The volume of intermodal transport increased last year, though not sufficiently

Posted by Bíró Koppány Ajtony

Rail and water transport are the winners, road transport is the loser of the COVID-19 pandemic

Domestic intermodal goods traffic showed a further modest increase of 1.7 % last year, however, if Hungary wants to deliver its commitment of the climate related targets towards the European Union, yearly 50-100 thousand tonnes of truck freight should be redirected from the roads to intermodal transport modes, according to the latest analysis of the Association of Hungarian Logistics Service Centers (MLSZKSZ). The analysis points out that the pandemic significantly rearranged the map of goods transport last year: while the volume of water transport and the tonne-kilometre (TEU) output of all transport increased, road transport fell back according to all indicators. Road transport companies have to try to find new ways in order to maintain their competitiveness, where the development of intermodal transport could offer good solutions, e.g. the building of new combi terminals in Hungary, the implementation of the V0 railway ring and the development of the new intermodal transport incentive scheme.

The developments of the Hungarian goods traffic scene were influenced in 2020 mainly by the effects of the Covid-19 pandemic (production stoppages in factories, border closures, hectic, sometimes 15-fold increases in orders), at the same time the substantial driver shortages, the restrictions of the EU Mobility Pack and the turmoil around the Brexit – all these factors had a great influence on the performance of the sector. Nevertheless, Europe witnesses processes that will result in radical changes of the transport market, therefore MLSZKSZ highlights the importance of speeding up and raising the level of cooperation between road, rail and water transport actors.

The total volume of Hungarian goods transport (285 Mt) decreased by 8.5 %, its performance (52 billion tonne-kilometres) diminished by 11.3 % compared to 2019. The total domestic traffic volume dropped by 7.7% and the performance by 6 %, while the international turnover values show a 9.9% and 13.6 % decrease respectively.

Inland water transport – strong rise from the low basis of 2018

There was a decline in nearly all the transport modes. The volume of water transport increased by 2.5 %, and the railway tonne-kilometre performance exceeded the results of the previous year by 4.9 %. All these factors resulted in the tendency to redirect goods traffic from road transport to waterways, whereas the number of long distance rail transports increased.

After the substantial decline in 2018 (-18 %) and the big increase in 2019 (+24 %) the inland water transport could further grow in 2020, which is also due to the pandemic situation. The turnover of the three big ports, Baja, Csepel and Győr-Gyönyű, rose on average by 32 %, and the other ports produced a mere 5 % increase. The performance of the small ports was similar to their last year’s results. A total of 3,130 containers were transported on waterways, which is an 8 % increase compared to 2019. Mahart Container Centre produced this traffic.

Sea-container traffic affecting Hungary

In 2020, for the first time in Hungary, a 6-month-survey was conducted in Hungary about the container traffic organised by shipping companies. The main export/import transport routes for incoming goods to Hungary are the southern ports (Trieste, Rijeka). The container cargo traffic from the south is six times higher than the same incoming traffic from the north, whereas the total amount of export container traffic from the south was three times higher in the first half of the year, and 1.7 times higher in the second half of the year compared to the turnover of the last year. This shows that the strong Hungarian processing industries need the raw materials from abroad, mainly from the Far-East. The loaded container traffic of the shipping companies

amounted to 307 383 TEU (twenty-foot equivalent unit) in 2020. The majority of the finished products left Hungary by road transport, and a lesser quantity by rail. The movements of empty containers were significantly higher, 174.597 TEU, last year. These were removed to other European industrial centres, where they were loaded and then got back into the circle of sea transport. However, a smaller proportion were sent back empty to the Far-East.

Road transport – may have to face permanent market losses and substantial shifts in the future

The contraction of road transport, the biggest decline compared to the other modes of transport, continued in 2020 as well: its volume decreased by 7.2 % and its tonne-kilometre output fell back by 12.8 % compared to 2019. In international transport the relapse of volume amounted to 12.8% and the output decreased by 17.8 %. The main reason for this fallback on the international scale was mainly due to the pandemic-induced border closures and the lack of drivers, while within the country the production stoppages in factories  (car-industry shut-downs for 1-2 months) were responsible for the decline. A part of international road transport was shifted to rail and waterways (around 1.1 tonnes of goods to rail ands 0,4 Mt to water).  At the same time the domestic parcel delivery service providers witnessed a record 45 % rise last year.

Railway transport – changing results: international increase and domestic decrease

In 2020 the volume of goods transport on rail (50.5 Mt) fell back by 3.2 %, at the same time the tonne-kilometre output (11.1 billion tkm) grew by 4.9 %, compared to the results of last year. In inland traffic the tkm-output decreased by 10.5 %, whereas the transported volume fell back even more, by 19.4 %. Internationally, the volume grew by 3 % and the output by 7.9 % in comparison to 2019. The shift to rail transport was more significant for long distance transports, partly because of the high number of halted trucks (e.g. Waberer halting 1500 vehicles). Actually, rail transport is less vulnerable to border closures and traffic congestion, moreover, it is less prone to the hazards of a virus infection. According to the figures of MLSZKSZ, the solid share of domestic intermodal transport within the rail transport sector is over 20 %.

Intermodal goods transport – steady growth even during the pandemic

Intermodal transport in Hungary has been constantly growing in the recent years, last year the rise was 1.7 %. MLSZKSZ data show that 96 % of the total domestic intermodal traffic entered the country through 3 combi terminals in 2020. The combi terminals of Budapest produced an average 4%-rise last year.

Owing to the pandemic situation, the need for intermodal transport grew significantly, a further, even more dynamic proportional increase of this transport mode is to be expected in the future.

The European Union also favours this transport mode. This is all the more necessary, as 50-100 thousand truckloads of traffic should be shifted from road to rail if Hungary wants to deliver its commitment of the climate related targets towards the European Union. This transport mode also provides a solution for a huge problem of international road transport, the critical shortage of drivers, as intermodal transport needs minimal staff, even for forwarding large amounts of goods. Furthermore, it is not affected by the big problems of road transport, like traffic jams, or border crossing, it is easy to organise: goods loaded on rail can cover even 1,200 km within 24 hours (which takes 5-7 days on waterways). Costs can be reduced as well:

rail freight rates are becoming more and more competitive, on the other hand intermodal transport involves direct cost reductions for the operators of road fleets. Instead of 30 truck drivers they need one engine driver and less trailers, moreover there is a lower level of amortisation costs including tread wear, repair and less maintenance, and the exchange of the trailers becomes necessary much later.

Promising steps in intermodal transport

The situation is promising, as several important developments have been started and government decisions have been brought aiming at the spread of intermodal transport modes. The construction of the East-West Gate Intermodal Combi Terminal is well ahead, and the development of the combi terminal at Zalaegerszeg is soon going to be started by METRANS. The new combi terminals are planned in a way that the semitrailers, even the non-craneable ones can be loaded on rail.

It is an important step furthermore, that the government has again entered on the agenda the project of the V0 railway ring around Budapest (which MLSZKSZ had repeatedly urged), and made a decision about conducting a survey and elaborating a development concept about domestic rail transport traffic. The implementation of V0 will place railway transport in a supply-position and stimulates the extension of intermodal transport. MLSZKSZ considers the government’s resolution to give green light to the detailed elaboration of the concept and to the development of the outstanding infrastructural services of rail freight for a highly relevant and timely decision.

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