Rail freight transportation offers a green vision for current and future plans

Železničná spoločnosť Cargo Slovakia, a.s., (ZSSK CARGO) is a strategic rail transportation undertaking in Slovakia with a transported volume market share of approximately 95%. It is a company with the densest network of tariff points within Slovakia and key transhipment whilst pumping through capacities to the border with Ukraine.

Who we are

ZSSK CARGO was established on 1 January 2005 by the division of the original passenger and freight operator in Slovakia. The company’s activities are built on a history of over 160 years. The founder and shareholder of ZSSK CARGO is the Slovak Republic, represented by the Ministry of Transport, Posts and Telecommunications. The supreme control body of the company is the ZSSK CARGO Supervisory Board. The statutory authority is the ZSSK CARGO Board of Directors, Chaired by the company’s CEO, Mr. Matej Augustín.

The company’s mission is to provide reliable, safe, environmentally friendly and affordable rail freight services based on customer needs and requirements. The second main product is the provision of services related to rolling stock rental, its maintenance and repairs.

The company’s vision is to be a dynamic, modern and recognised transport company with a stable share of the transport market. The company’s development is focused on long-term financial stability plus maintaining the current market share in the transport market within the Slovak Republic and the European Union. Competitiveness in domestic and international markets, ensuring a sustainable customer satisfaction and performance improvements are all high priorities of the company.

The company’s changes in management

In 2007, ZSSK CARGO introduced a project management scheme with the aim to streamline administration, to increase efficiency and to reduce labour costs. The results of the project management were to come within two years of running more than 50 projects.

Shimmns wagons are designed to transport thin steel tin coils

“We can assess the year of 2008 as the year of stabilisation, especially in terms of ZSSK CARGO’s core business – goods transportation. The comprehensive and clear business strategy that we applied in 2008 yielded positive results,” explained CEO Mr. Matej Augustín.

In 2008, ZSSK CARGO recorded its first ever profit of 83 million Slovak crowns despite the decline in traffic performance in the second half of the year and the influence of the global financial crisis on world markets. “These achievements are proof that changes launched through project management within the company were justified and have brought success,” boasts Mr. Augustín.

Constitution and adoption of the business plan for 2009 had been influenced by the global financial and economic crisis. This crisis hit the industry with the highest share of ZSSK CARGO shipments, i.e. metallurgical industries, chemicals and construction. The steel industry alone accounted for more than 60% of volume shipments of our company.

“The trade policy for 2009 had to cope not only with a decrease in industrial production, but also with competitors represented by the other rail carriers and particularly road transport, where the price level fell by 30%,” explains Mr. Augustín. He adds: “The basic objective was, together with crisis management measures, to ensure funding for the functioning of the company without negative impact on quality and customers satisfaction. After an evaluation of 2009 it is possible to say that we achieved our goals and thanks to a comparative recovery in industrial production in the second half of the year we have even exceeded the original plan of traffic volume.” One of the commodities with the highest year-on-year growth was intermodal transportation.

Sggmrss wagons designed for containers and swap bodies transportation. Flat articulated freight wagon Sggmrss 90 is designed to transport bulk 20, 30, 40, 45 foot containers and swap bodies

Position

The rail network connects Slovakia with seaports. ZSSK CARGO currently provides transportation of goods within intermodal transportation in the form of block trains from five ports: Koper (Slovenia), Rijeka (Croatia), Rotterdam (Netherlands), Bremerhaven and Hamburg (Germany). Container transportation to the Russian and Asian markets becomes gradually commonplace. ZSSK CARGO has had its first experience with the container transportation from Southeast Asia to Central Europe. Containers from broad gauge wagons were transhipped to normal gauge wagons at the intermodal terminal in Dobrá, located in close proximity to the border with Ukraine. The company has established long-term cooperation with TransContainer Russia, to which the terminal in Dobra has been.

To strengthen company’s activities abroad, homologisation of Slovak locomotives has begun on Polish and Hungarian infrastructure. By joining the Schengen area, Slovakia has become a Schengen border country with its eastern Ukraine border. This brought some decline in 2009 in commodity flows in this important rail crossing due to disputes on the safety of use of the scanner on the border point Uzhgorod-Maťovce, which has been finally declared as safe by an independent expert team from the International Atomic Energy Agency.

