|
|
Recession puts brakes on pvt. box operators’ rake buying |
|
23/03/2009 |
| The economic slowdown has begun to deplete volumes of freight too, and with 20 per cent of the rakes owned by private containerised rail freight operators sitting idle for want of cargo, several of them have shelved plans of purchasing new rakes, preferring to rent them instead.
Of the 16 private operators, only six have their own rakes. The others are planning to rent them on the basis of demand on a profit-sharing model.
Since the rake owners have idle capacity, the non-owners may find it cost-effective to rent the rakes, explained Mr R.C. Dubey, President of the Association of Container Train Operators (ACTO).
"There is no fixed rental model yet. Rather, it is likely to happen on a case-to-case basis on a profit-sharing model," he elaborated.
DP World, which entered into the container rail-road business in 2007, already has seven trains of its own in the country. However, this year, according to the need, DP World might acquire more trains, but instead of buying them, it plans to lease the idle rakes.
"We currently operate seven trains. Whilst there are no plans to invest in more trains in the immediate 3-4 months, we will provide a service wherever and whenever our customers need one. We will look for opportunities to lease idle capacity from other players depending on the market potential and will review the terms of lease as and when these opportunities come up," commented a senior company official.
An idled rake costs Rs 30,000-Rs 35,000 per day. Hence, it will be profitable to rent out the rakes, at least on a short-term basis.
This is a new trend because of the slowdown due to which mainly the players in the ex-im business are hit. But this trend is not expected to last long. |
|
|
print
this page
