Yesterday Kiwirail released their annual results and once again they lost a significant amount of money – $167 million for the year. The shortfall obviously has to come from the Government. They were also keen to point out that the main reason for the loss was the cost of maintaining the rail network which includes 4,000 kilometres of track, 1500 bridges and 150 tunnels.

As sure as night follows day the truck lobby were quick to complain about Kiwirail getting government support.

The argument put forward by KiwiRail won little sympathy from the main trucking lobby group.

Ken Shirley of the Road Transport Forum accused KiwiRail of seeking special treatment, and he said the company should stand on its own feet.

“No business can say that they can only conduct themselves if they have an input from the taxpayer,” Mr Shirley said.

“They have to look at their whole pricing methods, they have to look at their management of their assets and they have to organise their business.”

That’s quite a bit rich coming from the trucking industry which is heavily subsidised by tax and ratepayers. But just how much support do they get. Below is some information from the NZTA and Ministry of Transport on his.

The three year National Land Transport Programme identifies where funding comes from and where it is spent. It predicts that over the 2015-18 period of the current NLTF over $2.7 billion in funding for transport will come from local council rates which goes towards paying their share of non-state highway projects. These are of course the roads that most trucks need to use on their journeys to get to the doors of their customers

Then we have the National Land Transport Fund – the place where fuel excise duty (FED), road user charges (RUC) and vehicle registration fees go. As the graphic shows road user charges – of which the largest contributor will likely be trucks – are expected to contribute about $4.3 billion in funding while other road users contribute $5.5 billion. Lastly there are other sources of funding which go towards projects such as the government’s regional State Highway programme which is funding a number of projects directly from general taxes.

NLTP 2015-18 revenue and investment flows

The Ministry of Transport also have information on who pays for what and where it goes. Helpfully it also breaks RUC by heavy and light vehicles (less than 3.5 tonnes). It shows that heavy vehicles make up about 4% of the NZ vehicle fleet but pay about 26% of the taxes raised. The reason for this disparity is that heavy vehicles cause significantly more road wear.

As the charts below show taxes from Heavy RUC pay for about 23% of State Highways and 25% of local roads.

Fuel Taxes

With those numbers in mind let’s turn attention to one of the biggest projects coming down the pipe – The East-West Link. As we know a near motorway quality road is proposed along the northern side of the Mangere Inlet. Auckland Transport and the NZTA say the early indicative costs are $1 billion however I believe they’re now pushing up around $1.5 billion. The reason this project is getting so much attention is primarily due to the strong lobbying from the Truck and Business lobbies. They argue that the new almost-motorway is needed to free up truck movements making it quick and easier for them to operate.

Given the truck lobby are so adamant Kiwirail shouldn’t get any help from the government and the East-West Link is primarily being built to improve freight movements I look forward to the announcement that the trucking companies are paying the full cost of this new mega road.

Of course we know not all trucking companies share the view that Kiwirail shouldn’t get any help. Mainfreight has long been a supporter of having a stronger of rail network. Richard Prebble – the former leader of the ACT party and a person with an infamous history in the history of rail in NZ – has called for it to have more investment. That is in part from him seeing the value in it as a director of Mainfreight.

Just to be clear I’m not saying we should go and start charging truckies for all projects but surely it’s about time they dropped the “we’re not subsidised” act.

One positive to come out of all of this news about Kiwirail is it appears the government are coming around to the idea of having the NZTA manage the freight network

State-owned KiwiRail is pressing the NZ Transport Authority to take over funding the national railway network and believes it has Transport Minister Simon Bridges onside in a way not true of his predecessors, Gerry Brownlee and Steven Joyce.

In comments at KiwiRail’s annual public meeting, chairman John Spencer and chief executive Peter Reidy highlighted the inclusion of a new top priority in the NZTA 2015-2019 statement of corporate intent to “integrate road and rail to improve freight network productivity” as a sign the government is coming round to the need for an integrated approach to road and rail network investment.

This is positive to hear as it’s a position that seems to be almost unanimous across a broad spectrum.

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76 comments

  1. What’s happened to the Surface Transport Costs and Charges Study? In 2005 the STCC study for the Ministry (http://www.beehive.govt.nz/Documents/Files/STCCS%20Main%20Report.pdf) estimated that trucks directly pay 56% of their costs, cars 64%, buses 68% and rail 77%. Ever since that 2005 report, the Ministry has been doing “further research” (see http://www.transport.govt.nz/research/othertransportresearch/understandingtransportcostsandchargesuttc/).

