CFR Marfă’s privatisation brought back into discussion the situation of state-owned terminals and the free access to their services and facilities. 27 in number, CFR Marfă’s terminals exist mainly on paper, most of them being deserted and requiring urgent modernisation. The representatives of private employers’ associations who attended the first session of the public debate regarding CFR Marfă’s privatisation demanded to know more about the fate of the 27 terminals and also about the impact that the privatisation will have on the logistics market. There are, however, other companies that chose not to wait around for miracles and began to develop their own projects which involve the use of some of the intermodal terminals. A similar project, which turned out to be a success and a positive example for other logistics operators who activate on the Romania market, came from British group Delamode, who launched a railway service that uses a private terminal, built in the ’70s. How did Delamode Logistics Romania manage to become the first and currently the only private rail container terminal operator and attract the most exigent customers on the logistics market, retailers? Railway Pro managed to get an exclusive interview in the attempt to find out what is the company’s recipe for success, in which the ingredients come from both the private and state sector, seeing as CFR Marfă is one of the railway operators involved in this project.
Just like other international investors who entered the Romanian market, Delamode hoped that the changes brought by the fall of communism will come from the state and the new governments which succeeded in running the country. These changes promised a new revolution, a peaceful one, through which the Romanian infrastructure, and especially the transport infrastructure, would reach European standards. Romania’s accession to the European Union and the opportunity of benefiting from European funding through which the country could modernise or build new terminals strengthened the belief that the collaboration between the Romanian state and private investors would lead to success. The same ideas were shared by British group Delamode when it entered the Romanian market in 1992. Delamode Logistics has been activating on the European market since 1990. Trade growth between Western and Eastern Europe generated the development of traffic between ex-communist countries, which led to a development in the activities undertaken by Delamode in Romania. Knowing the potential of container transport and the strategic role that Romania could play as a gateway between Europe and Asia, Delamode decided to develop an intermodal service for container transport through Romania. Delamode Logistics Romania CEO David Goldsborough talks more about these initiatives:
David Goldsborough: “In 2005, we were looking for a way to develop a long-term business in the field of container transport. The strategic location of the port of Constanța brought encouraging perspectives regarding the launch of a container service from Romania to Hungary and then further on to Western Europe, Benelux and the UK. There is an increasing demand for this service, which involves shipments from the port of Constanța to Rotterdam or Brussels. The project, however, was not feasible using only road transport; so, we had to consider railway and maritime transport along the Danube, to Giurgiu.”
What Goldsborough found on site almost made him give up this idea. The maritime and rail transport infrastructure resembled the European infrastructure of the ’50s or ’60s, when Western Europe was still reco-vering from the war. He had trouble believing that a country with such an incredible potential and which has access to the Black Sea and to the most important maritime transport corridor in Europe, the Danube, is not investing in the modernisation of its transport facilities. Goldsborough remembers how everybody was telling him that it is practically impossible to develop this type of service, but he chose not to give up. He was filled with the kind of ambition that the artists who try to make it in New York have: if you can make it there, you’d make it anywhere. Intermodal Romania became The New York of logistics, at least in the decade following the year 2000.
The terminal used by Delamode was built in the ’70s
David Goldsborough: “Railway transport was facing the same situation”, he remembers. This made him choose railway transport, considering the better organisation of railway companies. “As for the barge transport, we found companies that had the necessary equipment, but lacked a cohe-rent business plan which could allow them to sign long-term partnerships.” “The railway provides a feasible alternative to road transport, especially in terms of cost, and the travel time is reasonably good in case of container transport, compared to maritime transport. The better organisation of railway operators made us choose the railway in favour of barge transport”.
“We set to find an alternative to road transport and we did”, said David Goldsborough with a purely British conviction. According to him, the strength of a company resides in its ability to overcome obstacles and to set high goals without expecting any outside help. This determination allowed Delamode Logistics to develop a service which is mostly done by rail. The solution regarding the railway container terminal came unexpectedly from the same old infrastructure which awaits modernisation and which should be upgraded to current European standards. Comat Electro terminal was built during the communist period, more precisely in 1973, as a supplier for the electric installation industry and construction materials. Located on the east side of Bucharest, at Faur-Republica, over a 10 acre surface, the terminal has indoor depots over a surface of 2.200 sq m, concrete storage platforms over a surface of 22.000 sq m, 1 rolling bridge and, the most important thing, standard gauge industrial rail lines connected to the national transport system. Its facilities, although compatible with the container shunting services, do not excel at technical level. However, Delamode did not wait around until the situation of state-owned terminals was clarified and chose Comat Electro as the setting for its activities.The railway operator services are ensured by CFR Marfă. However, this choice was not influenced by the fact that the access to CFR Marfă’s terminals would be more advantageous.
Railway Pro dug a little deeper to see how the collaboration with CFR Marfă is going along, seeing as more and more logistics operators complain about the fact that the state-owned operator doesn’t grant free access to its terminals.
The mentality of state-owned companies is dominated by a perspective which doesn’t exceed a 4-year span
Railway Pro: What can you tell us about your collaboration with the Romanian railway system and especially with CFR Marfă?
David Goldsborough: I can’t say that we had a special relation with the Romanian railway system or with CFR Marfă. Instead, I could talk about the mentality of state-owned companies, a mentality which we had to face when we were trying to carry container on inland waterways and which we face even now when it’s been decided that every container entering the port of Constanța has to be scanned individually by the customs authorities, an operation which we believe should take place in several customs points, including at destination. People from the state system have a short-term thinking span. We have rarely come across a perspective that exceeds a 4-5 year span. If you think about it, it’s more or less equal to the mandate of a politician, considering the fact that private companies develop investment plans over a period of 10-20 years and they want to have a constructive dialogue with their partners. That is why it would be best that, in 5 years’ time, they should have the same partner. Otherwise, many problems could appear in terms of communication. There is the idea that many other foreign investors share, according to which every 3-4 years, in Romania you have to take it from the beginning and explain to your state partners why you developed this business and what are the benefits that it provides. The state system is also influenced by the political factor and at one point you find that the thing you clarified with one executive is of no value when the person in question is replaced.
We have a good relation with CFR Marfă as far as communication is concerned. Our problems are more related to the poor state of the infrastructure, not the quality of the services provided by the operator. In the current context, I believe that CFR Marfă is doing a great job. We have also collaborated with private operators. We chose CFR Marfă based on several objective factors: the state-owned operator has the routes and the best equipment necessary for our activity.
To be continued…
by Alin Lupulescu
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