KiwiRail
Company type | State-Owned Enterprise |
---|---|
Industry | Rail transport,shipping, property management |
Predecessor | Toll NZ |
Founded | 1 July 2008 |
Headquarters | , New Zealand |
Area served | New Zealand |
Key people | Peter Reidy (CEO),[1] David McClean (Chair)[2] |
Products | Great Journeys New Zealand |
Services | Rail freight Inter-island ferries Long-distance passenger rail |
Revenue | NZ$682.9 million[3] |
NZ$25.7 million (FY2018-19)[3] | |
NZ-$324.9 million (FY2018-19)[3] | |
Number of employees | 4,213[4] |
Divisions |
|
Subsidiaries | KiwiRail Limited |
Website | www |
KiwiRail Holdings Limitedis a New Zealandstate-owned enterprise(SOE) responsible for rail operations in New Zealand and operates inter-island ferries. Trading asKiwiRailand headquartered at 604 Great South Road,Ellerslie,KiwiRail is the largestrail transport operator in New Zealand.KiwiRail has business units of KiwiRail Freight,Great Journeys New ZealandandInterislander.[5]The company was formed in 2008 when the governmentrenationalisedabove-rail operations (having previously renationalised the network in 2004) and inter-island ferry operations, then owned by Toll Holdings. In 2021, the government launched the New Zealand Rail Plan, with funding for rail projects to come from the National Land Transport Fund (NLTF), and with KiwiRail remaining an SOE but paying Track Access Charges (TACs) to use the network.
History
[edit]Background
[edit]Prior to the establishment of KiwiRail, rail transport in New Zealand has been under bothpublicandprivateownership. Government operators included thePublic Works Department(1873–1880),New Zealand Railways Department(1880–1982), and theNew Zealand Railways Corporation(1982–1990).New Zealand Rail Limitedwas split off from the Railways Corporation (which continued to own the land beneath the rail network) in 1990, privatised in 1993 and then renamed in 1995 toTranz Rail.In 2004 Tranz Rail's rail, ferry and trucking operations were acquired byToll Holdingsand renamedToll NZ,with the central government buying back the rail network outside of Auckland for $1 (the Auckland metro rail network had already been purchased by the government in 2001). The rail network then came under the New Zealand Railways Corporation (trading as ONTRACK). As part of this acquisition, Toll agreed to pay ONTRACK "Track Access Charges" (TACs) in exchange for exclusive network access for 66 years, subject to a "use it or lose it clause": if freight and passenger volumes fell below their 2002-2004 average for three or more years, Toll would lose its exclusive access.[6]The agreement set a base track access fee but left future track access fees open to negotiation between ONTRACK and Toll.[6]After several years of negotiations, the two parties could not come to an agreement on the amount that Toll should pay.[7]
Establishment of KiwiRail
[edit]On 1 July 2008, the government announced the purchase for $690 million of Toll Rail, the rail and ferry assets of Toll NZ, but not its trucking operation, which continued under the Toll brand.[8]The new company was named KiwiRail and launched on 1 October 2008 at a ceremony at Wellington railway station.[9]The New Zealand Railways Corporation then owned both KiwiRail and ONTRACK, with both companies merging to create one company that controls both rail and ferry operations and rail infrastructure.[10]
Former Prime Minister Jim Bolger became the first chair of the KiwiRail board, a position he held until 1 July 2010. Bolger's government had privatised New Zealand Rail Limited in 1993. A number of commentators,[9]includingWinston Peters,view this as ironic. In response, Bolger acknowledged his involvement in privatising New Zealand Rail, remarking that "my life is full of ironies,"[11]and added that "the world has changed."[9]
Splitting of land and operations
[edit]In 2011, KiwiRail proposed splitting its land and rail corridor assets from its rail operation assets.[12]On 27 June 2012 it was announced by the company that the value of the land and rail operations would be written down from NZ$7.8 billion to $1.3 billion, and KiwiRail would continue as the rail and ferry operator, while the New Zealand Railways Corporation would manage KiwiRail's land.[13]The de-merger took effect on 31 December 2012.[14]
10-year turnaround plan
[edit]In 2010 KiwiRail released a 10-year turnaround plan and significant government investment in support of this in the years following. In support of the turn-around plan, from July 2008 to December 2016 KiwiRail received over $2.1 billion of Crown investment, which was mostly spent on infrastructure and new rolling stock.[15]
The focus of the Plan is to increase rail traffic volumes, revenue and productivity, modernise assets and separate out the commercial elements of the business from the non-commercial.[16]
The plan included the following points:[16]
- "Step change" on the Auckland – Wellington – Christchurch trunk route:
- Reduce transit time and improve reliability along the route by easing curves, removing speed restrictions, greater investment in renewal of bridges and sleepers and passing loops. An express freight train journey between Auckland and Wellington took thirteen and a half hours. KiwiRail aimed to reduce transit times to 11 hours.
