Unpalatable Truth: Shipping More Efficient Than Rail

On July 30, 2020, The Australian newspaper published an article lamenting the rundown of the rail freight network over there, due to intense competition from road and sea haulage. Whilst road transport of freight is not cost competitive in large quantities and long distances, it works well when only a small volume is to be carried over a shorter distance. Sea freight competition is something else; container ships carrying large volumes can undercut rail haulage in the same way rail can undercut road at the higher volume end of surface transport.

Sending freight by sea is slower than by rail, but this does not matter for a lot of freight, the delay sensitive stuff being perishable food and just in time supplies to retailers. But for coal and logs, for example, a few days extra delay does not really matter. And for goods being exported or imported, there is already a slow journey over the oceans and a bit of extra time moving it around the coast to the international port does not really matter. This is the key aspect of how Port of Timaru is able to offer international container shipping services without port calls. PrimePort acts as an inland port for Port of Tauranga; the containers are moved by Pacifica’s coastal service to and from Tauranga where they are loaded on and off international container ships, and Port of Tauranga is one of the biggest international container ports in NZ. With the coastal operation, PrimePort does not need to use the existing rail freight network to move containers via Tauranga, although rail is used to move freight between PrimePort and some of its South Island customers.

This fact of coastal shipping being viable for volumes of freight in competition with rail is also likely to be material in the decision, referred to in another article we posted a few weeks ago, to let the Wairoa to Gisborne rail line remain mothballed. The local rail action group is continuing its fruitless campaigning through the Gisborne Herald newspaper but without result, using nonsense claims to attempt to persuade politicians that the repair cost is much lower than what Kiwirail have suggested. An example is this paragraph from an article published only a few days ago:

“The line between Waikokopu and Gisborne was built in the 1930s by the Public Works Department at a time when they had extensive experience of railway line construction. Constructed through the rugged and challenging Wharerata hill country, it was well-designed and built to last (given basic maintenance). It is one of the youngest lines in the country and the steel rail does not show a lot of wear.” Well, actually, the Public Works Department did not do the geological testing that they do today, and that is the reason one of the tunnels collapsed after a few years of use, the reason why the line crosses over active landslides, the reason why many of the large culverts on the line blocked up after only a few years, the reason why the line is often closed for weeks at a time to clear slips…the reason why Kiwirail thinks it prudent to budget for a lot more work than basically reinstating the line as it is now.

Faced with the decision of whether to spend money on the rail line or on Gisborne Port, we believe the latter will get priority for an expanded shipping service, and some common sense that has been lacking in local politicians to date would see a coastal international container service via Tauranga, using the existing ships that already pass up the East Coast weekly on their run from PrimePort and other locations. Anyway that was well covered in our previous article. But because the Government has focused on coastal shipping and recently has been working on expanding its potential, not only will the Gisborne line likely remain mothballed, but the long held dream of a railway north from Gisborne through to the Bay of Plenty will never materialise despite ongoing campaiging by a handful of rail enthusiasts.

We have to acknowledge that coastal shipping in a number of areas of New Zealand is and will be a viable alternative to rail. This doesn’t mean we should look forward to a wholesale close down of rail in NZ. Moving freight to and from ports from inland locations is one area where rail freight remains viable, and another is freight that is more time sensitive. These are areas to focus on winning freight off road transport especially as this also reduces the maintenance burden for the highway network. Coastal shipping is also a relevant consideration where international containers are being moved on a foreign ship to a number of different ports around our shoreline. The key reason why the campaign to shut down and relocate the Port of Auckland to Northland is a nonsense is because the volume of containers that flow into and out of Auckland each week can be moved much more cheaply by ship direct to Auckland than by offloading at Northland and railing or roading to the big city. Some fantasists have even claimed that Northport should be our sole international port with everything moving around the country by rail.

We believe in summary there is no real threat to rail transport from shipping except in areas where rail enthusiasts think a new line should be built, or in the case of Gisborne, a poorly designed and maintained line should be reopened for a small volume of freight. Rail will continue to hold its own in surface transport against road competition and the construction of new rail ferries for Cook Strait will aid in doing this. However we have to face up to parts of the network being relatively unviable and the blame for that cannot be laid at the door of the shipping industry.

