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Car disputes: what “Ukrzaliznytsia” didn’t take into account 10 freight cars went off the rails – what is next?

The inventory fleet of freight cars of “Ukrzaliznytsia” is worn out by 90%. The situation with the private fleet is a bit better: approximately 25% out of 65 000 cars are cars age of which exceeds 25 years. Such cars are usually out of repair, which poses risks to contract conclusions and cargo owners’ and shippers’ transportation plans. Who to blame for the existing situation and how to solve this issue, Alona Lebedieva, the founder of “Aurum Group” told Mind.

What happens in UZ? Thus, 90% out of 100 000 freight car units that belong to “Ukrzaliznytsia” is worn out and should be immediately withdrawn from use. The technical condition of these cars poses a real threat to the safety of both infrastructure facilities of UZ and population. The latest incident in Lviv region, where 10 freight cars went off the rails on April 9, confirms this point.

The real reasons for this incident are still unknown and this is a question appropriate authorities should deal with. However, a chronical lack of financing, outdated infrastructure of the railway, critical technical condition of the rolling stock, low wages and as a result, a shortage of skilled staff and often a neglectful attitude to duties – all these factors are evidence of the need for global modernization of “Ukrzaliznytsia”.

Patching the holes selectively, as it occurs now, is hardly feasible, as the chain reaction has already started: one issue derives from the other and leads to the third one. There is a bright example of this point. Just in February, UZ officials, informing about the objectives for 2018, claimed that 8 500 units were planned to be purchased with a view to modernizing the fleet of gondola cars, which would partially alleviate a problem of their acute shortage in the market.

Why does railway “help” RF? However, if the question of shortage of freight cars can be partially alleviated by newly built ones, the problem of wear and tear of the rolling stock of “Ukrzaliznytsia”, as it has been before, continues to be relevant, as nobody has cancelled the procedure of prolonging the service life of cars so far, which was established by UZ as temporary in order to reduce an acute shortage of the rolling stock.

However, as practice shows, there is nothing more permanent than something temporary. Ukrainian private operators import massively from the Russian Federation withdrawn from use cars, which are economically unviable to utilize on-site, as by solving the problem of shortage of gondola cars, Ukrainian companies offer Russian operators by 30-50% more for withdrawn from use cars than specialist utilization companies.

Having crossed the border, withdrawn from use cars undergo the procedure of prolonging the service life for 5-7 years, hosted by UZ and this junk continues to run on our railways. According to unofficial data, the number of such gondola cars with the prolonged service life, viz. more than 22 years, nowadays exceed 30 000 units in Ukraine.

Why do Ukrainian railcar manufacturing plants stand idle? Currently, a wide range of railcar manufacturing enterprises are operating in Ukraine, which is able to manufacture any kind of freight cars, however, they are not functioning at full capacity. There are no orders. UZ does not use existing capacities of Ukrainian enterprises but the local content is hyperhigh. More than 90% components, which are used for manufacturing of rail freight cars, are Ukrainian. This refers to metal, casting and all components, and these are additional jobs for hundreds of people, payments to the budgets of all levels.

Legendary Henry Ford, the creator of the like-named car, wrote away back in the last century, “All parts under competent management of an enterprise must be satisfied. If the community, employees and owners don’t find anything good in the existing enterprise, then there is something very wrong in the way it works.”