- Improve exit and entry from Auckland and Wellington with improvements at terminals and on main lines to reduce transit times and conflicts with commuter services
- Increase ferry rail-freight capacity by extending the length of theAratere(achieved 2011) and make theKaitakirail-capable (idea since abandoned)
- Improve reliability, capacity and enabling investment:
- Increased renewals on "other key routes", including investment in sleeper replacement, bridge strengthening and track formation refurbishment.
- Improved IT systems and processes, equipment and facilities at terminals
- New locomotives (seeDL class) (48 in service by 2017) and 3,000 new wagons (over 1,000 in service by 2017).[17]
- Review of minor lines (close or mothball if no anchor customers emerge):
- North Auckland Line(partial mothball 2016)
- Stratford–Okahukura Line(mothballed 2009)
- Napier – Gisborne Line(partial mothballed 2012)[18]
- North Wairarapa line.
- Clarify and assign costs associated with Auckland and Wellington metro services (resulting inTranz Metroassets being transferred to theGreater Wellington Regional Counciland contracts for running services being made "contestable", as in Auckland.
Two of KiwiRail's major customers,MainfreightandFonterra,invested heavily in rail-related infrastructure in line with the Turnaround Plan. Mainfreight has allocated $60 million for investment in new railhead depots, while Fonterra has invested $130 million in a new rail hub complex in Hamilton and another inMosgiel.[19]
The plan has had mixed success, with company Chairman John Spencer stating in 2013 that for its first three years, rail freight revenue had increased by over 25%.[20]Similar progress in attaining new customers and increasing freight volumes has been made over the life of the Plan to date (other than with coal).
Steady and at times rapid progress has been made on the enabling parts of the Turnaround Plan, such as new locomotives and wagons, lengthening of the rail ferry and track destressing, but not always effectively.
The 10 Year Turnaround Plan was quickly undermined by a series of adverse events, including:
- Earthquakes:2010 Canterbury earthquake,2011 Christchurch earthquake,and the2016 Kaikōura earthquake,resulting in significant infrastructure damage and closure of the Christchurch to Picton line from November 2016 to 15 September 2017[21]
- Lengthy severing of the rail ferry link between the North and South Islands when theAraterelost a propeller in 2013[22][23]
- Significant and lengthy problems with the newDL class locomotives
- Pike River Mine disaster,leading to the mine's closure and the loss of revenue that had been anticipated from coal freight
- International coal price collapse
- Solid Energy,the largest NZ coal mining company, enteringvoluntary administrationin 2015. This was the culmination of a downturn that had begun to appear in 2012–13: significantly less coal being moved from West Coast mines[14]
- Major rebuilding after fire damage and seven week closure of key freight routeMidland linein 2017[24]
2017 update of the Turnaround Plan
[edit]Partially as a response to the events outlined above, in the2017 budgetthe government announced a further $450 million in capital funding for KiwiRail, and that the company's operations would be placed under another major review, believed to relate to future funding models. The $450 million was earmarked for repairs following the2016 Kaikōura earthquakeand for further locomotive and rolling stock purchases. As part of the Turnaround Plan's agenda to standardise locomotives and wagons, in 2016 KiwiRail announced it would effectively switch off the NIMT electrification in late 2017 and replace the electric locomotives with an additional eight DL locomotives (additional to the 15 as reported in the 2016 Annual Report).[25]
On 30 October 2018 that capital funding was made available to by the newLabour-led Coalition governmentto refurbish 15 of the surviving 20 EF locomotives at the Hutt Workshops extending the service life by 10 years for their continued use, in line with the Governments energy and emissions policies, and while the government is also actively considering extending the North Island electrification for the first time since the 1980s.[26]
KiwiRail has made use of the Government'sProvincial Growth Fund(PGF). In 2019 KiwiRail signed an agreement with theNew Zealand Transport Agency,Palmerston North City Councilto construct aroad, rail and air distribution centre in Palmerston North,following a $40 million allocation to KiwiRail from the PGF.[27]
New Zealand Rail Plan
