Automakers building and selling cars in Europe are reluctantly bowing to pressure to switch more of their logistics operations from road to rail.
Manufacturers such as the Volkswagen group, Ford of Europe and PSA/Peugeot-Citroen rely heavily on rail for transporting finished vehicles, according to the Auto-motive Logistics Report Europe 2004 done by consultancy Transport Intelligence of Swindon, England.
Others such as Mercedes-Benz and General Motors Europe are looking at ways to increase the movement of finished vehicles by rail.
“Almost universally vehicle manufacturers would prefer to use road as under most criteria it is cheaper, certainly more flexible and more reliable,” says the report. “However they feel under pressure to avoid using road.”
Governments – especially those in Alpine countries – want to reduce truck journeys to protect the environment and local communities from noise and air pollution.
“We are encouraging freight to move onto railway,” said Gregor Saladin from the Swiss Federal Office of Transport.
The Swiss government wants to reduce the number of trucks that annually cross the Swiss Alps 52.5 percent to 665,000 by 2009.
In Switzerland, 55 percent of traffic is transit – cargo that does not originate or end in the country. Two-thirds of the transport through the Swiss Alps is already on rail.
The Austrian government has a program that encourages companies to use rail instead of the road to transport goods. Two-thirds of the transport through the Austrian Alps still goes by truck.
German automakers rely heavily on rail for inbound and outbound logistics “in large part due to political pressure in Germany and Austria against road transport,” reports Transport Intelligence.
Mercedes launched a project last year with the German national railway network, Deutsche Bahn, to find more efficient ways to use rail to distribute finished vehicles in Germany and other European markets.
GM Europe set up a “hub and spoke” rail system last year to make better use of rail transport.
GM Europe’s rail network is based in the “hub” of Mainz-Bischofsheim, Germany, along “spoke” routes to German factories in Rüsselsheim, Bochum and Kaiserslautern as well as to GM factories in Spain, Belgium, Austria and Hungary.
Mike Dickinson, GM Europe’s logistics director, says that rising fuel costs and a new truck toll system introduced in Germany on January 1 are creating more cost pressures on truck transport.
But Dickinson says rail has a major drawback. “I don’t think rail is reliable enough yet.”
Automakers find rail useful for transporting large quantities over long distances.
But they say they can’t count on the parts arriving on time and they feel their needs are ignored by bureaucrats operating Europe’s mostly state-run railroads.
Manufacturers say they need the flexibility of truck transport for just-in-time and just-in-sequence component deliveries, which cut down on inventory costs and maximize supply chain efficiencies.
Road transport still dominates finished-vehicle logistics, said Richard Lawson, president of the European Car-Transport Group of Interest, a non-profit organization of 55 leading vehicle logistics providers.
“The rail infrastructure is not in place to handle the lead times required by carmakers for delivering finished vehicles to the market,” says Lawson. “A pan-European [rail] system is a long way off.”