    Whilst the Ministry dithers over researching comparative costs, it’s pouring huge sums into new road construction, beside which a $167m deficit pales into insgnificance. Not just the East-West link, but RoNS all over the country. For example, the Waikato Expressway will have cost about $2.7bn by the time it’s completed. If we’re lucky, and Auckland motorway congestion hasn’t offset the savings, a drive from Cambridge to Auckland will take 20 mins less. For rather less cost, a 350kph railway could have saved over an hour. Countries including China, Malaysia, Turkey, Morocco, most of Europe and even the USA, have woken up to the value of high speed rail. When will we?

    1. Probably not until the majority of people start to think that we can actually run a half decent rail system.

      Wellington does well, but until Auckland and potentially Christchurch (although current signs aren’t promising) can have commuter or metro rail that delivers a service that is accepted as a viable alternative to a car, the likelihood of high speed rail connecting metropolitan centres is fairly remote.

    2. The current tracks could do two hour journeys. Even without traffic it is hard to do it in a car in 90 minutes. Google maps says 2:19 right now. The WRC ignored the recommendations of a report that they commissioned to actually run a service on the existing tracks.

      1. Setting the right goals and with the proper organisation I believe there is a big opportunity for rail and especially rail freight in the Auckland – Hamilton – Tauranga triangle.

          1. Tranz Rail did actually introduce a new Hamilton commuter train about 15 years ago, and kept it going for a year or two, but patronage never got beyond about 20 people from Hamilton. It was fast too, 1hr, 56min IIRC. Cheap as well, due to having a low operating cost.

            Today, the Waikato Expressway makes driving even easier and quicker, whilst the ability to replicate that fast and cheap train has eroded dramatically. Passenger train opex under KiwiRail is about double what it was back then, and the fastest schedule possible now is about 2hr, 15min. Fares will be high, or subsidy will be huge.

            My feeling has always been that such a service, as with so many other things, is something that first requires a new network model for rail. KiwiRail cannot deliver affordable passenger services anymore, under their high cost structure, combined with high revenue expectation, and a management completely disinterested in pursuing new passenger opportunities.

            What is needed first is open access, and complete removal of KiwiRail from the equation. Councils / other operators should be able to buy track access with absolutely no involvement or say from KiwiRail, or any other operator. New ventures should be between the independent network owner and the prospective operator only, and of course the independent network owner would welcome new entrants, as it would increase revenue and make the network more vibrant and more secure.

            But it’s important to remember that fast trial train attracted very few people. Talk of a new service carrying thousands of people is pie in the sky stuff. I reckon there would be a market of a few hundred people, able to support peak and midday services, but nowhere near enough demand for regular all-day trains. That’ll be a few decades down the track.

      2. Why would a regional council invest in exporting residents to the adjacent competing metropolis?

        “Why yes, sign us up for paying to diminish our economic base down to being a dormitory town”.

        Services like AKL-HAM rail are a national issue, not a local one.

        1. Why would a regional council serve the interests of it’s residents?

          Who said that there would not also be commuting in the reverse direction?

        2. Also, 153,000 people live in the tron; in order to be a dormitory town would have to provide 225 EMU services a day, all full just to move the realistic working population.

        3. Palmerston North residents part-fund the Capital Connection to Wellington, because it encourages Wellington workers to live and pay rates in Palmerston North. I don’t see why the same couldn’t be true of Hamilton (and Huntly etc).

  2. It is so fundamentally clear that the current ownership and operating structure is untenable. It is pure anti-rail ideology that has prevented the government from fixing this.

    1. Don’t you mean pro-rail ideology? The rail network runs at a perpetual loss – people arent willing to pay what is required to provide the service. That is pretty fundamental.

      1. Matthew

        Toll would lose money as well, if it owned the roads, and had to report all repairs as expenses on the income statement. The trucking industry don’t have to do this, as it appears on AT’s & NZTA income statement.

        If you removed the cost of maintaining the huge rail network from Kiwi Rail’s books to the NZTA it would produce the same result.

        Also the Rails value is in understanding the opportunity cost. If we closed the whole rail network down it wouldn’t just mean we save x. It also would mean that NZTA would face higher maintenance costs for roads due to 1000s of extra heavy trucks, as well as the new motorways that would need to be built to make it work

        Also the traffic would be chaos if we had no rail plus POA was still open as all those 1000s of trucks would pass straight through the city. We have to look at the opportunity costs.

