How to support single-wagon transport without distorting competition?

2023/02/23 at 7:25 AM
Tags: ERFA

Discussions are underway in several European countries on the restoration of single-wagon freight transport. It is considered, among others, public support for this purpose. The European Rail Freight Association (ERFA) believes that support for this mode of transport can play a positive role in the modal shift in transport, provided that it only concerns the last mile and does not distort competition in the rail market.

credit: Pixabay

Single-wagon transport in recent decades has been a form of rail transport, which in many European countries, including Poland, has been significantly reduced in favor of road transport. Many industrial plants have liquidated their sidings and resigned from rail transport because road carriers on many routes offer better transit time, lower costs and greater flexibility. For some companies, intermodal transport turned out to be more competitive and instead of incurring expenses for maintaining their own sidings, they prefer to deliver cargo to the nearest terminal, where it is reloaded onto a train. Unfortunately, in many cases, single-wagon transport has been replaced by long-distance road transport.

In several European countries, support is planned for the restoration of single-wagon transport in order to make better use of the railway infrastructure and relieve road congestion. The German government launched a support program for this type of transport in 2020. By the end of the year, it will allocate a total of EUR 600 million in the form of subsidies for enterprises to rebuild dispersed transport.

ERFA supports the idea of restoring single-wagon transport, but considers that the use of subsidies should be subject to transparent rules. The point is to ensure that the funding for the reconstruction of dispersed transport is not used to subsidize other forms of rail transport in which carriers compete with other rail operators. For this reason, the industry organization calls for subsidies to be limited to only the first and last mile, where rail will compete with car transport and where subsidies will contribute to a positive modal shift.

“The focus of support for SWT should instead be where it is most needed and of most use to the sector, namely the costly part of last mile and not for long-haul trains between marshalling yards. This means the focus of aid should be on a subsidy per maneuver (last mile service), especially for less used sidings (low volumes and frequency of service), as opposed to subsidies which support long-haul operations via SWT. That would also lead subsidies not only towards the incumbents but rather to all actors involved in rail freight.” said in EFRA’s statement.

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