CER: European Rail Freight Network needs investments

CER presents investment requirements of a Primary European Rail Freight Network

Brussels, Belgium – European rail freight operators ask for an integrated investment approach to create a Primary European Rail Freight Network. At their meeting 2007-09-11 in Brussels, the CEOs of 40 rail freight companies presented to the European Commission a comprehensive business case analysis on the major European rail freight corridors. The study, which was undertaken by CER with the support of UIC and McKinsey&Co. as an input to the forthcoming Commission Communication on a European Rail Freight Network, indicates detailed investment needs in order to accommodate an increase of rail in the modal share of land transport by about 5%. With total investments of €145 billion by 2020, capacity of the major European freight
corridors could be increased by 72% and modal share increased from 17% to 21-23%.

The investment is needed to alleviate bottlenecks, enable infrastructure to accommodate longer trains and provide an adequate network of freight terminals. By removing bottlenecks, additional capacity will be created and service quality will improve. By upgrading the infrastructure to accommodate longer trains (of 750m, 1000m in some places), unit costs will go down and productivity will increase.

CER Executive Director Johannes Ludewig underlined: “Significant growth in rail freight will not be achieved without an ambitious programme of corridor-focussed investment in the infrastructure. What is most important is a coordinated approach over the whole network. This is a truly European challenge. The Commission should take this up and coordinate the national activities.”

On the basis of the business cases, CER proposed that Commissioner Jacques Barrot now calls six ministerial conferences along each of the corridors, in order to gain commitment by the Member States at the highest level.

Today, already €30 billion have been earmarked in national and EU budgets for infrastructure measures on the relevant corridors – reducing the sum to be brought up for the next 14 years to €110 billion. The CER study lists the necessary measures for individual corridors and indicates the financing requirement for each of the countries concerned. For France for example, yearly investments of €0.8 billion would be needed, which equals 54% of the planned annual investment of France into railway infrastructure (€1.5 billion).

The adaptation of the tracks to accommodate longer trains seems to be most promising with a high return on investment (+11% capacity for only 3% of the needed total budget). This should however not rule out necessary investments in bottleneck alleviation and terminal capacity enhancements. These would add 61% capacity, while requiring 85% of the overall needed budget.