© Nikolai Sorokin
Written by Charlotte Goldstone 05/22/2024
The European Commission has approved a €1.7 billion German state aid plan. Supporting rail freight operators and facilitating The paradigm shift from roads to rail.
The scheme aims to help rail operators transporting individual and group vehicles to support their high operating costs. By facilitating the shift from road to rail, the scheme aims to promote “greener modes of transport”.
In single wagon load haulage, individual wagons or groups of wagons from different shipping companies are grouped together to form one train, whereas group wagon haulage maintains the same composition from source to destination.
“Both types of transport are struggling to achieve economic viability,” the European Commission said.
“Moving a single wagon load involves high costs due to its complex, multi-step nature resulting from the exchange and transfer of wagons, and moving wagon groups operated by short trains does not benefit from economies of scale due to the low number of wagons and the short distances they serve,” she explained.
That is why the European Commission yesterday announced its approval of Germany’s request for state aid, noting that it is good for the environment and will not have negative effects on competition and trade in the European Union because it “is limited to reducing the competitive disadvantages faced by rail freight transport compared to road transport.”
Financial support for railway operators will be in the form of direct grants of up to a maximum of €320 million per year. This will amount to €1.7 billion over the five-year plan period.
Meanwhile, intermodal rail traffic from U.S. West Coast ports has also gained momentum this year, according to rail operators BNSF and Union Pacific.
Trains.com The intermodal service, operated by BNSF and carrier JB Hunt, reportedly gained volume as cargo owners chose to send more sea containers all the way to inland points rather than transferring cargo to domestic containers.
The service was launched in November and was specifically aimed at loads that had never touched rail before.
“This is a real transformation of the highways,” Darren Field, president of J.P. Hunt Interstate Transportation, said at an investor conference. “It’s not intended to be a different level of service to the existing interstates.”
“We are attacking the highway opportunities that are out there and we are having good reception and good success and we really believe that in the long term we can grow the intermodal business with our Quantum product.”
The rise in reloads has made operators “optimistic” about the prospects for intermodal transportation in the United States, according to Trains.com, Who mentioned this? That’s why BNSF proposed the $1.5 billion Barstow International Gateway project.
The 4,500-acre complex will include an exchange yard, a support yard, warehouses and transshipment centers where goods in international containers can be transferred to domestic boxes for the journey east to domestic markets via rail.The licensing process is expected to open in late 2027.
If approved, this would alleviate congestion at the ports of Los Angeles and Long Beach and eliminate an 80-mile journey of freight that currently has to be trucked from the ports to be reloaded before being trucked to one of BNSF’s combined-transport terminals in Southern California.
