Kurier Kolejowy, Polish Specialized Media Outlet, Interviews Director of UTLC ERA

Overcoming Logistical Barriers in Europe: An Interview with Alexey Grom, General Director of UTLC ERA

Last week in Warsaw Joint stock company “United Transport and Logistics Company – Eurasian Rail Alliance” (JSC UTLC ERA) organized a conference for European operators of railway freight transportation in Europe to discuss challenges and prospects for development of international container transit between China and Europe.

Kurier Kolejowy: Mister General Director, I would like to ask you one fairly challenging question.
Alexey N. Grom: Go right ahead.

Kurier Kolejowy: You’ve come to Warsaw to demonstrate the potential of railway transportation of containers between Europe and China.What is the proposed volume of transportation and what is the new strategy of UTLC ERA? In a few words.
Alexey N. Grom: At present our company transports about 76% of some 370,000 containers that annually are transported by land between China and Europe. Every day we dispatch up to 15 container trains. It takes trains five and half days on average to travel from the border with China to the border with Poland. So our way of delivery is considerably faster that transportation by sea that might take up to six weeks.

Kurier Kolejowy: Alright, let us imagine that one of Polish global companies comes to you, say, KGHM Polska Miedź, a large company that deals with recovery of copper and metallurgy. Will you be able to help that company deliver their products to China?
Alexey N. Grom: Naturally, and the size of the company does not matter us. We do not care if our customers ship a train of copper or foods, such as rice: both companies will be treated according to the unified service standard of UTLC ERA.

Kurier Kolejowy: The present-day economy is based on delivery chains. You need to be able to cope with a chain of global automobile manufacturers, such as Volvo, which has production capacities in Europe and China. Sometimes the parts are delivered in both directions.
Alexey N. Grom: There’s nothing complicated in this. We have experience in serving Audi, Volvo, Porsche: we know how to transport cars to China. My work lies in the need to find new clients and the companies that we work with today serve as an excellent example. However, I would like to note that we not only transport expensive commodities of deluxe category, but also such commodities as foods, and in this area the volume of our transportation is growing.

Kurier Kolejowy: The trade between the powerful global economy of China and the Old World is booming. The volume of railway transport in it, however, is less than 5 percent. Such transportation is usually three times more expensive than transportation by sea. What is it that you are looking to change?

Alexey N. Grom: Our strategic goal is to increase the volume of our container transportation to one million TEU a year. In the long-term UTLC ERA could take upon itself up to 10% of the volume of transportation by sea. The potential of the existing broad railway track line is tremendous. Within a very short time we could triple container transportation, without adding considerably to investments in infrastructure and guarantee a 30 minute interval between the trains. The costs of transportation of one 40-foot container by railway could be practically fully offset by a much shorter delivery period as compared with transportation by sea; that would lead to considerable savings for our clients.

Kurier Kolejowy: Could it be perhaps that the difference in railway track width and the need to reload the containers at the border with Poland that scares away customers?
Alexey N. Grom: The transshipment process in Brest or other transshipment points before the cargoes enter the European railway infrastructure has not been an obstacle for quite a few years. The technologies are continuously upgraded. The infrastructure itself is developing. Our specialists have been working closely with their colleagues from Poland and other European countries to guarantee a solid foundation for growth. The best result for such mutually beneficial cooperation will be concrete transportation volume numbers, which are growing continuously.

Kurier Kolejowy: What challenges are you currently facing?
Alexey N. Grom: The most significant challenge for our company is increased interaction between all participants of the process: not only our shareholders but also other people who work on our joint business in different countries. The railway system has undoubtful potential for intensification of economic development that helps bring peoples of Europe closer. A railway is an excellent example of how our life can become better. It is not in vain that they say “Where the railway passes, there comes civilization.”
Author: Kurier Kolejowy – a specialized railway industry publication from Poland. Printed and online versions of the publication are available.