2
B ULK D ISTRIBUTOR
Rail & Intermodal
November/December 2019
A bright future for UK rail, says VTG
V
TG Rail UK is the largest private wagon
hire company in the UK. From offices in
Birmingham, in the English Midlands, a team
of 23 dedicated staff manage a fleet of more
than 2,000 wagons.
The firm is a subsidiary of Hamburg, Germany-
based VTG Group.
“We have wagons that service most sectors and
commodities that use rail,” Ian Shaw, sales and
marketing director, tells Bulk Distributor. “These
are loosely divided into three divisions that are
aligned with the VTG Group’s ‘Centres of
Competence’, namely tank, intermodal and
standard freight - the latter being a catch all for
the multitude of other wagon types that exist. We
have wagons suitable for all types of shipping
containers, petrochemicals, steel, aggregates,
cement and biomass to name just a few.”
Ian Shaw - We decided that a speculative build of new box wagons was
appropriate
Shaw sees a bright future for rail freight in the
UK. Following the government decision in April
2015 to double the carbon floor price, effectively
making coal uneconomical as a power station
fuel, there was a sudden decline in coal volumes.
However, Shaw says the overall amount of
freight moved on the UK rail network has
remained fairly steady, with some sectors like
construction and intermodal having actually seen
an upturn.
“Our introduction of new tank wagons carrying
aviation fuel, box and hopper wagons for
aggregates, and more Ecofrets for the maritime
intermodal sector bear witness to this,” he says.
“We are definitely seeing a high level of
enquiries for box wagons at the moment,” he
continues. “As I said before, the construction
sector has been seeing signs of growth over the
past few years and, while the industry clearly
needs to see Government providing increased
levels of confidence to enable critical decisions to
be made, we strongly believe this will continue.
VTG’s latest generation of box wagons are
designed to incorporate enhanced levels of
strength and wear resistance as well as being of
the optimum length and volume for aggregates.
“This means higher levels of fleet availability and
more tonnes of payload in any given length of
train,” says Shaw. Additionally, the ‘track friendly’
bogies they run on, offer customers reduced track
access charges as well as significantly longer
maintenance intervals.”
VTG is even investing in significant fleet
additions. Some 200 new build wagons will be
delivered over the next nine months. These will be
open boxes, primarily aimed at the aggregates
market, but also suitable for a variety of other
VTG has wagons that service most sectors and commodities that use rail
commodities, Shaw explains.
“We decided that a speculative build of new box
wagons was appropriate in this case, both in
preparation for a potential increase in major
infrastructure projects and also to allow us to
manage our normal wagon fleet replacement
cycle,” he says.
Interestingly, aside from new rolling stock,
repurposing wagons is becoming increasingly
viable and VTG is taking full advantage of this
development. This was also prompted by the
growing redundancy of the coal wagon fleet.
“At VTG, we have always prided ourselves on
being innovative, both in the design of new
wagons and also in recycling existing ones to cope
with changes in the market place,” Shaw goes
on. “When the decline in coal movements for the
electricity supply industry became apparent, we
spearheaded the move to find a way to make
relatively new coal wagons suitable for the
efficient movement of aggregates – which are
much higher density - by shortening the wagons
and reducing the volume. This award winning
work has since become the benchmark for the
industry with hundreds of wagons having gone
through the same process,” he explains.
In 2017, VTG Rail won the ‘Freight and Logistics
Achievement of the Year’ award at the National
Rail Awards for this innovation. The award
recognises major new contributions to the
railfreight or logistics sector where the outcome
measurably enhances the role of rail in the supply
chain, and is part of the 20 year running National
Rail Awards that celebrate excellence in Britain’s
rail industry,
Most recently, VTG was one of the project
partners that won this year’s award. Working in
partnership with Railfreight Consulting, British
Airways, BP, Network Rail and Freightliner, the
award was made for a project that has seen
significant new private investment in terminals
and wagons provide a cost effective solution for
British Airways that will significantly increase the
resilience of fuel supply into the country’s largest
airport, London Heathrow. The project is designed
to operate for at least 15 years.
Of course, one spanner in the works is Brexit
which has the potential to disrupt significantly the
country’s logistics chains. However, Shaw remains
calm.
“Brexit has been a significant distraction for VTG
as well as for the whole rail freight sector, and as
part of Europe’s largest independent wagon
leasing company, it is not something we wanted
to happen,” he says.
“However, as always we are facing our
challenges head on, and planning for them in the
best way possible,” he says.
While the exact nature of Brexit is not yet known
(at least at the time of writing) VTG is taking steps
to ensure that stocks of critical imported
components are being increased to minimise the
impact of potential supply chain disruption.
“As the main supplier of internationally
approved ‘Megafret’ intermodal wagons, we are
also talking to our customers and other industry
stakeholders about increasing the availability of
this fleet, should there be a need to run additional
trains through the Channel Tunnel to alleviate
cross border delays,” Shaw says.
Silk Road links require regulation in Europe
S
takeholders on the Silk Road urgently
need to co-ordinate their actions more
closely due to rapidly growing flows of goods
and trade along this major geo-strategic
route, which spans more than 12,000
kilometres.
To this end, closer co-operation with the Group
of European TransEurasia Operators and
Forwarders (GETO) was agreed on the sidelines of
the 28th plenary session of the Coordination
Council for Trans-Siberian Transportation (CCTT).
Last year alone, flows of goods between China
and Europe along the Silk Road railway corridor
increased by more than a third (35 percent),
according to Russian Railways (RZD). While China
has a standard set of rules for transport planning
through goods platforms, in the European Union
(EU) flows of goods encounter a “poorly co-
ordinated logistics and infrastructure system”.
CCTT and GETO will work together with industry
and authorities in the future to develop and put
forward proposals for co-ordinating both
innovative technologies and existing IT solutions.
“We have to develop a network of public
authorities, industry as well as existing
infrastructure – terminals and rail networks – to
solve the main problem of bottlenecks in the co-
ordination of the last mile to the consignee,” said
Harm Sievers, GETO’s president.
GETO and CCTT have a long history of working
together. And today they still enjoy a close
partnership that benefits both sides. CCTT’s
secretary general, Gennady Bessonow, feels that
GETO’s partnership initiative is urgently needed
and that there will be outstanding opportunities to
improve this co-operation in the future. “All
partners involved along the Silk Road are
indicating to us that they are willing to improve
existing processes and to connect through us.
There are no concerns at all about this partnership
– we are being urged to put forward proposals by
policy-makers, authorities and industry in all
countries involved,” he said.
GETO and CCTT will work together closely on
developing infrastructure related to customs
procedures, digitalisation and the harmonisation
of international law along European-Eurasian
routes. The main goal is to continue raising
awareness among governments in affected
countries and to continue increasing the
movement of goods at almost equal workloads in
either direction. “This will allow us to tap into
additional sectors and groups of commodities and
to create lasting jobs along the 12,000km corridor,
which goes through five countries, as a result of
these services,” Sievers said.