Document

ESC welcomes the Commission initiative to further stimulate the development of intermodal transport. The freight integrator action plan contains a good analysis of the obstacles to its development. The Commission has outlined how some of these obstacles can be removed by regulatory action or best practice initiatives.

Modal shift

Over the last few years there has been a series of initiatives from the European Commission to promote modal shift. Shippers welcome the development of intermodal transport, it is particularly important to peripheral countries making use of short-sea shipping. The Freight Integrator Action Plan reiterates actions as outlined in the Commission’s White Paper on the EU’s transport policy. The action plan argues that space and environmental concerns limit the possibilities of increasing capacity on the road network. Increased structural costs in the road sector, as a result of new training requirements, reductions in permitted working hours and infrastructure charges, will make road transport a more costly solution in the future. The Commission justifies its modal shift policy by saying that relying solely on road transport may have negative consequences for European industry, which already faces higher logistics costs than international competitors. ESC welcomes the Commission’s recognition of the impact of increased logistics costs on the competitiveness of European industry. However, in this context, ESC would like to draw attention to the fact that the proposal to revise the Eurovignet directive carries the danger of a substantial cost increase for road transport and logistics costs in general.

Performance

Most supply chain managers in Europe manage a supply chain that is dependent on road transport. That dependency has probably existed for some years and the manager concerned is confident that he knows how the mode performs in service and cost terms. The EU Transport White Paper and the policy of many Member States seek to encourage these managers to move away from road mode to more sustainable modes. From a commercial point of view, a manager who is judged on the absolute performance of his supply chain will be extremely reluctant to move to an unfamiliar mode and put that performance at risk. Shippers/Supply Chain Managers are responsible in industry for ensuring that materials and products are safely delivered to the right place in the right condition at the right time. Cost is an important consideration but has to be secondary to service. These managers are judged by the way in which their supply chains perform.

To convince shippers to rely on alternative modes we therefore need, first, to ensure that service quality is improved in those alternatives, especially railway transport, and secondly, that shippers are informed about those possibilities. Many of the Commission policies are geared towards improving the functioning of individual transport modes, by increasing competition and network interoperability (opening access to port services, rail liberalisation, rail interoperability, etc.) and are fully supported by ESC. Rail liberalisation will take quite some time to result in significantly better service performance, and until then it will often remain the weak link in a transport chain. Enforcing adequate implementation of the first and second railway package should therefore receive high priority. All transport modes should improve their efficiency and be optimised. This is equally true for road transport. ESC favours the introduction of long haulage vehicles in the EU, which would generate significant economic and environmental gains. Additional initiatives, as described in the freight integrator action plan, to stimulate linking the modes together are also warmly welcomed by ESC.

Freight integrator

ESC considers that the Commission puts perhaps too much emphasis on transport managers’ lack of training and of awareness of possibilities of intermodal transport as the cause of the latter’s slow development. Freight forwarders already perform door-to-door services and the fact that some of them - not all - would lack geographical coverage or would be rather road-focused, does not necessarily mean that they are not aware of the possibilities. Nevertheless, ESC would consider it helpful to raise awareness and intensify dialogue between shippers, transport operators and freight forwarders to fill in the gaps where they exist. At the same time, one should also not loose sight of the fact that organisers of transport do have to give their clients value for money, which means an efficient, reliable transport service at the lowest possible cost. To make a success of modal shift the alternatives to road transport must be attractive from a service performance point of view, which usually comes before a company’s considerations on the relative sustainability of the transport modes. If an individual mode, no matter how sustainable, does not fit into that picture, freight forwarders, or integrators, will not be able to make use of it, because they would put themselves out of business by offering substandard quality services or too expensive services.

Voluntary modal shift targets/promotional agencies

Concerning shippers’ voluntary targets and commitments to use intermodal transport, shippers do not favour any transport mode, they simply need to ship their goods in a suitable, reliable and cost-effective way. If intermodal transport services can fulfil those requirements, then environmental considerations may start to play a role in decisions on modes of transport, but not before shippers’ core needs have been secured. Awareness raising amongst shippers about the possibilities of intermodal transport is good, and ESC recognises its own responsibility here, but voluntary modal shift targets presupposes a competitive and satisfactory service performance, which unfortunately cannot be assumed in all cases. A network of promotional agencies for intermodal transport would be welcomed by ESC, as would be efforts to disseminate best modal shift practice. ESC has in-depth experience with the development of service performance indicators (SPI’s) in air transport and short-sea shipping, jointly agreed upon and implemented by shippers and transport providers. Agreement on service performance, by developing and promoting SPI’s, can contribute significantly to boost intermodal transport.

Competition rules

Concerning cooperation between shippers, even competitors, on logistic issues, the Commission is right to state that transport is not their core business. However, a distinction between high and low value goods is important here. Where transport costs constitute a large part of total costs shippers may be les prepared to cooperate with competitors. Nevertheless, in general it would be helpful to have a clarification of the competition rules in this respect.

Standardisation

ESC welcomes the initiative of a Community wide voluntary certification scheme to standardise quality. As described above, ESC has in-depth experience with the development of service performance indictors. In ESC’s view, SPI’s would constitute the right basis for a certification scheme. ESC appreciates the Commission’s work on the harmonisation of intermodal loading units, the diversity of the units in circulation clearly hampers interoperability and generates costs, which does not favour intermodal transport. ESC agrees to the provision that units in circulation will not have to be adapted to the new requirements and that acceptance of the standardised unit will be left for the market to decide. Concerning standardisation of equipment and documentation, ESC agrees to its importance, but is wary that this should be done in an international context as much as possible.

Simplifying responsibility and accountability

ESC very much welcomes initiatives in this area, simple procedures and clear accountability will help raising the attractiveness of intermodal transport.

For further information contact: Nicolette van der Jagt, Secretary General of the ESC - Brussels 00 322 230 2113