Alex Veitch, Head of Multimodal Policy at FTA, explores the results of the Freight Transport Association’s Logistics Report…
FTA’s Logistics Report, launched in May 2019, polled the opinions of more than 500 freight and logistics businesses operating in the UK and internationally. For rail, our respondents reported strong performance in domestic bulk and semi-bulk but see more challenging times ahead as the ongoing uncertainty surrounding Brexit takes its toll. Unsurprisingly, sentiment for 2019 is much more subdued, reflecting these concerns; new business projects fell to an eight-month low and manufacturing growth reached a three-month trough in January 2019.
FTA’s survey indicated that the uncertainties surrounding Brexit are impacting every sector within the logistics industry; 61 per cent of respondents say this uncertainty is a barrier to the growth of their businesses internationally.
With indications of a reduction in global demand this year, the survey respondents anticipate a substantial decrease in domestic intermodal activity during the next twelve months. On the international level, respondents noted that bulk and semi-bulk rail freight declined in 2018, with no change to that trend predicted this year.
The report also found that the UK’s global competitiveness has dropped significantly and investment in the UK’s transport and logistics infrastructure is urgently required to boost its attractiveness to international investors. With regard to rail, network reliability must improve; the survey found that, in 2018, reliability had continued to worsen, although at a slower rate than in 2017. However, respondents did indicate that the overall reliability of rail is higher than that of roads.
For the foreseeable future, FTA is convinced that rail freight is set to play a more important role in the movement of goods in the UK and internationally, due to its low environmental impact, the growth of containerised imports, and ongoing network improvements.
In 2017, approximately nine per cent of domestic freight was moved by rail and the mode now transports more than one in four of the containers that passes through UK seaports. But operators not only compete with each other but also with road hauliers; ‘intermodal’, containerised freight is particularly price sensitive to competition from road. That is why it is so important rail freight services are improved to offer a more viable road transport alternative.
Bringing rail freight into the digital era
With such testing times ahead for rail freight, it is promising to see so many companies discovering and implementing innovative solutions to improve the rail experience. These technologies, including automation, the Internet of Things and Big Data, are helping to bring rail into the modern era; promising to increase operational efficiency, unlock new railway capacity, boost safety, and reduce logistics costs across the network.
The automation of locomotives is a natural progression for the rail sector; across all transport modes, projects are underway to automate vehicles to varying extents. Tests of prototype automated freight trains are already underway in several countries; Alstom is currenting trial-running a train which can travel one hundred kilometres (62 miles) without driver intervention. Further progress has been made in Western Australia, with mining company Rio Tinto already delivering its iron ore product via an autonomous, driverless train. While many companies are already reaping the benefits of automation, it is important to note that some countries forbid the use of autonomous trains. In the US, for instance, regulation is very clear that only a human is legally permitted to move a locomotive.
Across the globe, many rail companies are looking to the Internet of Things and Big Data to improve safety, efficiency and the customer experience. For example, TRAXENS has developed a Digital Freight Train, which can send numerous pieces of vital data to railway freight stakeholders in real-time. Retrieved via connected devices and sensors placed on the wagons, all types of information – from regular updates on consignment conditions to accurate mileage monitoring – can be accessed via the technology, all from the click of a mouse or a tap on a telephone screen.
To fast-track the digital modernisation of the UK’s railway, the Digital Railway programme has developed several initiatives designed to improve both freight and passenger train performance. From safer separation of trains delivered by the ETCS (European Train Control System) to better track worker safety through Traffic Management Protection and Signaller Controlled Warning Systems (SCWS), the programme is already helping to increase capacity on the UK’s railways while also boosting safety standards.
While historically the rail sector has not been associated with cutting-edge logistics technology, bold steps are now being made to modernise rail; the benefits of increased efficiency, safety and customer service will be enjoyed by all.
FTA’s members shift more than 90 per cent of all UK rail freight and are at the forefront of the industry’s step into the 21st Century and beyond. Factors such as a low environmental impact, growth in intermodal movements and network improvements mean that rail freight is set to play a bigger role in the future movement of goods in the UK and internationally. It is against this backdrop that FTA lobbies for regulatory reform and works to support members tackle key challenges presented by radically changing demand patterns, network capacity, network access, and the constant pressure to drive down costs.
Efficient logistics is vital to keep Britain trading, directly having an impact on more than seven million people employed in the making, selling and moving of goods. With Brexit, new technology and other disruptive forces driving change in the way goods move across borders and through the supply chain, logistics has never been more important to UK plc. A champion and challenger, FTA speaks to Government with one voice on behalf of the whole sector, with members from the road, rail, sea and air industries, as well as the buyers of freight services such as retailers and manufacturers.
Alex Veitch is Head of Multimodal Policy at the Freight Transport Association, for more information please visit www.fta.co.uk