        1. Rates are fed into the system on the basis that land owners should contribute to the upkeep of access to their properties. In any case in a road pricing world where there were no subsidies, road freight would do very well. Rail freight would certainly not survive in its current form. Probably the major Tauranga Auckland route would prosper but not sure about metro rail or any other lines.

          1. If driving were priced as you intend then rail would be very profitable indeed as many people would change Whangarei to Tauranga, and Kinleith plus the Wellington and Auckland tracks run at a profit to Kiwirail.

  3. Metro rail is the big opportunity for Auckland.
    Efficient Metro rail as proposed in this blog as a component of the Congestion Free Network will result in a reduction of single occupancy cars on the city roads and motorways thus benefiting the trucking industry and trades people.
    We must move from investing solely on roads, to a balanced transport mode programme. Over the next 5 to 10 years public transport investment is to be preferred if only to make up for single mode expenditure (i.e. roads) over the last 65 years.

  4. To be perfectly honest I dont see how you have demonstrated that trucks are subsidised. The pay for roads and they use roads – what the balance is is not clear. The only way to tell would be if we had rational road pricing. Its not the truckies fault we dont have this.

    Trucks have to endure congestion due to the lack of rational road pricing in NZ. Trucks, making relatively high value vehicle trips, would benefit greatly from road pricing. In a road pricing world they would a) be better off and b) demonstrably pay their own way. So I am not sure how it is reasonable to label them as beneficiaries of a subsidy.

    Most big road projects at the moment are about increasing capacity. This is primarily driven by light vehicle usage – at the margin low value trips that wouldnt necessarily exist in a rational road pricing world.

        1. Oh you are talking about a subsidy to all road users.

          The rates contribution is at least partially justified on the basis that it is about providing / maintaining _access_ to properties (i.e. to ratepayers properties).

          But anyway we are agreed that in a road pricing world trucking would be better off. The main roading subsidies are internal – from high value users to low value users and from off peak users to peak users.

          1. Trucks over 40 tonnes are responsible for 90% of road wear and a disproportionate percentage of road trauma in relation to the number of trucks on the road. For trucking companies to be effectively compared to rail they should be providing their own road network in a similar way to how KiwiRail provide their own rail network.

            As a road user I much prefer the rail network as trains don’t threaten my life on a daily basis like trucks do. Trucks over 40 tonnes are essentially as maneuverable as trains on the road and a significant risk to every other vehicle particularly vulnerable traffic.

          2. “For trucking companies to be effectively compared to rail they should be providing their own road network in a similar way to how KiwiRail provide their own rail netwirk.”

            That sounds like an absurdly ridiculous waste of money. No let’s compare the two actual situation instead of some bizarre alternative reality.

          3. That’s the whole pooint though right? We cannot compare the two in the existing scenario, but both the road network and rail are subsidised so the trucking lobby don’t have a leg to stand on complaining about rail subsidies.

            It would be interesting to see what true pricing would do…. Guarantee we wouldn’t build suburban streets with carparks!

    1. Matthew its less about use, and more about damage.

      Motorbikes & Scooters do basically no damage to the roads.
      Private Cars do very little damage to the roads, however usually need lots of big roads built.
      Light Trucks do some damage to the road.
      Heavy Trucks rip off the roads especially local ones due to our roads not being able to handle the axle loads.

      I’m not sure of the maths, but its something between 15-30 times the damage a heavy truck does to a road over a car.

      1. It is actually mainly about usage, but yes also about vehicle weight. Vehicle weight increases the cost of building roads by increasing the loads bridges have to be designed for and by increasing the pavement design requirements. For a new greenfields road the extra cost of catering for trucks would be less than 5% of the capital cost. The cost of pavement maintenance will be driven a lot more by trucks but this is only one part of road maintenance. In urban areas, it really is all about usage. The main cost is that of the real-estate with additional capacity requiring expensive infrastructure (e.g. great big tunnels). We don’t want for additional road capacity in Auckland because of the cost of Winstones AP40! So yes trucks should pay more than cars. In my opininion the current funding is skewed in cars favour rather than the other way around given the types of projects now being funded.