NZ Rail: Kiwirail Defends Failures Rates of DL Locomotives

There’s been a report today in Radio NZ News regarding the reliability of the DL Class locomotives, with the suggestion that many of the class members are not achieving the expected rate of reliability and that therefore Kiwirail should be choosing some other type of locomotive to purchase. Kiwirail has been aiming for a MDBF for the class of 80,000 km.

We do not have information here about the 80,000 km figure, whether it is world class or not, but will introduce some other numbers here. The gold standard for locomotive longevity set by EMD and GE has been a locomotive lifetime of 1 million miles (1.6 million km) over a 16 to 18 year period. During that time the locomotive would typically have a half life overhaul with the engine, main alternator and traction motors exchanged within the chassis with overhauled equivalents. We do not have knowledge of exactly how much work is needed on the individual components such as the engine at this half life overhaul period. Nor do we know very much about the historical classification system of A and B grade overhauls of locomotives, or how the EMD/GE data compared with the other historical types of diesel-electric or electric mainline locomotives in the NZR system, most of which were made by English Electric (one class made by Mitsubishi), or for that matter with the various types of shunting locomotives from a range of manufacturers.

However in general, we believe the EE / Mitsubishi locomotives were getting that exchange component overhaul at about half the mileage of EMD/GE locomotives and so were more expensive to maintain, and parts supply for EE locomotives was generally slower. The overall reliability of these classes also tended to fall well below EMD/GE locos. It was surprising therefore that after the experience of highly reliable locomotives built in North America that the Kiwirail management chose to purchase the DL class locomotives from CNR because there have been as many questions over their usability as there were for English and Japanese built locomotives in decades past. We understand that the half life overhaul for the DL class locomotives has been taking place at about 8-9 years for the members of the class with the Gen 1 locomotives having reached that milestone within the last couple of years. It has been difficult to get an objective picture of the usefulness of the locomotives because of the political heat generated over their introduction, from one side with the rail union and some drivers questioning management decisions, and from the other side with the enthusiast community and politicians attacking mainly the Chinese origin of the locomotives.

For the point of this article we are going to assume 80,000 km MDBF is a reasonable number. If the locomotives have a mileage of around 100,000 km per year as implied then this failure rate would be around 1-2 major failures per year. The data chart from RNZ shows even this figure is hard to achieve, with practically all of the locomotives in service at that time achieving about half that one year ago. The rate has been improved significantly since then, but the average is still only about 56,000 km and varies between generations of locomotives. Kiwirail claims that is acceptable for their current service expectations for their business.

It would be interesting to see a comparison between the DL class and other classes of locomotives in the system. The DL class use MTU engines and we would expect to see a high standard of reliability from these given the reputation of the manufacturer. The main alternator and traction motors are of Chinese origin, and we expect the control systems mostly are as well. The NZ mainline locomotive fleet at the present time is mainly the DL class and the GE built DX class (1972-1975) and its derivatives. There are a small number of DC class, which are fifty year old rebuilt EMD G12 locomotives from the 1960s, still operating, and there have also been a few rebuilt G22s from the late 1970s until relatively recently. It can be seen that until the introduction of the DL class most of the mainline fleet in NZ was pretty old. The NZ railway network traffic density does not justify a high level of investment and that’s why Kiwirail is happy with the mix of locomotives they currently have. They are planning to order 10 more DLs, probably so they can write off what is left of the DC class, and it is currently rumoured the DLs will soon be introduced on the Main North Line in the South Island. The scaremongering from certain elements of the railfan community that many of the locomotives would not last the distance has not been validated. As we have striven to point out, these locomotives are not high tech items, the technology needed to produce and maintain them being so well understood and easily engineered that unless major structural failures occurred, or the engines had a very short life, the locomotives are highly likely to remain in service for their expected life time. In fact given the norm in NZ there is also a high likelihood many of them could be extended to 3 million kilometres and 32 years service with a full rebuild after 16 years, as has occurred with our EMD/GE classes, if their basic structure is still in good condition at that time.