What does this do for capacity?
“The aggregates hopper market is pretty stagnant. There’s not really a lot of growth area for that. There are some big fleets, probably ageing. With the demise of coal there have been loads of coal wagons that are no longer fit for purpose.”
Armstrong is leaving the business, with GBRf Head of Estates Liam Day taking on his aggregates work. Day is now GBRf business manager.
“At the minute I look after GBRf’s property interests, so it does fall hand in hand with aggregates,” he says.
Day’s previous job was about maintaining existing locations, finding new ones and work for them. Wellingborough was a prime example.
Ten years ago GBRf signed a deal with Metronet to operate infrastructure trains on the London Underground, as part of the ongoing renewals programme on the Tube. This meant the company needed strategic sites to stable trains and load material, and it identified Ferme Park and Wellingborough.
The latter had been a disused yard that was brought to life by the LU deal, but there was little work after that contract ended. Now a deal has been signed for Aggregates Industries material to move there from the Mendips.
Says Day: “It’s building on some work I’ve been doing over the last year with GBRf - looking for new locations that we can look to develop. It’s all about road to rail conversion where we can.”
One of his recent successes was the setting-up of Cricklewood as a terminal, which is already helping the business grow.
For Day, it has recently been a case of Armstrong trying to win work, and then him trying to find a location where GBRf can run into.
“There’s no use just having a siding,” he explains. “You need the land there, and the road access that’s required for it.”
Armstrong says that this work has highlighted concerns: “The work we’ve done together on that shows that land is quite an issue. Network Rail is trying to sell off large chunks of land. What were strategic freight sites are potentially going to be sold.”
Does that mean GBRf must act fast to submit an application to use the land, if it thinks the site offers potential?
“We do, but there’s other things you have to do. You’ll see with the strategic freight sites, at interchanges - that’s the sort of stuff that needs to be developed, almost to the point that we’re looking at commercial sites where there’s a rail connection next door to it. Is there anything we can do with that commercial site, like an industrial estate? But the problem with that is the land rents. In London, industrial estates are so high that trying to get things to stack up is quite difficult.”
Euston Downside is cited as an example. Says Day: “Because land in London is so scarce, from our perspective it would be silly to focus on finding a bit of land to supply just one job, and to work on one job.”
He highlights Cricklewood: “It’s brilliantly placed for the sort of traffic that we’re running, to be able to call on a number of jobs that would rely on Cricklewood as a location.”
Obviously GBRf is not just London-focused. Says Day: “It tends to be on the short-term side of things. Your aggregates and spoil operations are what you can focus on between now and (say) 18 months/two years down the line. The bigger intermodal-type locations, you need to take more of a strategic view - they take longer to come into fruition. So we have people who work on those in the company as well.”
How does Day see the aggregates market developing?
“There’s growth there. Of the markets we’re looking at growing, that is one of them. We try and strengthen our position as much as we can and look to facilitate any newcomers to the market.”
Is there interest from people new to rail?
“We’ve got quite a few enquiries, yeah,” he nods. “We have customers and suppliers either end - we’re just trying to find a package with the land, rail haulage and handling, and try and make it work for them.”
As for rail’s unique selling point against road right now, Day says that depends upon the product, and on the distance that product is being carried. That dictates the price.
“But also in London, it’s the local authorities pushing people away from lorries coming through London,” he adds.
It has been said previously within the freight industry that often a freight train needs journeys of 170 miles to 200 miles to be profitable. In the aggregates market, that can never be the case for journeys across London. Is there a distance in London below which it becomes unviable?
Armstrong explains: “It’s dependent on how much you can ‘sweat the assets’. You can do two trips per day. For instance, if it’s at Leeds and Hull, that locomotive and that set of wagons does two trains a day. It’s the same in London - if you can do two or three trips a day with the set of wagons to keep the stuff moving.”
That thinking is the reason why Ferme Park is being retained. Getting paths on the Midland Main Line is difficult, and Armstrong explains that the North London facility can be a strategic rail hub to increase the volume of through traffic, and for staging trains.
Armstrong gives an example of distance and ‘asset sweating’: “We’re looking at quite a long-distance journey for a new client. We can’t get a 24-hour rotation on a set of wagons, which is the killer for him. But we’ve said if we can do enough to fill two sets of wagons we can allocate more assets and stage them into Ferme Park to allow the contract to work.
“So although we don’t get a 24-hour rotation, we’ve got assets to do the equivalent over the week, and we can hit the timings. That’s the key - it’s about volume really. If you can get us some more volume, we can run it.
“With London you’ve got six hours a day (three in the morning and three in the evening) when you can’t run trains. That train has to stay somewhere, wait for the peak to go, and then go. If you have a staging point that means you can stage wagon sets.”