[edit]In 2019, the government began a "Future of Rail" review, and in December 2019 released a draft New Zealand Rail Plan, outlining changes it proposed making to the rail transport industry and KiwiRail specifically.[28]The draft plan proposes a number of major changes, the most significant being future funding of the rail network through the National Land Transport Fund,[29]and charging rail operators to use the rail network via Track Access Charges. A number of other projects are proposed under the draft plan. They include a new train control centre in Auckland, replacing two Interislander ferries and rolling stock.[29]
On 17 March 2020 KiwiRail released a tender for the supply of new mainline locomotives.[30]2021 New Zealand budgetallocatedNZD$722.7 million to purchase new mainline locomotives, shunt locomotives and wagons.[31]In October 2021,Stadler Railannounced it had won the contract to supply 57new locomotivesfor KiwiRail.[32]Stadler Rail stated the contract was worth 228 million Euros,[32]orNZD$403 million.[33]
The2022 budgetallocated $661.5 million to KiwiRail, with $312.3 million for improving the national rail network and $349.2 million for completing the replacement of "ageing" locomotives and freight wagons, including up to 29 new light-duty locomotives. The total government investment increases to $8.6 billion.[34]
KiwiRail business units
[edit]Freight
[edit]KiwiRail Freight is the company's largest business unit, making up the majority of KiwiRail's revenue with $390 million in the financial year ended July 2016. In the same year, KiwiRail moved around 18 million tonnes of freight and carried about 16% of New Zealand's total freight task (tonnes-km).[35]Traffic grew from 2017 to 2019, dropped sharply during theCOVID-19 pandemicand largely recovered in 2022.[36]
Freight types:Timber and dairy products formed 60% of the tonnage moved in 2022.[36]Bulk commodities include coal, logs, milk (dryandwet), IMEX (import/export intermodal) and domesticintermodal freight.Formerly large scale freight types such as petroleum products have entirely been withdrawn, and fertilizer has almost disappeared. The freight trading revenue by sector, as per the December 2016 Half Year Report is:[37]
- Domestic 27%
- Bulk 19%
- Forestry 15%
- Import/Export 39%
Rail freight depots:KiwiRail has a total of 17 rail freight depots. In the North Island, these areWhangārei,Auckland,Hamilton,Tauranga, New Plymouth, Napier,Whanganui,Palmerston North,Masterton andWellington.In the South Island they are Blenheim, Christchurch, Ashburton, Timaru, Oamaru, Dunedin, and Invercargill.[38]
Inland Ports:KiwiRail serves a number of Inland Port yards, although does not own the tracks. These include Conlinxx (Wiri), Midland Port (Rolleston), Longburn International Freight Hub (Longburn, Palmerston North), Manawatu Inland Port (Palmerston North), MetroPort (Southdown in Auckland and Rolleston in Christchurch) and will include Ruakura (Hamilton) when it opens in 2019,[39]and Ports of Auckland's site at Horotiu in Hamilton.[40]
Sea Ports:KiwiRail has majorfreight yardsandsidingsat Lyttelton port Company (containers,logs,coal), Port Chalmers (containers), Southport (Bluff), Timaru, Port of Tauranga (Mt Maunganui and Sulphur Point), Ports of Auckland,CentrePort (Wellington),Port of Napier and New Plymouth. KiwiRail also has a joint venture with theNorthland Regional Councilto build a branch line (theMarsden Point Branch) to connect toNorthportat Marsden Point.[41]
Anchor freight customers:Key anchor customers include Fonterra, Westland Dairy Products (Rolleston and Hokitika), Bathurst resources and the various freight forwarders including Mainfreight and port companies including Port of Tauranga.
Freight wagons:KiwiRail operates 4,855wagons.An additional 120 wagons were acquired in the year ending 2016, with over 1,000 new wagons added since 2008. One of KiwiRail's stated aims is to progressively move towards standardized wagons, with the containerflat-topbeing overwhelmingly the dominant type (carrying curtain sidedswap bodies,liquid containers,Log cradles[42]and so on to meet almost all freight tasks). TheNorwegian couplingis progressively being replaced with semi-automaticJanney coupleron all wagons.
Key freight routes:
- Auckland – Christchurch: domestic general freight, mostly via 10 ft, 20 ft and 40 ftcontainersand curtain-siders orbox wagons.
- Auckland – Tauranga: Containerized and bulk export products
- Kinleith/Murapara – Mount Maunganui: wood products only
- Midland Line: Bulk export coal from north of Westport and Reefton, coal containers for Fonterra, dry and wetmilkbetween Westland Dairy plants at Hokitika and Rolleston, export dry milk from Fonterra at Darfield.
- Edendale – Taieri – Port Chalmers: exportmilk powderincontainers.
- Wairio – Invercargill: solelycoalin containers for Fonterra use.
- Invercargill – Bluff: run as a 'shunt', sole freight is exports to Southport.
