theory this meant traffic levels were increased before April 1st. The fact they have now dropped off is surely only a temporary issue whilst the stockpiles are sorted out. Over the year there would in theory be no difference in tonnages moved. Also I believe that it takes double the amount of biomass to coal to generate the same energy levels.

The worry for DBS is surely that their recruitment policy is too short sighted and rather than take a long term view they have tied themselves to the cyclical nature of the industry too tightly and will be forever recruiting or laying off. Maybe not the best way to run such a business.

Yes, up to April 1st we were very busy. Traffic will recover a bit but never back to levels seen before.
The carbon tax which more than doubled has now made coal generation uneconomic, coupled with low gas prices and the stocks will only be going down very slowly.
Regarding biomass, it is only railed into Drax where 2 of the 6 units have been converted and they are looking a the third. This is the only power station to convert, changes to subsidies have made plans to convert Eggborough and Rugeley to be shelved.

 

[Freightmaster]

Regarding biomass, it is only railed into Drax where 2 of the 6 units have been converted and they are looking a the third. This is the only power station to convert, changes to subsidies have made plans to convert Eggborough and Rugeley to be shelved.

There is also Ironbridge, but that was only ever intended to be
a short term project, and is expected to close down by the end
of this year, or early 2016 at the latest...

MARK

 

[SkinnyDave]

So what realistic markets are the likes of John Smith and senior Freight management looking at to buck this trend?
It seems as if supermarkets have recently told them to up their game if they want to seriously challenge road transport.

 

[class 9]

There is also Ironbridge, but that was only ever intended to be
a short term project, and is expected to close down by the end
of this year, or early 2016 at the latest...

MARK

Oh yes, forgot about that one, also there was Tilbury which I believe has already shut.

 

[6Gman]

There is also Ironbridge, but that was only ever intended to be
a short term project, and is expected to close down by the end
of this year, or early 2016 at the latest...

MARK

So are all those GBRf biomass hoppers going to be redundant soon?

(Well, a lot of them ... )

 

[Freightmaster]

So are all those GBRf biomass hoppers going to be redundant soon?

(Well, a lot of them ... )

Most of them will be needed for a new flow to Drax, possibly even before
the Ironbridge traffic ceases.

MARK

 

[Albatross]

So what realistic markets are the likes of John Smith and senior Freight management looking at to buck this trend?
It seems as if supermarkets have recently told them to up their game if they want to seriously challenge road transport.

The one area that Schenker are booming in is construction. They can barely cover the demand coming out of Peak Forest and it's supposedly the same across the board at the construction depots.

It's an odd one really as the drivers have a no redundancy agreement in place until April 2017 and yet the company are talking about 118 going.

There'll be plenty of volunteers if they ask for them but there's not actually been any mention of whether they're asking, just talk of depot closures.

Given the agreement they have I'm pretty sure ASLEF are going to stick to their guns and reject the whole thing outright but we shall see.

 

[Grumpy]

.

They then became a little too greedy, lost the Royal Mail contract which lost the majority of the work for the 67s. .

The 67's would have been used on the Willesden to Bristol service and the Warrington to Bristol service. All the rest (Warrington/ Glasgow, Doncaster/Tyneside, Norwich, Redhill) were 325. So that's say 4 locos. Nowhere near the "majority of work".

 

[the sniper]

The 67's would have been used on the Willesden to Bristol service and the Warrington to Bristol service. All the rest (Warrington/ Glasgow, Doncaster/Tyneside, Norwich, Redhill) were 325. So that's say 4 locos. Nowhere near the "majority of work".

I'm no expert on this, but I'm sure you're wrong. They were mainly intended for the Royal Mail contract and I know more than 4 locos were used each night! For a start Railnet didn't end at Bristol, it ran into South Wales and down to Penzance! There were also cross country trains (Low Fell to Bristol?).

For an example of how many 67s were booked to run just to/from Willesden alone in Dec 2002, here's a post from '33056' that I've had bookmarked for years: http://www.railforums.co.uk/showpost.php?p=538783&postcount=17

 

[BantamMenace]

I'm no expert on this, but I'm sure you're wrong. They were mainly intended for the Royal Mail contract and I know more than 4 locos were used each night! For a start Railnet didn't end at Bristol, it ran into South Wales and down to Penzance! There were also cross country trains (Low Fell to Bristol?).

For an example of how many 67s were booked to run just to/from Willesden alone in Dec 2002, here's a post from '33056' that I've had bookmarked for years: http://www.railforums.co.uk/showpost.php?p=538783&postcount=17

Thats an impressive list, do all the destinations such as Norwich, Dover, etc. still have large rail accessible mail facilities? If not it's useless saying we should restart the services as much as we'd like to.

 

[Grumpy]

I'm no expert on this, but I'm sure you're wrong. They were mainly intended for the Royal Mail contract and I know more than 4 locos were used each night! For a start Railnet didn't end at Bristol, it ran into South Wales and down to Penzance! There were also cross country trains (Low Fell to Bristol?).

For an example of how many 67s were booked to run just to/from Willesden alone in Dec 2002, here's a post from '33056' that I've had bookmarked for years: http://www.railforums.co.uk/showpost.php?p=538783&postcount=17

Fair comment, I cant argue with that. My memory playing tricks. However there seem to be 5 evening departures with 67's, so assume a similar number of up trains and at least one loco working from the SW to Warrington and back (possibly needs more than one loco) and you still haven't used half the fleet.

 

[LNW-GW Joint]

Most of them will be needed for a new flow to Drax, possibly even before the Ironbridge traffic ceases. MARK

Fiddlers Ferry has the OK until 2023 I believe, and can burn a mixture of coal and biomass.