British Rail Privatisation White Paper: Freight: Company links road and rail

BR'S FREIGHT business is currently a financial disaster area. The losses of the Railfreight Distribution business are over pounds 118m on a gross income of less than double that. This is partly offset by the success of the Trainload Freight part of the business, which transports bulk products such as coal and petroleum and which made a profit of pounds 67.5m.

The sharp losses of the distribution business seem inevitable given the flexibility of road transport, which is also able to take goods from door to door. The privatisation of BR's freight would, therefore, seem to make the closure or at least running down of this type of service inevitable.

Not so, according to Charterail, a company that is seeking to make use of the relative cheapness of rail over long distances by transporting freight on a combination of road and rail. Created two years ago as a joint venture between BR and the private sector, its managing director, Robin Gisby, says the company has begun to attract business from firms that previously ruled out rail transport such as Safeway, Argos, Tate and Lyle and RHM.

The key, according to Mr Gisby, is the ability to transfer the goods rapidly from road to rail and vice versa using suitable containers and trailers - 'bi-modal technology'. Mr Gisby accepts that the minimum distance to make such transfers feasible is about 200 miles (320km). The company runs six trains a night linking its five railheads in north London, Melton Mowbray, Warrington, Trafford Park in Manchester and Glasgow and hopes to open new railheads in Avonmouth, Wakefield and Aberdeen. It is already taking goods to Orleans in France and will soon also be operating to Paris.

Mr Gisby said savings could be made because 'trains only need one driver and one locomotive, and therefore we can offer competitive prices'.

Most companies using Charterail, based in Cricklewood, north London, are doing so only on a trial basis. Safeway is using it to take wine every day from its depot in Essex to Bathgate, between Glasgow and Edinburgh. Lawrence Christiensen, its logistics director, said: 'The trial is encouraging and if successful could come into its own.' He is examining the potential for bringing wine from France.

Rank Hovis, part of RHM, has also been using Charterail on a trial since last month to transport large bags of flour for milling. A spokesman said that the company 'was pleased with the service and at the low level of damage to the bags, which are quite fragile'.

Privatisation, according to Mr Gisby, will accelerate Charterail's growth and the company will start running its own locomotives. However, he was concerned that the details of the White Paper would ensure 'that costs of access to rail for freight operators stand comparison with those incurred by road hauliers for access to the road network'.