Global Logistics and Supply Chain Strategies - May 2008 - (Page 56)

A Dual Intermodal Gateway Throughout Europe and Beyond Gerhard Oswald of Transfracht (TFG) Two joint ventures have created an intermodal link through German ports to destinations in Eastern and Western Europe and all the way to Central Asia. Germany’s two main ports, Bremerhaven and Hamburg, have long been the intermodal gateway to Central Europe, and their importance has increased as Eastern Europe has opened up to the West. Two rail services dominate these intermodal movements. Transfracht (TFG) provides port-to-point intermodal service throughout Germany, Austria, Switzerland, and eastern France. Service to Hungary is coming soon. POLZUG Intermodal connects the German ports with all of Eastern Europe, the CIS countries and beyond. To learn how intermodal service in Germany and Eastern Europe is developing, we spoke with the top executives of both of these services: Gerhard Oswald, the managing director of TFG, based in Frankfurt, and Walter Schulze-Freyberg, CEO of POLZUG, based in Hamburg. the intermodal subsidiary of Deutsche Bahn (DB), the German national railroad? Oswald: No. Transfracht (TFG) is owned by the DB’s logistics division, DB Mobility Logistics, and HHLA Intermodal, which is a major investor in the Port of Hamburg, so we are an independent company. But we have been around a long time. TFG will mark its 40th anniversary in 2009. TFG carried the initial containers on Germany’s first intermodal rail service, and it has been one of the innovators in European international trade. but there are many others. We compete with them all, as well as with barge and highway competitors. Walter Schulze-Freyberg of POLZUG Q: Is Transfracht Q: So TFG is essentially a private intermodal rail operation? Oswald: No. TFG owns no rail equipment or transportation assets, nor does it run the drayage operations. What TFG provides is the logistics know-how to assure quality combined transport, or what you call intermodal service in the U.S. For the last 40 years, we have focused entirely on service between Germany’s two major ports and the hinterland. We take the financial risk of running the trains, which is considerable. We contract for space on DB trains. Our annual fixed costs for these contracts last year was 150m euros [Ed. Note: about $239m]. We are the customer’s one point of contact for the service, and this requires a large investment in IT capabilities and customer service. Q: How about POLZUG? Is it built on the same model as TFG? Schulze-Freyberg: Like TFG, POLZUG Intermodal is a joint venture. It was founded in December of 1991 as a joint venture of the Polish national freight railroad ( PKP Cargo), DB Mobility Logistics and HHLA Intermodal, so there are many similarities. There is one very big difference. POLZUG is an operating company as well as an intermodal service provider. When the Soviet Union collapsed and Eastern Europe was opened to the West, there was an immediate need for high quality intermodal service, but the national railroads did not have the capital or the expertise to provide this service. POLZUG was created to run the service as well as to market the service. POLZUG has its own equipment, terminals and other operations. Q: How exactly how does TFG fit into Europe’s intermodal network? Oswald: First you have to understand that European rail operations and structure are quite different from what you have in the U.S., where there are basically four or five major companies that own all the road beds and the equipment and operate their own systems and provide most of the services, including intermodal. Railroads in Europe are, for now, owned by the various national governments, but other parties can obtain trackage rights to run their own trains. We contract with the DB to run our trains. In fact, TFG is one of the largest operators of block trains in Europe, Q: What is the scope of intermodal service that TFG offers? Oswald: In 2007, TFG moved nearly 600,000 containers or 932,000 TEUs on our AlbatrosExpress 56 MAY 2008

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Global Logistics and Supply Chain Strategies - May 2008

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