        1. Matthew, I think your potentially under-estimating marginal costs associated with designing roads to accommodate large trucks. Everything from the widths of lanes, to road foundations, to the strength of bridges is designed largely in response to the largest/heaviest vehicle using the infrastructure.

          We could get away with much cheaper roads if we were not designing for trucks. I’m not sure the road user charges reflect these marginal impacts very well. They tend to focus on marginal impacts in terms of road maintenance, but not marginal impacts on road construction costs. I think the latter are significant, hence why many studies find that heavy vehicles are relatively highly subsidised compared to other modes.

      2. You’re missing a zero. More like 150-300x the damage as the damage increases exponentially with weight (unless it is massively spread out and even then still more than a car).

    2. Matthew all transport is subsidised. How much and by whom is the only issue. Yes trucking contributes to the road system but clearly not sufficiently to cover the burden they place on it. Rail freight and passenger services also contribute to the operation and maintenance of the rail network, but not entirely. The calculation of negative and positive externalities further complicate the issue. Ken Shirley is just singing from his usual and absurd songsheet when he claims his members operate a saintly and pure user pays model. They do pay; just nowhere near enough to claim the moral high ground.

      1. “Matthew all transport is subsidised. How much and by whom is the only issue.”

        OK even if all transport wasnt subsidised, how much and by whom would be the main issue, agreed. ($1 of subsidy is not much different for $0, 0 is just one end of the scale). Not sure what you point is though.

        “Yes trucking contributes to the road system but clearly not sufficiently to cover the burden they place on it.”

        You say clearly, I but I don’t see it. That was one of the points of my comment. Has this been clearly demonstrated? Certainly not based on the post above is my opinion.

    3. Even Richard Prebble agrees that rail needs to be treated the same as roads.
      I think I need to go have a lie down now that I agree with Prebble on something!

    4. “To be perfectly honest I dont see how you have demonstrated that trucks are subsidised.”

      Consider the marginal cost to a local authority of an increase in heavy vehicle traffic on local roads. Only 56% of that increase in cost is met by charges imposed by the operators of those vehicles. The balance has to be obtained from ratepayers. Looks to me like a hefty subsidy to the profit-seeking trucking companies from captive ratepayers. To argue that this balance is, ipso facto, an access charge is bordering on the delusional.

      When the euphemistically-named “high productivity motor vehicle” legislation was introduced a few years ago Steven Joyce was asked about the extra costs imposed on local authorities (and hence ratepayers) he responded that the ratepayers would be the beneficiaries of this increased productivity. I can imagine the smirk on his face as he said it.

      Not too far from where I live there is an industry that, until a few years ago transported a bulk commodity by rail all the way. These days a substantial proportion of that commodity travels by 9 axle H-plated trucks with around 56 km of each round trip on local roads. My rates and yours are going towards funding this “increase in productivity”. In the meantime the roadworks season has started and those roads are being resurfaced (with chipseal) to repair the truck-induced damage. I have never lived in a country or area of NZ where windscreen replacement has been such a common requirement.

      So…trucking companies paying their way? Far from it.

      1. If you applied this logic, every road project would be a subsidy to the direct beneficiaries. Any particular spend will have a limited number of beneficiaries whereas the project would have been funded by everyone. Are those that use the VPT subsidised by everyone else? Perhaps but then they are part of the subsidisers from myriad other projects and maintenance. So I don’t think this is an effective way to answer the question. I still think comparing the current situation to a rational road pricing world is the best option for answering it,

        I don’t know what an appropriate contribution from ratepayers is for an access charge, but I do know that a heck of a lot of the value of a property is contingent on its access to the road network.

        1. And those residents are perfectly capable of paying each time that they drive sown that section of road. That is what full road pricing would look like.

        2. Matthew: I have illustrated that an increase in truck traffic on local roads results in an increased charge to ratepayers by way of increased costs incurred by such traffic. The ratepayers get no additional “access” benefit as a result of this increased charge. It’s that simple.

    5. “The only way to tell would be if we had rational road pricing. Its not the truckies fault we dont have this.”

      Oh really? Not their fault. I can assure you that they lobby long and hard to ensure that the current model stays put exactly how they like it.
      They are after all doing special pleading right now to have the 1.5B East/West motorway ,oops, I mean “Limited Access Arterial”, built, for their requirement, and only their requirements.

      To blame the Government for being the only cause of this “funding imbalance”, is, as in your words above, “rather simplistic”.