In 2009, the operation of reconstructed pumping through complex was launched at the border with Ukraine in Čierna nad Tisou. In terms of capacity, technology, safety and environmental protection, it is the only complex of its kind on the Eastern border of Schengen

In 2009, ZSSK CARGO’s performance was also marked by the transition to the Euro as currency. The fact of weakening currencies in neighbouring countries against the Euro made competitor services cheaper mainly in the east-west and north-south directions. Despite the revenue slump of the transportation, ZSSK CARGO is investing heavily – particular in the field of mobile equipment and technology.

“In order to meet the market and customers’ needs, we have updated the rolling stock,” explains Mr. Augustín. He continues: “Another investment was the reconstruction of pumping through a ‘complex’ at the border with Ukraine in Čierna nad Tisou. The ‘complex’ is designed to pump liquid commodities transported by broad gauge rail networks to standard gauge rail tankers. The aim of this investment was not only to increase the volumes, but to respect environment and this enabled us to build an extraordinary workplace of its kind in the Schengem area,” says Mr. Augustín.

At the moment, a new high-capacity rotary tippler bulk substrate in Čierna nad Tisou is in pilot operation. This mechanism allows transhipment of 27 broad gauge wagons in two hours. A newly reconstructed thawing plan for the bulk substrates with a daily capacity of 108 wagons ensures a year-round performance.

ZSSK CARGO is a customer oriented company that tries to achieve the highest degree of quality services for its customers. The company management fully supports the activities associated with implementation, maintenance and dissemination of quality management systems. ZSSK CARGO possesses certificates of quality in terms of international standards EN ISO 9001:2009 for the following products:

• Rail freight transport (logistic trains)
• Maintenance and repair of rolling stock
• Optimising the logistics chain, goods and services procurement, sale of assets, selection of suppliers, stock management services, energy procurement services and car transport
• Eastern Slovak Transhipment Yards

Wagon Sggmrss during reloading of Corean containers in intermodal terminal in Dobra

There is no future without the past

ZSSK CARGO management esteems the history and traditions of rail transport. This history is the basis of current market position of rail freight carriers, and it’s a springboard for the future. Being a modern and dynamic company does not mean we have to forget the past.

“We respect the work of rail fans who spend their free time by reviving the unique historical railway heritage. An example is our help to launch the 55-year historical steam locomotive Albatross. Of course we support numerous events directly related to the presentation of the past for the current generation.”

ZSSK CARGO provides its customers a broad product portfolio, including:

• Transportation of wagon consignments by single wagons, block trains and integrated logistics trains, using logistic method just-in-time
• Intermodal transportation, including planning and transport management, customer needs analysis, preparation of tenders and contracting, transportation, trade, tariff, technology and technical conditions of carriage
• Siding services, which include transport and ancillary services
• Automotive services, relating to shipments of components and production of automotive industry in Slovakia
• Services of Eastern Slovak Transhipment Yards which is a strategic transhipment point for two railway gauges and transport modes SMGS and CIM
• Additional support services such as transport-procurement services, rental of wagons, security consultant services, information services, rolling stock services and special consignment transportations

Apart from its main activity of the execution of transport and business activities on track, ZSSK CARGO also executes:

• Maintenance and repair of tractive vehicles, freight and passenger wagons
• Inspections, examinations, tests and measurements of railway rolling stock
• Construction changes of rolling stock
• Services of mobile workshops
• Road transport services

Activities in international organisations and projects

ZSSK CARGO cooperates bilaterally and multilaterally with partner companies and international organisations in order to promote the interoperability of freight transport in the East-West direction and vice versa. ZSSK CARGO also develops Central Europe links with Adriatic ports. The company is a member of several international organisations including, among others, UIC, CER, CIT and OSJD. The experts of ZSSK CARGO are members of various working groups within international organisations that are focused on research and development, rolling right, protection of the environment by the use of sustainable energy sources with minimal CO2 emissions. Since the safety of rail transportation is very important to us, the international cooperation is focused on the planning and coordination of freight schedules and assistance with streamlining of the train paths allocation. ZSSK CARGO has its general representations in Austria, Ukraine and Poland.

Matej Augustín

About the author

Mr. Matej Augustín has been the Chairman of the Board of Directors and Chief Executive Officer of ZSSK CARGO since 2006. Prior to that he worked in the audit company KPMG, mobile network operator Eurotel and bank institution Všeobecná úverová banka – Gruppo Banca Intesa. He graduated from finance and audit at the Comenius University in Bratislava.