Interislander
[edit]Re-branded along withKiwiRail Scenic Journeysas the single brandThe Great Journeys of New Zealandin 2017, The Interislander is the company's second largest business unit. It operates ferry services acrossCook Straitbetween Wellington in theNorth Islandand Picton in theSouth Island.In the financial year 2012, $123.9M of KiwiRail's revenue came from the Interislander, with the majority of the Interislander's revenue coming from rail and road freight transport.[43]
Property and Corporate
[edit]KiwiRail is a major land owner in New Zealand, and manages over 18 thousand hectares of land, has in excess of 1,500 property assets with a combined value of over $965 million (Annual Report 2016). Increasingly, KiwiRail is pursuing a commercial approach to asset management, and in the 2016 financial year received over $18 million from property sales.[35]
Great Journeys New Zealand
[edit]Re-branded along withInterislanderas the single brandThe Great Journeys of New Zealandin 2017, it is the long-distance passenger transport subsidiary of KiwiRail, operating theNorthern Explorer,TranzAlpineandCoastal Pacific.The passenger trains are predominantly patronised by tourists to NZ, with the exception of the Capital Connection, which is a commuter train.
In 2012, KiwiRail attempted to sellTranz Scenic,[44]but was unsuccessful, and KiwiRail continues to run these services. The division is now experiencing rapid double-digit annual growth, due to the growth of Chinese tourism to New Zealand, so much so that KiwiRail in 2017 may purchase an additional eight carriages[45]to the 17AK carriagespurchased in 2012.[needs update]
In 2021, following a decline in tourism during the COVID-19 pandemic, KiwiRail announced the suspension of the Coastal Pacific and Northern Explorer as part of Project Restart '22.[46][47]While it is currently, as of January 2022, unclear what direction KiwiRail intends to take, Project Restart suggests a shift to multi-day land-cruises, a form ofExperiential tourism.[46]This decision, or potential decision, has been seen by many New Zealand-based transport advocacy groups as an abandonment of interregional rail by KiwiRail. Campaign for Better Transport described it as the "latest stage in the decline of what was once an extensive passenger rail service which serviced most of New Zealand".[48]An announcement is expected by July 2022.[46]
Tranz Metro
[edit]Until 2016, KiwiRail divisionTranz Metrohad the contract to operate the Wellington services but lost a bid to renew this contract in 2015. KiwiRail is sub-contracted byTransdev Wellingtonto provide and operate the diesel locomotives required to haul theWairarapa Connectionservice.
Suburban rail passenger operations in Auckland and Wellington are contracted by their respective local governments and not operated by KiwiRail. In Auckland rolling stock is owned byAuckland Transportwhich has contracted operation toAuckland One Rail,while in Wellington rolling stock is owned byGreater Wellington Regional Councilwhich has contracted operation to Transdev Wellington.
Infrastructure and Asset Management
[edit]The KiwiRail Infrastructure and Engineering division, formerly known as ONTRACK, has three main areas of operation:
- Development, maintenance and operation of all of New Zealand's main-line rail infrastructure (seeList of New Zealand railway lines).[50]
- Provides rail operators with access to the rail network in return for the payment of track access charges.
- Rail network controller, providing services such as train control and signalling.
The network it is responsible for consists of:
- Route length: 3,898 kilometres (2,422 mi)
- Tunnels: 148[51]
- Bridges: 2,191[52]
- Electrification:95 km at 1.5 kV DC (Wellington area), 411 km at 25 kV 50 Hz AC (NIMTcentral section)
Engineering
[edit]The Engineering division provides mechanical assistance to the Freight and Passenger businesses, as well as to Auckland Transport. Engineering maintains, refurbishes and occasionally builds rolling stock for the network.
In 2012, KiwiRail announced it was putting itsHillside Engineeringdivision on the market.[53]and subsequently sold part of the division and transferred remaining work to Hutt workshops.
KiwiRail now operates theHutt Workshopsin theHutt ValleyofWellington,along with a number of small wagon maintenance depots, for example, at Addington (Christchurch) and Frankton.
Stabling yards
[edit]Most rail operations are a 'there and back' service with motive power being held in a few key strategic locations. Motive power stabling yards are as follows:
- Westfield (Auckland)
- Frankton (Hamilton)
- Palmerston North
- Thorndon (Wellington)
- Middleton (Christchurch)
- Dunedin
Yards and facilities
[edit]Some of the more prominent rail facilities used by KiwiRail include:
- Westfield, Auckland (adjacent to the closedWestfield stationand nearWestfield Junction)
- Southdown,Auckland
- Te Rapa,Fonterrabulk store yard,Hamilton
- Mount Maunganui
- Wellington
- Picton,Marlborough (solely used for marshaling wagons for rail ferry)
- Spring Creek(serves as rail head for Nelson)
- Middleton,Christchurch(largest yard in South Island)
- Dunedin
- Taieri,Fonterrabulk store facility,Mosgiel
Current rolling stock fleet
[edit]Locomotives
[edit]The table below lists only the current locomotives in service with KiwiRail.
