What with the abandonment of wagonload freight in several countries, all-too-often unattractive transit times, poor service quality and lack of political support, European railfreight operators often face a struggle to survive.

And yet there is cause for optimism. Many shippers want to use rail, and some operators are seeing a return to growth. For example, Austria's Rail Cargo Group has managed to stop a perilous decline in its financial performance and is now becoming increasingly profitable, while the Xrail alliance of seven European wagonload freight operators has managed to stop the downward spiral in traffic. This is important because wagonload freight still accounts for 50% of European railfreight traffic, despite its virtual demise in several countries, notably France and Italy. But as it only has a 10% share of the overall freight market there is great potential for growth.

The so-called market place seminar in Vienna was organised by the International Union of Railways (UIC) and the International Federation of Freight Forwarders Associations (Fiata) with the objective of bringing operators and shippers together to thrash out their grievances, while at the same time putting forward their ideas to improve railfreight. While many shippers were brutally honest about the poor level of service they receive and the failings of politicians, the conference was not simply a railway-bashing exercise but a genuine attempt to seek improvements.

One delegate pointed out that the market share of private railfreight operators in Europe went from zero in 2001 to 25% in 2011, but at the same time rail's overall market share declined by 2% to 16.9%. Mr Paul Steijns, chairman of the Rail Transport Council, which acts as the eyes and ears of shippers in Brussels, said the situation is even worse as rail lost market share while the overall market was growing.

Prof Friedrich Macher, CEO of Grampetcargo Austria, believes the European Union's transport policy is a major challenge for all railways. "The main objective of increasing rail's modal share is not being promoted at the European level, for example, when mega trucks are authorised without any thought of their effect on rail traffic," he said.

This was echoed by Ms Nicolette van der Jagt, director general of Clecat, the European freight forwarders lobby group. "The European Commission believes there is a need for competition in rail to bring about a more efficient and customer-focused market, but despite three railway packages we still have unfair competition, weak regulation and a lack of interoperability," she told delegates. "The fourth railway package is designed to address these weaknesses, but I don't expect anything from it until 2020. The result is that these conditions scare off new entrants."

Not only is Europe increasingly unattractive to new open-access freight operators, but the big state-owned railways have been steadily acquiring private operators to extend their reach across the continent, while at the same time eliminating competitors. Should state-owned railways be allowed to buy private companies?

Some delegates raised the spectre of Europe eventually being dominated by three or four state-owned railfreight operators. This would probably lead to a further reduction in traffic, as the big operators with large overheads could only afford to go after the major flows. Any industry which prevents an influx of new blood is doomed to failure because it will stagnate and eventually die. New entrants are vital to bring in new ideas and keep costs down.

European railways should take a look across the Atlantic at the world's most successful railfreight market, which is entirely private and comprises a healthy mixture of a few large Class I railways, several smaller regional operators, and a great number of so-called short lines. The big railways are happy to encourage the small ones as they feed traffic into the network and enable small shippers to be served efficiently at affordable prices.

Nevertheless there are signs of hope in Europe. On the economic front, Mr Zoltan Potvorszki, managing director of Express-Interfracht Internationale Spedition, was one of several delegates to point out that the Turkish market is booming and represents a real opportunity for growth. "Intermodal freight in Europe has dropped, but the negative trend is levelling out and I believe there will be a recovery," Potvorszki said.

Macher says he is convinced that eastern and southeastern Europe will be "growth machines" for Europe despite the current unstable situation.

A number of delegates see potential for rail between Europe and Asia especially for high value goods where rail's transit time advantage over sea comes into its own. There is also a trend in China to move industrial production away from the overcrowded coastal area inland, which will benefit rail.

Railfreight potentially has a bright future in Europe as long as it focuses on the needs of customers, addresses its weakness such as border delays, and invests in good quality rolling stock and IT systems. As one delegate put it, competition should never be a war, we have to use our brains.