Industry sceptical about TFR’s cost-cutting claims

South African businesses are not convinced that efforts by Transnet to move freight from road to rail will cut costs. According to the 2009 supplychainforesight survey launched in Johannesburg last week by Barloworld Logistics, most of the 259 respondents who participated in the research that crossed over nine sectors ranging from automotive to building, construction, engineering and retail, were of the opinion that there would be no cost reduction in using rail. Said Barloworld Logistics divisional director: consulting and software Johan Dekker: “Companies don’t see any cost advantages in using rail despite Transnet’s R80 billion infrastructure upgrade.” He said from responses received it was clear companies would only revert back to moving freight on rail if they were convinced it would increase service delivery. “The research did show though that companies believed that rail freight would increase if a national freight logistics strategy was implemented. While many were aware of the government initiatives to improve infrastructure and understand the necessity for a multimodal transport strategy, the perception remains that costs will not be reduced with rail initiatives.” Dekker said at least seven out of ten companies interviewed in the research were of the opinion that they were involved in the development of infrastructure. “We also found that while reducing the supply chain carbon footprint was becoming increasingly more of an issue for companies, it was not a priority at present.” Dekker said while most industries acknowledged the importance of having environmentally friendly supply chains, it remained at the bottom of agendas. This, he said, could be due to the growing economic crunch that has seen costcutting initiatives becoming a priority.