Railways in Romania – “Cinderella” of Transport

Dragoş Floroiu, Director, Organismul de Investigare Feroviar Român (OIFR)

For more than 2 years, the economic recession has represented a threat to the needs of the market, but it also could represent a real opportunity for those who can bring new answers to the demands launched by various consumer groups. The relationship between the different actors who are involved in transport is also affected. These actors must cooperate with each other to find best methods and practices to fulfill requirements and demands of the customers who also are confronting this recession.In last decade, the railways in Europe adopted a series of measures for liberalizing the transport activities especially in the railway freight market, in order to respond more efficiently to customers’ demands. EU legislation creates the opportunity for new private companies to offer improved packages for customers, more reliable and cost efficient.In the Romanian Railway, since 1998, when the implementation of new EU legislation started and the national state company was reorganized, the private sector was more and more active in the freight railway market, the number of licensed railway undertakings steadily increased (in 2010, there are 27 of them). Analyzing the volumes of transport in the freight market for the last decade we can see an imbalance situation between road and rail in favor of the former. Road transport, with the exception of the last two years (because of the economic crisis), registered a continuous and sustained increase. Rail transport, with all the measures for liberalizing the market, continued to register losses in volumes, customers and market share. Private companies, without strong financial support from the outset, could not compensate for the lack of “costumer orientation” of the state company (CFR Marfa SA) who permanently lost transport volumes.Returning to the numbers we can see the sad reality that the real competition was between the state and the private railway sector in favor of road transport which responds more actively to costumers’ needs.The biggest private competitors of CFR Marfa are:Grupul Feroviar Roman or GFR part of Grampet Group, SERVTRANS INVEST SA part of the IRS Group, ROMPETROL Logistics, Trans Feroviar Grup SA, UNIVERTRANS SA, Rail Cargo Austria – newcomer to the market but very active, Logistic Service Danubius SA.In the past 10 years, the intermodal sector was forgotten, railway terminals were closed one at a time. The level of investment and the  modernization programs for the infrastructure was less than that required and these issues affected directly the commercial speed, the door-to-door concept, reliability and level of safety, which are elements requested by customers as a must. The lack of vision and strategies in the railway field makes this mode of transport unattractive in 2010. It has become the “Cinderella” of transport. The adoption of a strategy at national level, reorganization of CFR Marfa on the bases of customer orientation and finally privatization of this company are essential.The benefits of private management at CFR Marfa, as a consequence of the privatization process, will only become evident in the long term, but until then CFR Marfa has to improve its activity: Company must take the right measures to improve the utilization of human resources, and the costs of production. Private companies use only 12 – 20 employees per train, CFR Marfa use more then 50 employees per train;Rolling stock fleet of CFR Marfa must enter a maintenance program toimprove the technical level, because they use only 25 – 30% of wagonsand 40% of locos, while the rest of the rolling stock fleet needs to be repaired. The rolling stock fleet has more than 28 years of usage on average;Company must implement a Single Customer Service, an Integrator of Transport and a Single IT Customer Platform which could offer an improved, faster and open service orientated to customer needs.


Share on:
Facebooktwitterlinkedinmail

 

RECOMMENDED EVENT: