Aurizon multimodal train in Queensland. Photo credit: Luke Cossins

Aurizon sale may not be possible, beer prices increase

Aurizon may be prevented from selling its terminal at Acacia Ridge to Pacific National due to concerns over a lack of competition. The alternative is closing the intermodal business, which will turn beer cargo to the road. A sharp increase of beer prices will be the result, claims the hospitality sector.

The Australian Competition and Consumer Commission (ACCC) said it is concerned about the purchase of Pacific National as the two companies currently share a monopoly position on the intermodal rail freight market. Aurizon announced in August last year to sell its intermodal freight business in Queensland. It signed a binding agreement with Pacific National, subject to approval of the ACCC. The final decision of the watchdog will be taken on 19 July 2018.

Beer prices up

Aurizon warned that if it could not sell its business, it would close the terminal. However, according to the hospitality sector there is currently not enough capacity on the road to handle the volumes of beer transport currently taken up by train. Hoteliers and retailers fear beer prices could increase by as much as 2 Australian Dollars (1.27 Euros) a carton if the sale is stopped from going ahead, the Australian Townsville Bulletin reported.

Aurizon explained earlier that the exit was the right response to ongoing losses of its intermodal business. The sale will enable Aurizon to focus on its heavy rail haulage operations and rail infrastructure management. It has also offered its intermodal operations linking Brisbane and Cairns to a consortium of Linfox and Pacific National. The transactions together have a value of 220 million Australian Dollars (150 million Euros) and include the transfer of around 380 employees as well as assets, commercial and operational arrangements.

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Author: Majorie van Leijen

Majorie van Leijen is editor of RailFreight.com, online magazine for rail freight professionals.

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