      Mind you that’s all a bit like the rest of your specious straw-manning about the trucking lobby subsidisation issue – Each. And. Every. Time. It. Comes. Up – Without. Fail.

      1. The reason I brought up rational road pricing is this: The current system has everyone pay into a pot, it is stirred up with rates and redistributed over many areas. So it is very difficult to tell if trucking as a subset of that is subsidised. So a reasonable question to ask is – in a rational road pricing world where everyone is transparently unsubsidised, would truckers be better or worse off? My contention is they would likely be better off as road pricing, with its congestion reducing benefits and efficiency gains, will favour relatively high value road users of which trucks are a prime example. Hence there is a case to be made that truckers are unsubsidised currently, and indeed they would be much better off if all road users were unsubsidised and road use was properly priced (let alone being better off if rail was unsubsidised).

        I am not sure what straw man you are referring to. The post, as I interpret it, concludes that trucks are clearly subsidised. That is the “man” I am “attacking” and he is there in the post, I didn’t make him out of hay.

  5. Agree that the NZTA should own the rail & the “state highway” roads. My solution for freight/transport would be this

    1. Abolish NZTA & replace it completely with a new organisation with new people. It would be called Kiwi Transport and would be multi-modal including motor vehicles of all types, cycles, walking & PT. It would be independent and could do the projects with the best cases with less car bias.
    2. Investigate how much it would cost to dual gauge (Standard or Broad) the tracks from South Auckland to Tauranga alongside upgrading the loading gauge to allow double stacking, longer & faster trains. This would entail making Tauranga the super port & possibly developing Port of Auckland into a Canary Wharf location or reducing it for transshipping. I think this option would be impossible for Marsden cost wise hence why Tauranga. If electrified would also allow Higher Speed (Not High Speed) Between BOP – Waikato – Auckland
    3. If the above isn’t feasible then the Super Port should be at Marsden which Northland rail upgraded as well as NIMT, Northern SIMT & East Coast Main Trunk be upgraded for higher axel loads etc. as recommended by this Productivity Commission paper http://www.productivity.govt.nz/sites/default/files/Sub%20002%20-%20Target%20Railway%20Progress%20-%20The%20Role%20of%20Rail%20in%20NZ%20Transport%20Strategy%20v7.pdf

    1. 4. Increase the amount of slidings to industry (e.g. Logging)
      5. Increase RUC on Heavy Trucks, do the same for light however not anywhere near as much.
      6. Introduce Trucks Lanes on busy roads with many lanes such as SH1 (South of Westfield only & North of SH 1 connection with Western Ring) & the Western Ring, Plus same roads as 7. East West Link, plus maybe some to East Tamaki way. (Could Also be used by Buses) instead of building fancy new motorways. So let no one say I am anti-truck, just for smart trucking projects that actually would make a difference & are super cheap.
      7. Introduce Congestion Charges & Encourage Night/Early delivery.

      I have a Plan for Auckland Transport as well but i’m just an armchair rail Princess no expert.

  6. In the desire to paint trucking companies as evil, some intelligent analysis has been missed. The trucking industry AS A WHOLE supports rail, as without rail their freight costs would rise, congestion etc. What was said (and rightly so if the message were listened to) was that freight rail is currently run poorly. How you went from that to trucks don’t pay their way is a total mystery. You can make stats say anything you want, and only those with a few clues will take a deeper look. Nice if you want to politicize something but pointless if you missed what Ken was saying. DESPITE subsidies rail is doing poorly. And he is correct. Simple as that. No need to bring out the car / truck haters.

    1. Rail isn’t doing poorly though, it makes a profit. Rail is struggling because it’s had no real investment since pre 1970s while 10s of billions have been spent for capital upgrades for trucking infa. Meanwhile Kiwi-Rail just gets enough to survive.

      Give Kiwi Rail 5B for Capital upgrades and we will see rail take easily the Auckland-Hamilton-BOP plus CC-Wellington-Auckland and Northland-Auckland if Marsden is built corridors and watch the heavy trucks reduce on our congested roads.

      BTW my budget is Avondale-Southdown, Third Auckland Main, loading gauge and axle load upgrades, modern trains and loading stock for the above corridors plus re-opening Gisborne Line and your everyday nom description jobs.

    2. You missed the bit where, operationally, KiwiRail made a profit. Their losses all stem from network maintenance and necessary upgrades.

