Switzerland off to another rail freight market reform
“The last few years have shown that rail freight in Switzerland can hardly be financed independently”, claimed the Swiss Federal Council. As a result, “there is a need for further reforms with a particular focus on single wagon traffic”. The Council commissioned the Federal Department of Environment, Transport, Energy and Communications (DETEC) to draft some concrete proposals to tackle this issue.
DETEC will complete its study by Autumn 2022. The two pillars to address are the financial viability of single wagon traffic and the support of rail freight’s self-economy through incentivising more companies to use it.
Single wagon traffic positioning complex
“Rail Freight traffic in Switzerland should be self-financing according to the law”, explained the Swiss Federal Council. “The central question is whether and how the current non-cost-covering Wagonload traffic should be positioned to continue contributing to the security of supply and the achievement of climate targets”, it added. Apart from the central question, this is also the main challenge that DETEC will have to face when developing ideas to make rail freight more independent financially.
The Federal Council highlighted that single wagon traffic constitutes a pretty complex matter since it is not easy to maintain economic independence when bundling single wagonloads. Consequently, DETEC’s primary task will be to seek ways and “help single wagonload traffic modernise in coordination with the industry and become more attractive to customers in a targeted manner”. This will probably require “comprehensive financial support for single wagonload traffic from the federal government”, at least in the initial stage.
Moreover, the Federal Council asked for the Swiss rail freight market to continue developing in the direction of free competition. As a result, rail transport should be incentivised further for a self-economic rail freight sector. DETEC will have to look at how to attract more traffic to the rail and help shippers, for instance, move from single wagonloads to block train transport. One way to do it is by subsidising services.