Open Access Spreads...

...across Europe and North America. Is the end of integrated railways at hand?

Union Pacific and Burlington Northern Santa Fé last week agreed to jointly control tracks in Texas in an effort to dissolve the traffic jam there. Implicit in this is the assumption that joint control is more efficient then separate, at least for the moment. BNSF already has extensive trackage rights (image, 55 kb) on the clogged UP network and last week's agreement widens the co-operation.

The Freight Freeways in Europe are part of a similar development. There, railways are co-operating with one another to provide a new framework to put international trains, many of which are as slow as those on UP's network, in the fast lane. Though none of these systems are really open access, ie having the track open to all comers, the trend is clear. Companies have had too many bad experiences with leaving their trains entirely in the hands of other companies, and are moving toward joint crontrol.

Interestingly, this development is mainly led by the railways themselves. Open access is not being foisted on them by any public body. Is this part of a trend that will continue?

The advantage of open access is that it penetrates the rigid structure that railways have. The capital investment a rail operator has to make falls, lowering the barriers to entering the market. Customers have more choice. The disadvantage is that investment decisions are harder to make in a volatile market, and railways require a lot of long-term capital to function.

Fragmenting rail services can also mean worse train usage, if one operator needs trains and another doesn't want to help its competitor. But that can be fixed with a train leasing company, like one of the three in Britain. Anyway, many cars are owned by the customers. Swedish SJ, widely accepted as being Europe's most efficient freight railway, only owns a fraction of Swedish rail cars. Most are owned by customers and forwarders. Appliance maker Electrolux sells its experience in logistics through subsidiary Nordwaggon, owner of thousands of rail cars.

There's only one thing stopping companies like Nordwaggon being called train operators, and that is something to pull the trains with. Maybe in the future we will see train drivers roaming with their locos searching for for work, just like truck drivers.