Operail stops rolling stock leasing as well as regular freight services
Operail, the Estonian national railway company, sold the third and last batch of its rolling stock. “With this, all wagons belonging to Operail Leasing have been sold and the rental business has ended”, the company specified. The company is also shifting from regular freight services to project-based ones due to significant decreases in volume.
The latest sale involved 1,036 wagons for a total price of 22,7 million euros. These wagons, according to Operail, were sold to six Estonian and one Kazakh company. Last December, Operail sold 522 wagons located in Ukraine for 6,51 million euros. In January, the company sold 807 more wagons for 22,1 million euros. The buyers for the sale in January were Kazakh ATSAU Group, which acquired 410 wagons, and Estonian Skinest Rail, which bought 397 wagons. In total, thus, 2,365 wagons were sold for 51,34 million euros.
Operail sold its most profitable business
“Wagon rental was Operail’s most profitable line of business for the last six years, accounting for 99% of the profit”, Operail pointed out. Between 2017 and 2022, the company’s wagons brought in 68 million euros of rental income. During this period, moreover, Operail Leasing had an annual return on equity of 21 per cent, 38 per cent more than the company’s expectations.
Operail’s wagons were leased to companies carrying out transportation on broad gauge tracks. The initial idea, written in 2016 and put into practice in 2021, entailed the partial privatisation of Operail Leasing. However, as the mother company stated, the Russian invasion of Ukraine made them decide to sell all of Operail Leasing’s assets.
No more regular freight services for Operail
Operail has also mentioned that it will start contracts for the provision of freight transport services based on price offers with its customers. The Estonian company said it can “guarantee a constant readiness to transport small quantities between all stations open for freight transport in Estonia”.
This initiative is connected to the fact that, due to the sanctions on Russia, “the volume of goods transported on the Estonian railway infrastructure decreased by nearly 40%”. The company added that starting in 2023, there is a ban on Russian and Belarusian goods that are not sanctioned, causing an even steeper decline in volumes.
With this new model, the price and terms of services would be agreed upon with each customer. As Operail underlined, prices will fluctuate according to the volumes that are desired to be transported, the route, and transit time. The company stated that the new payment calculation guide is being revised and the new one will be published online as soon as possible.
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