Intermodal opportunities for rail freight, says report

New forms of intermodal transport could represent a high-growth market segment that rail freight may be able to exploit.

That’s according to a new report commissioned as part of the Government’s Foresight Future of Mobility project.

The rail freight sector in Great Britain: how and why is it changing, by Dr A. Woodburn of the University of Westminster, states that changes in the demand for freight transport present both challenges and opportunities to the rail freight sector.

Woodburn points out that from the late 1990s, the volume and market share of rail freight moved broadly grew, but has since declined sharply with a market share of just under 9.5% and 17.25 billion tonne-kilometres moved in 2015-16.

The rapid decline in power station coal is one of the key factors, although changes to industry are also leading to smaller volumes and more dispersed traffic flows. Furthermore, the proportion of Britain’s Gross Domestic Product attributed to production fell from 25% in 1990 to 14% in 2013.

However, intermodal transport almost doubled in volume between 1998-99 and 2016-17, and has increased its share of the rail freight market from 20% to 39%. An estimated 85% of domestic intermodal activity is maritimerelated, with a very small share of the genuine domestic market.

A further opportunity identified is to use spare capacity on the passenger network to transport goods. This could have an impact on shipments into, out of and across urban areas, where the challenges of ‘last mile’ logistics are greatest.

The author points out that high fixed costs and long-life assets make it challenging for freight operators to change operating practices in the short term, with political uncertainty adding further risk. Non-users of rail freight perceive greater obstacles to using rail than users do, and non-bulk users are more price-sensitive than bulk users.

Woodburn argues that technology can help rail freight “play to its strengths”, with areas such as enhanced signalling, running longer trains (possibly with remote-controlled locomotives), better transhipment techniques for intermodal goods, better tracking and tracing of consignments, and decarbonisation through electrification and other emerging technologies.

In the longer term, government involvement in other transport modes, notably road freight, will influence rail’s role in meeting Britain’s freight transport needs. Woodburn says that it could form part of an end-to-end system by integrating rail for the long haul and electric road vehicles for the ‘last mile’ urban distribution system.