Insight

Why we’ve opted for the Rotterdam-Munich rail connection

Neele-Vat Logistics handles some 400,000 cargo transports per year between the greater Rotterdam area and the European hinterland. Indeed, every day, countless trailers filled with cargo pallets leave the port for Germany, Italy, the UK and other European destinations. The company relies on rail to transport freight from and to Munich. Neele-Vat Logistics Director Peter Vinke talks about this remarkable decision, broaching on subjects like VAT reverse-charging, multi-system locomotives and the wages of Eastern European drivers…

Neele-Vat Logistics specialises in groupage transports from Rotterdam to a large number of European destinations. Some 70 percent of these transports are port-related – i.e. the consignment is shipped from a Container Freight Station (cross dock for groupage freight) or a logistics distribution centre. Since 2013, Neele-Vat Logistics has been using the intermodal rail connection between Rotterdam and Munich for its shipments to and from the Bavarian capital. “It’s a reliable connection that enables us to also transport continental groupage shipments via rail in addition to regular deepsea container shipments. Fairly unique along this particular route,” explains Vinke. By continental shipments, Vinke not only means Dutch cargo produced by shippers in the region, but also goods that were originally manufactured in Asia, after which they are re-packaged or handled in the Rotterdam port.

Modal shift
There’s stiff competition from road hauliers in the continental transport sector, but this doesn’t prevent Neele-Vat Logistics from ‘staking its cards’ on rail. According to Vinke, Rotterdam to Munich is an ideal distance for introducing a modal shift, although the carrier has to be able to count on a reliable, swift, high-frequency rail connection. In this case, shuttle operator TX Logistik/EGS is able to transport freight from Rotterdam to South Germany within the space of 48 hours. The firm’s interoperable, multisystem locomotive, fitted with both a Dutch and German safety system enables it to avoid delays at the Dutch-German border. “In contrast with deepsea shipments, which can take up to 30 days to reach their destination, there’s no room for even a day’s delay in continental transport. You’re always working under time pressure. In that regard, we are pleased that our operator, TX Logistik/EGS, recently stepped up the frequency of its Rotterdam-Munich schedule from three to four runs per week,” says Vinke. “We can really use that extra flexibility. And the frequency is expected to be raised even further in the near future. Another step we would really welcome.”

EU measures
Incidentally, Neele-Vat Logistics’ decision to opt for rail at this point was not based on economic considerations per se: for the moment, the costs of the two different modes are more or less equal. Rather, the logistics company intends to prepare an effective response to expected developments like the German Maut, the future shortage of driver and pay increases for Eastern European drivers. “Right now, wages for Eastern European drivers are well below Western European standards, but it is highly likely that the EU will be taking measures intended to introduce a level playing field,” says Vinke. That is why in the longer term, he expects rail will also present economic advantages compared to road transport. At the same time, Vinke forecasts a marked increase in cargo volumes offered for transport, making it impossible to satisfy shipping demand without recourse to rail. And finally, Vinke has observed a growing demand among clients for sustainable transport solutions. “In this context, rail has many advantages over other modes of transport. If rates are more or less comparable, this may well determine which mode a client ultimately decides on.”

First port of call
Despite the reliable, rapid Rotterdam-Munich connection, many shippers and freight forwarders in Bavaria are still strongly focussed on German ports. According to the Neele-Vat Logistics director, while Rotterdam has a lot of advantages to offer German companies, in many cases these potential clients are simply unaware of them. For example, Rotterdam is actually the first port of call for most deepsea carriers – resulting in time savings of some two days compared to ports in Germany.

Tax advantages
Another significant advantage pointed out by Vinke is the opportunity Rotterdam offers shippers and freight forwarders to benefit from a business-friendly tax climate and favourable customs arrangements. For example, German companies active in the Rotterdam port are allowed to reverse-charge VAT; while in Hamburg, they are required to pay it upon receipt of their shipment and can only claim a return after three months. This affects the importer’s liquidity. The director of Neele-Vat Logistics can name other advantages besides: “Rotterdam boasts an extremely extensive shortsea network. The port is an ideal hub for continental cargo flows from and to the UK, Scandinavia and the Baltics. You can choose from an extensive range of shipping schedules. And our rail product connects seamlessly to these services. Including when you’re looking for a groupage solution.”

Source: Rail Cargo

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