Securing wagon investments offer diverse freight operations

CFL cargo is a new player in the market of rail freight, created on 17 October 2006 when the cargo division of the national railway company of Luxembourg, CFL, merged with the internal rail division of the Luxembourg mills of ArcelorMittal, the world leader of the steel industry. This background enables the new company to benefit from both shareholders’ in-depth expertise in railroad operations, client-oriented distribution and safety.

The objective of CFL cargo is to offer a customer-oriented pan-European door-to-door service, while creating shareholder value as well as adhering to high social, safety and environmental standards.

CFL cargo started expanding its activities beyond Luxembourg as soon as the liberalisation of rail freight in Europe became enforced on 1 January 2007, by launching feeder traffics in the surrounding SaarLorLux region – home to several production sites of ArcelorMittal. While steel products still represent a major part of CFL cargo’s traffics, the company is aiming to diversify in handling other merchandise and currently transports products such as paper, chipboard, construction materials and chemicals.

In addition, the rising costs of road transportation due to increasing congestion, increasing tolls and growing environmental concerns have contributed to a renaissance of freight railroad in Europe. The renewed appeal of rail freight allows operators to compete efficiently and to regain market shares.

The strategic location of Luxembourg, in the heart of Europe, enables CFL cargo to operate the main European North-South and East-West routes in cooperation with its subsidiaries CFL cargo Deutschland and CFL cargo Danmark. Several international traffics have been launched, with destinations in France, Italy, Spain, Germany and Denmark.

In the area of rail freight, CFL cargo offers a full service range, including:

• Regional rail freight, including composition and reception of national and international trains in the Bettembourg marshalling yard, as well as feeder services and management of private rail sidings
• Long distance freight transport, i.e. planning and implementation of international freight trains
• Rental of wagons fitting the customers’ needs
• Services offered to other rail companies (technical wagon inspections, rental of personnel and locomotives, issue of waybills and handling of customs formalities)

The resources of CFL cargo include a fleet of:

• Five multi-system electric locomotives for international long haul trains
• 30 diesel locomotives for regional feeder trains
• 25 diesel locomotives for shunting operations
• 3991 wagons

In 2007, the CFL cargo fleet transported more than eight million tonnes and the company reported a turnover of €120 million.

Details of the CFL cargo wagon fleet, by category

Table 1 gives details of the CFL cargo wagon fleet.

1326 of these wagons are rented (especially Shimmns & flat wagons) from wagon rental companies. 177 wagons are rented out to other railway undertakings and the CFL Infrastructure Division.

As one can see, the main categories are flat wagons and wagons for transporting coils, due to the historical fact that the Grand-Duchy of Luxembourg has had a strongly developed iron and steel industry since the midst of the 19th century, and has been using the national railroad company CFL for railroad transportation. As a consequence, ArcelorMittal Luxembourg is currently still the main customer of CFL cargo.

Some key points about the different wagon categories

25-metre-long flat wagons

As the Luxemburg steel industry is specialised in long steel products such as beams and sheet piles, we have one of the biggest fleets of 25-metre-long flat wagons in Europe. In February 2009, additional new extra-long wagons will leave the factory in Bulgaria to head for Luxembourg (see details to follow).

Fans wagons

For scrap transports, we have developed a new type of wagon called Fans, starting from the Eaos-wagon. The Fans wagon is reinforced to be better suited for the handling of scrap. It has reworked doors, end-walls doubled with poplar-wood and more.

Lkmmpss

We transformed 169 Kps wagons into Lkmmpss wagons by adding a steel plate of four tonnes to the wagon in order to increase its weight; this makes it possible to use the wagon as a match wagon for the Rbps wagon, allowing transporting lengths of more than 30 metres without any restriction throughout Europe.

Transformed Rils-wagons

To satisfy the special needs of our steel customers, we transformed the Rils-wagon by adding 13 cradles for the transport of small coils (five tonnes) or stanchions connected by chains for wire transport. In response to another steel customer’s request, we added movable rails to this wagon type for the transport of palletised coils.

Ateliers de Pétange

Most of this important transformation work is done by Ateliers de Pétange, the certified repair shop and subsidiary of CFL cargo.

CFL MultiModal

CFL cargo does not own wagons for combined traffic because these operations are handled by the sister company CFL MultiModal in the container terminal of Bettembourg. Exception: 12 Slps-wagons of the ACTS-system (Abrolltransportsystem) transport coal dust from the Mosel river harbour to a cement factory.

Tank wagons

The same situation applies to tank wagons: even though CFL cargo is in charge of traction for the petrol industry in Luxembourg, our customers rent these wagons through specialised firms.

Internal transport

The last component of our fleet management is a group of 400 wagons used for internal transport between the steel mills. These wagons are not circulating outside the industrial railroad network interconnecting the steel mills in Luxembourg, therefore they are not included in our figures.

Recent developments in the CFL cargo wagon fleet

In early 2008, CFL cargo added 160 new Shimmns wagons to its fleet through long-term rental contracts.

60 of these wagons were built in the Polish factory Wagony Swidnica (Greenbreier Europe) by order of the German firm European Rail Rent, Duisburg. This firm is also one of the biggest providers of our rented Rbps-wagons.

100 additional Shimmns wagons were built in Slawony Brod, Croatia, by DuroDakovic. In this case, the owner is the German company On-Rail-Vermietung-Moers. For Duro Dakovic, it was the first order for West Europe because during the cold war they specialised in tank and military vehicle production.

The products of the Polish and the Croatian factories are of a very high standard and in particular, the anchor arms for the coils are well constructed.

In February 2009, 25 additional Shimmns wagons will be delivered from Duro Dakovic.

In addition, CFL cargo purchased 540 25-metre-long flat Rbnpss wagons from the German company On-Rail-Mettmann. These wagons will be added to CFL cargo’s existing fleet of 849 extra-long wagons.

These Rbnpss wagons are being produced at the Transwaggon production site in Burgas, Bulgaria, on the coast of the Black Sea. The finished wagons will be delivered at a rate of 20 wagons per month from the beginning of 2009 onwards.

Over the course of the next two years these extra-long flat wagons, which are designed especially for the transport of long steel products produced in Luxembourg, will be heading for destinations all over the world.

As already mentioned, this addition to its fleet will position CFL cargo as the undisputed leader in the transport of long products.