By Eamonn Ryan, derived from the podcast
In a podcast hosted by Peter Bruce of FM, Jamie Holley, CEO of Traxion, shared insights into the challenges and opportunities in the South African rail logistics sector. This article explores the challenges and opportunities within South Africa’s rail system, offering insights that are highly relevant to the cold chain industry. This is Part 2 of a 12-part series.
One of the most interesting aspects of Traxion’s operations in Africa is how quickly the landscape is changing. Six or seven years ago, Traxion operated primarily in South Africa and Mozambique, but today the company is present in nine countries across the continent. More and more nations are opening up their rail systems to private sector operators, which is driving innovation and improving rail logistics across the region.
Holley shares that the company applies for access to operate on state-owned networks in a process similar to what is being proposed in South Africa. Rather than tendering for contracts, private operators like Traxion apply for access to available network capacity. As long as they can prove their ability to deliver services, they are granted permission to run trains on those tracks.
This shift toward allowing private sector involvement in rail logistics has been a game-changer, enabling companies like Traxion to fill the gap left by underperforming state-run operations.
The future of SA rail logistics
The discussion turns to South Africa’s rail logistics sector. As the country seeks to address the issues facing Transnet, the state-owned freight rail company, Holley emphasises the importance of private sector investment in revitalising the industry.
“The challenges in South Africa are significant, but the opportunities are just as great,” Holley says. “Private sector involvement will be crucial in driving the necessary improvements, particularly in the bulk freight sector.”
The release of the Network Statement by the Department of Transport is a step in the right direction, outlining the need for infrastructure upgrades and increased train capacity. However, Holley believes that the real change will come when private sector companies are allowed to invest in new rolling stock, infrastructure projects, and improve overall efficiency.
Traxion’s experience in other African countries offers a roadmap for South Africa. By opening up the rail network to private operators and investing in modern equipment and technologies, the country can revitalise its rail system and unlock significant economic growth.
As Holley points out, the potential for growth is enormous: “Improved rail services, particularly in the bulk freight sector, can have a massive impact on the economy. If we can get the logistics right, the entire country stands to benefit.”
The conversation between Peter Bruce and Jamie Holley highlights the immense challenges and opportunities within South Africa’s rail logistics sector. While the country’s rail infrastructure has deteriorated, there is hope for a brighter future through strategic investments and greater involvement from the private sector. Companies like Traxion, with their proven track record across Africa, can play a key role in transforming South Africa’s rail system and driving economic growth. By learning from successful models in other African nations, South Africa can take meaningful steps toward revitalising its rail logistics sector and positioning itself for future success.