Why Rail Freight Services Are Making a ComebackPosted in Banking and Finance
The history of transportation methods has dictated that logistics has progressed from trains to trucks over time – although there is a suggestion that the former might be making a comeback. Admittedly, it has never completely died out and many companies have used this approach to transport their goods between destinations. However, over the last few years its popularity is increasing again, to an extent where some industry experts believe that it could become a serious competitor to traditional road haulage in the near future.
There are plenty of reasons why this occurring and we’ll now look to decipher several of the main ones through the remainder of this post.
This is probably the biggest reason why rail freight is making a resurgence. Fuel price increases are something that universally affects all methods of transport, although trains are able to offset them much easier than trucks as they are able to use fuel much more efficiently.
To highlight how this occurs, we’ll refer to a simple example that was reported on in Australia. Here, it was claimed that the typical truck will travel from Melbourne to Sydney in approximately nine hours. During this time, it will consume around 500l of diesel if it was to carry a 45-tonne load. If we then compare this to a diesel train, the results are staggering. The train could carry a 675-tonne load, which equates to fifteen times more than the first example, and consume just 3,250l of diesel. Therefore, logistics companies will be able to get much more value for money by using the train.
Admittedly, you have then got to factor in other issues such as the load drop-off and delivery, but these are likely to be minor when you take into account just how much fuel costs nowadays.
If you keep track of the news, you will have probably read that haulage firms are regularly having to tighten their security to foil the attempts of criminal gangs looking to steal their cargo. Admittedly, the same could occur on the train, but the fact there are few stops involved on the typical journey means that the risk is greatly diminished. Subsequently, companies no longer have to invest in advanced security locks such as the ones available at www.loksys.com and can knock more money off their total spend.
Some companies won’t care about this, while others will base their decision entirely on staying ‘green’. As well as being much more efficient from a fuel consumption perspective, trains also release over 50% less CO2 for each journey. This could also prove to be significant in the future, if the government continue to push the tax credits given for those firms who stay environmentally friendly.
There has also been an increase in the number of companies that provide an intermodal method of transport. This means that there are more firms providing a complete service which will get your products from one location to another, using trains and trucks. Naturally, trains have benefited from this as while companies would once simply take the easy option and push all of their goods onto a lorry, nowadays they can leave this to a third party who can arrange the journey using specialist intermodal equipment.