Trainload Freight - History

History

Trainload Freight (TLF) was created in 1988 as the sector of British Rail responsible for operating unit trains; the division was subdivided into four sub-sectors based on cargo carried; Coal, Construction, Metals, and Petroleum. Other wagonload freight activities and also containerised freight were organised in the Railfreight Distribution (RfD) division at the same time. The trainload business represented approximately 80% of British Rail's total revenue from freight, and 90% of freight traffic by mass. Trainload Freight was the only consistently profitable freight sector within British Rail.

In 1988 the company was authorised to acquired 100 British Rail Class 60 locomotives, at a cost of approximately £124 million.

In 1992 the company had revenue of ~£500million, and made a profit of £67.5million; this exceeded government targets of a £50million profit, returns on capital assets were typically over 8% in the late 1980s prior to the early 1990s recession. British Rail was able to charge a 45% margin on basic costs in 1989 for coal transportation prior to the privatisation of the electricity industry, after which less profitable contracts were negotiated; post 1990 up to 1994 the sector undertook further exercises to increase profitability; discrimitary pricing was employed- approximately 10million tonnes of unprofitable freight had been identified, of which 70% was retained under new working conditions and pricing arrangements, the remaining 3 million tonnes was lost - much of it freight transport for the cement industry. Cost cutting measures included 20% reduction in employees, 50% reduction in locomotives, and 40% reduction in wagons - this resulted in rail freight transport being reduced to under 100million tonnes per annum in the lead up to privatisation, a modal share of under 5%. Approximately 250 kilotonnes of coal were being transported per day by the company by 1993.