AS Europe’s rail freight market continues to go through the growing pains of liberalisation, it’s perhaps easy to lose sight of the fact that rail’s share of the overall freight market is stagnant or declining in many European countries despite growth in the overall market.

According to a report by the European Court of Auditors in 2016, rail freight volumes in the European Union remained stable between 2000 and 2012 at around 400 billion tonne-km, but road freight performance increased from 1522 to 1693 billion tonne-km. As a consequence, rail’s market share fell from 19.7% to 17.8% in 2013, while the proportion of freight moved by road increased from 73.7% to 75.4%.

While some rail freight operators might be content to target existing rail-borne traffic by offering lower prices or better service quality, others recognise that the industry needs to win back custom from road hauliers if it is to grow market share.

Geert Pauwels LineasIn April 2017, rail freight operator B Logistics cast off its historical brand, a legacy of its days as a loss-making arm of Belgian National Railways (SNCB), and relaunched itself as Lineas with the core aims of promoting modal shift to rail and reducing CO2 emissions from freight transport, while becoming a profitable international logistics business.

“The lorry is our benchmark - we want a rail product so good that people will choose us over road transport,” says Lineas CEO Mr Geert Pauwels. “Our clients say that if we can match the transit time and service quality of lorries, they will move more of their freight by rail. But at the same time we don’t want to provide something that’s the same as road haulage, we want an offering that takes advantage of the strengths of rail. If you can move 2000 tonnes in one go over large distances, back-and-forth every day, you can beat road transport for cost and reliability. We also want to ensure that clients have the flexibility to use our product whenever they need it, not just when it is available.”

Through its growing Green Xpress network, which was launched by B Logistics in 2015, Lineas aims to provide a rail freight product that will appeal directly to road freight customers. Green Xpress mixes intermodal and single wagonload operations, extending the benefits of fast, reliable connections expected by intermodal customers to the wagonload market. “This approach has a lot of advantages - we can run longer, heavier trains, increase frequencies, and make the product more robust,” Pauwels explains. “It takes the high quality necessary for intermodal and gives it to wagonload customers, who didn’t have such a great offering in the past.”

Wagonload is a sector where rail freight comes into direct and intense competition with road, and here the industry has ceded a huge proportion of its traffic to road over the last five decades. As volumes declined, the networks needed to sustain this type of operation shrank and in many regions became unsustainable, leading in some countries to the total abandonment of the wagonload business.

The Green Xpress network expanded in 2017 with the launch of new services from Belgium to Sweden and Austria. In December, three short-sea and deep-sea terminals in Zeebrugge were added to the system, giving the Belgian port a daily service with connections to industrial hubs in Switzerland, Germany, Italy, Spain, the Czech Republic, Sweden, Slovakia, France, Austria, and the Netherlands.

“We will add more Green Xpress services throughout 2018, and we’ll keep expanding the network,” Pauwels says. “This isn’t just customers coming to us with a question, we are actively targeting road flows. This is our mission, and there are few operators really doing this.”

The Green Xpress concept is built around an offering that reflects the quality of road-based logistics solutions. This includes features that are not yet universal in rail freight: regular services, track-and-trace, and a clear estimated time of arrival. Pauwels also sees first and last-mile solutions and warehousing as logical extensions of Green Xpress to create an end-to-end rail-based logistics product which meets the needs of a wide variety of industries.

While rail freight operators can adapt their offer to attract companies that are currently reliant on road haulage, Pauwels argues that modal shift to rail will at best be minimal without the support of policymakers and infrastructure managers (IMs).

“There are four elements we need for change,” Pauwels explains. “Firstly, rail freight operators should see the lorry as the benchmark, and we should all have the same goal of stimulating modal shift to rail. Secondly a big mental shift is needed among regulators and IMs to facilitate the work of train operators who want to achieve modal shift. It should be just as easy for a train to cross an international border as it is for a lorry. Thirdly, policymakers need to have a shared vision for rail. The European Commission seems convinced that more freight should go towards rail, but not all member states seem to support that aim.”

“The fourth lever is innovation. As an industry we’ve been around for 200 years and some things haven’t changed much in that time. If you look at other sectors, they have entirely reinvented themselves. We are seeing this now in the road haulage industry and it’s moving much faster than rail. It’s vital that we push innovation in the rail sector as a whole to develop solutions that are at least as good as what is emerging for road freight. The infrastructure is already there, we just need to dramatically improve its performance. What we need is hyper-rail, not Hyperloop. This requires cooperation between IMs, train operators, and suppliers.”


Lineas was not directly affected by the landslip at Rastatt in Germany last August, which led to a seven-week closure of the Rhine Valley Line between Karlsruhe and Basle and huge disruption for freight services on the Rotterdam - Genoa corridor. However, Pauwels argues that event is a wake-up call which should reshape the relationship between IMs and the rail freight sector.

“IMs should see themselves as actors in mobility, but they are not always great at providing end-to-end service for the operators,” Pauwels says. “Essentially, their mission should be to make running trains easier. But if you look at the response to Rastatt this simply wasn’t the case. There’s a general feeling among operators that many IM’s don’t see us as customers. Rastatt should clarify the relationship between IMs and operators, and what happens in a crisis - there should always be a plan B in such situations. The IM needs to be able to make better use of the network and manage freight flows proactively, especially when things go wrong.

“IM’s seem to see their role as providing safe infrastructure as cheaply as possible, not being a mobility provider. For the freight operators, it’s not necessarily investment in new infrastructure that really matters - it’s really about how well the infrastructure and the capacity that is there in the network is managed. Rastatt has exposed the weaknesses in the system and I hope it will drive a mental shift. But governments also need to make this clear to the IM’s, which are state-owned, and ensure they collaborate with other industry stakeholders.”

Despite these challenges, 2018 will be a year of further expansion for Lineas as it extends the Green Xpress network and pushes into new markets. “We’re recruiting a lot in 2018, we plan to expand our workforce by 15% and become much more international,” Pauwels says. “Internally we are preparing our organisation and IT to ensure we can continue growing in the coming years. We’re looking for organic growth but we will start looking at acquisitions to facilitate growth in certain areas.”

With the European Union forecasting GDP growth of 2.1% in 2018 and 1.9% in 2019, the economic conditions look set to favour rail freight, aiding the sector’s recovery after a long and painful downturn. However, rail freight continues to fight against many of the headwinds that have limited growth and suppressed rail’s ability to claw back market share. If the sector can sustain the debate that has erupted in the wake of Rastatt, perhaps it has an opportunity to finally convince policymakers of its value.