Image | Class | Introduced | Number in class | Number in service | Power output (kW) | Notes |
---|---|---|---|---|---|---|
DC | 1978–1983 | 85 | 16 | 1230 | Mainline diesel-electric. Fifty-two scrapped, six preserved, six sold overseas, 2 sold at auction and three stored. Sixteen classed as DCP. | |
DF | 1979–1981 | 30 | 29 | 1800 | Mainline diesel-electric. Sub-classes: DFB (21) and DFT (9). Two under overhaul to DFB, and one scrapped. | |
DH | 1978-1979 | 6 | 6 | 672 | Heavy shunting locomotive. | |
DL | 2010–2023 | 83 | 73 | 2700 | Mainline diesel-electric. | |
DSC | 1959–1967 | 70 | 27 | 315 | Light shunting. Thirty-four scrapped, two preserved, three stored and three owned by industrial owners. | |
DSG | 1981-1983 | 24 | 24 | 700 | Heavy shunting. One under overhaul. | |
DSJ | 1984-1985 | 5 | 4 | 350 | Light shunting. | |
DX | 1972–1976 | 49 | 47 | 2240 | Mainline diesel-electric. One scrapped, one stored, and two under overhaul. Sub-classes: DXB (14), DXC (32), DXR (2). | |
EF | 1988–1989 | 22 | 14 | 3000 | 25 kV AC electric locomotives. Four stored, four scrapped and two under overhaul. | |
DM | 2024 (planned) | 57 | 0 | 3000 | Under order fromStadler Rail | |
TR | 1936–1978 | 90 | 17 | 138 | Light shunting, positioned in smaller yards and leased to industrial customers. Forty-four scrapped, twenty-eight preserved and one stored. |
Carriages
[edit]The majority of passenger carriages in New Zealand are now owned byAuckland Transport,Greater Wellington Regional CouncilandDunedin Railways.KiwiRail operates a small fleet of New Zealand builtAK class carriagesfor long-distance passenger trains and heavily rebuilt formerBritish Mark 2 carriagesin several configurations, the S class carriages for the Palmerston North-WellingtonCapital Connection[54]and the SR class carriages, which KiwiRail owns and leases for theTe HuiaHamilton to Auckland regional service. Twelve carriages are also being overhauled to replace the current S class carriages and will be deployed in two sets of six.
Image | Class | Number in class | In service | Passenger capacity | Notes |
---|---|---|---|---|---|
AK carriage | 17 | 2012–present | AK 63; AKC 10 | Used on the Tranz Alpine, Coastal Pacific, Northern Explorer services | |
SR class carriages | 12 | 2021–present | SR x6 seat 50, SRC x3 seat 20 and SRV x3 seat 38 | Used on Te Huia service, Capital Connection services |
Corporate governance
[edit]Executive Board[55] | |
David McLean | Chair |
Sue McCormack | Deputy Chair |
Ed Sims | Director |
Maryan Street | Director |
Rob Jager | Director |
Rachel Pinn | Director |
Bruce Wattie | Director |
Liz Ward | Director |
Sina Cotter Tait | Director |
Executive Team[1] | |
Peter Reidy | Chief Executive |
Jason Dale | Chief Financial Officer |
David Gordon | Chief Capital Planning and Asset Development Officer |
André Lovatt | Chief Infrastructure Officer |
Andrew Norton | Chief People and Communications Officer |
Vanessa Oakley | Chief General Counsel, Company Secretary and Property Officer |
Helen Rogers | Chief Strategy and Sustainability Officer |
Siva Sivapakkiam | Chief Operations Officer |
Adele Wilson | Chief Customer and Growth Officer |
See also
[edit]References
[edit]Citations
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- ^abc"Northern Explorer & Coastal Pacific Restart '22".Great Journeys of NZ.KiwiRail. Archived fromthe originalon 1 February 2022.Retrieved30 January2022.
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- ^KiwiRail 2011,p. 2.
- ^"Governance Board".KiwiRail.Archivedfrom the original on 10 February 2023.Retrieved10 February2023.
Bibliography
[edit]- KiwiRail Locomotive and Rolling Stock Register – 2011.Mosgiel, New Zealand: Triple M Productions. 2011.ISBN978-0-9582072-2-5.