RIFT VALLEY RAILWAYS ADDS 480 NEW WAGONS TO FLEET
(Posted 06th October 2015)
The phrase that competition is good applies to many economic arenas and the railways in East Africa are no different.
The upcoming brand new Standard Gauge Railway from Mombasa via Nairobi to the Ugandan border and on to Kampala, being built at a record pace, is a case in point as its arrival on the scene triggered some major strategic investments by the existing railway operator, Rift Valley Railways.
The present narrow gauge railway, which over decades of state neglect in Kenya and Uganda lost its market share to the regional trucking companies, has under their new management of course seen the writing on the wall and acted accordingly.
Following years of shareholder wrangles, largely attributed to former lead shareholder Sheltam of South Africa, at one point risked the long term concession to be withdrawn and prompted the two government to set stringent performance conditions and targets to be met or else. On the scene came Egypts Citadel, now known as Qalaa Holdings which has since acquired an 85 percent majority shareholding in Rift Valley Railways, with the remaining 15 percent held by a Ugandan investor.
With boardroom wrangles a thing of the past has the company over the past two years embarked on major track refurbishments in both Kenya and Uganda, where the most accident and delay prone sections were completely overhauled. Track maintenance equipment was introduced, speeding up regular maintenance work tenfold and the launch of both an electronic cargo monitoring system and a training simulator for new train drivers has shown positive results.
The company imported 20 brand new locomotives from General Electric in the USA while progressively overhauling the present locomotive fleet, all resulting in higher haulage values and faster transit speeds, now down to just three days from Mombasa to Kampala when only counting the drive time of the trains.
The company however is getting ready to make yet more investments and just announced the purchase of 480 brand new rail wagons, which will, when all delivered, increase haulage capacity by 50 percent. In fact 120 new wagons are due to arrive in Mombasa in November, the first of four batches of deliveries at a unit cost of some 53.000 US Dollars, purchased from China.
Combine all these various measures and given that the rail line is operational already, will RVR no doubt be good and ready when the new SGR comes on line in a few years’ time, ready to compete over both tariffs as well as only marginally lower speeds.
Speaking during the 6th East and Central Africa Rail and Road Infrastructure Summit that was held at Villa Rosa Kempinski Hotel in Nairobi last week, RVR’s General Manager, Concession & External Communications, Mr. Sammy Gachuhi confirmed that they had already procured 120 wagons which they expect to arrive in the country in November.
‘The 120 wagons purchased from China CNR Corporation at USD53, 000 per unit will increase fleet size and enable RVR to move up to 60 tonnes on each wagon compared to 40 tons allowed in the current wagon fleet’ he said.
He then pointed out that RVR is currently at the midpoint of a sh25 billion (US$ 287 million) capital expenditure program that began in January 2012 to revitalize the railway. ‘Since the start of the renewal program, RVR has invested sh11 billion (US$ 126 million) in modern rail operating technology, rebuilding infrastructure, expanding haulage capacity and developing modern rail operating skills in its 2,400 strong workforce.Rising freight volumes, declining incidents and less blockage time are a testament to the success of the range of measures so-far implemented under the turnaround program — from GPS-based navigation and scheduling to the reconditioning of track and rolling stock — is attracting new customers, including Vivo (formerly Shell Kenya), Lafarge Cement and others looking for safe, efficient, reliable alternatives to road transport’.
Clearly, the new SGR will not have it all their way, not at least if RVR has anything to do with it and the massive capital cost, which need to be reflected in the haulage tariffs, will prove to be a challenge the SGR operator will have to face up to if they want to repay the loans and make some profits. A long term added management contract to run the inland container depot in Mukono just outside Kampala will only add to the operational capacity which has been created by the new RVR team after errant former shareholders have been kicked out or bought out.
One remaining issue though and no doubt will RVR’s Chairman of the Board Dr. Titus Naikuni be more aware of that than others, is passenger transport. The once upon a time double daily passenger train between Nairobi and Mombasa and vice versa, leave alone passenger trains to Kisumu or even Kampala, have been scaled back significantly. The Mombasa train now only runs three times a week and passenger rail transport to Kisumu and Kampala has been shelved altogether. While it is understood that RVR’s core business is cargo it is nevertheless hoped that passenger operations will one day fully resume, if for nothing else but to bring back a tourism attraction which would draw perhaps tens of thousands of rail aficionados to East Africa to sample the line which was a hundred years ago called both the ‘Iron Snake’ and the ‘Lunatic Express’.
One Response
The 20 locomotives imported from the USA were not “brand new”. They were second hand, originally built in the late 1970s or early ’80s.