  7. Without rail there would be a huge increase in road maintenance costs. Here in Western Victoria (Australia) we have had about 5 years of timber harvests from plantations, all of which is trucked to port (Portland and Geelong). We now have a $200 m backlog of deferred road maintenance. The heavy trucks compress the road surface into gentle ruts, which accumulate water after rainfall. Water seeps into the road foundation through small cracks, weakens the foundation and leads to pot holes. These are patched during winter, but eventually the whole road needs to be rebuilt. Road damage is proportional to the fifth power of the mass, whereas road taxes are proportional to the first power of the mass. So from a road maintenance perspective, large trucks receive a large cross-subsidy from small trucks and cars.

    A similar scenario needs to be painted for New Zealand, of which highways would need to be rebuilt and at what frequency if the rail network were closed. Many of the highways and road bridges would have been built in the era when there were distance limits on trucks so they were not allowed to compete with the railways. All these would need to be rebuilt to a much higher engineering standard, and how much would that cost ?

    1. If what you are saying is happening, then the roads are being allowed to fail. Once cracking of the wearing course starts and the subgrade becomes saturated, pavement failure will quickly follow. If pavements are properly maintained in a timely manner you wont need to rebuild the road.

      1. Does your opinion change if you look at the research on the fourth power?

        For example, http://ec.europa.eu/transport/modes/road/events/doc/2009_06_24/2009_gigaliners_workshop_jrc_2.pdf says “Most often, the concept of an Equivalent Single-Axle Load (ESAL) is used by engineers to assess the effects of heavy vehicles on pavements. In the 1960s, The American Association of State Highway Officials (AASHO) undertook research to evaluate ESAL values for different axle configurations (single, tandem, tridem), at different weights and on different types of pavements. It resulted that ESAL values varied approximately as the fourth power of static axle load. In other words, the effect of a 11.6t single axle compared to a reference 10t would be roughly (11.6/10)4 =1.81 i.e. around 80% greater.”

        Most cars have axle weights around ½t. Compared to the 11.6t quoted above the truck would do 93 times as much damage as a car. Trucks form around 10% of traffic, so are doing roughly 9 times as much damage as cars.

        But it’s government policy to increase truck weights, so the 2005 research on comparative costs is still stalled. The government doesn’t want to know. Google ‘National Party donations road lobby’ and you’ll soon understand why.

      2. Matthew, you clearly don’t know anything about resource allocation in the public sector. The region’s road maintenance budget would be based on what it was historically, less an “efficiency dividend”, plus some short-term initiatives that are a result of political lobbying. Such a formula doesn’t take account of changes in the nature of the traffic, from a few smaller trucks to a continual succession of large B-doubles. Furthermore, all fuel taxes go the Federal government, who return a portion of it to a few designated national roads, and some to local roads, but none to State Highways. So the highway managers have little option but to allow them to fail, then when the road surface is mostly patches and temporary speed limits are in place, there is more chance of special-purpose State funding to rebuild the road. (This happened on a State highway near here while it was part of a trial of high productivity vehicles.)

        Cracks form because of trucks driving on the road during heatwaves when the bitumen is soft. The tar sticks to the wheels rather than the road, leaving a gap through which water moves during the following winter.

        Matthew, your excellent link says little about sheer stress of high productivity trucks turning. A lot of road damage occurs when these trucks turn when the bitumen is hot and soft, and the tar is stripped from the road onto the wheels. To reduce maintenance these high-sheer sections should be concrete. The sheer stress from cars is not the problem – it’s the trucks.

        1. On the contrary I am not laying the blame with anyone person, if funding can’t be redirected/increaed then that is where the problem lies. I was merely pointing out that when it comes to the type of pavement failure you have described an ounce of maintenance is worth a pound of road reconstruction.

          if the roads were grossly inadequately designed for such traffic in the first place then failure may have been inevitable. Not sure how this relates to the NZ road vs rail issue where trucks replacing rail would occur on well built state highways.

          1. Doesn’t matter if it’s a gravel road, tar seal, or 100% solid concrete…trucks are still going to damage and produce more wear and tear than other vehicles.
            Quite simply any containerised freight (and things like new car shipping, logs etc) going long distance should be on a train not a truck.

  8. Some errors in this article:
    1. the proportion that local boy rates pay fro local roads varies depending on the Funding Assistance Rate of that area – here in Nelson the FAR is 43% so ratepayers pay 57% of costs of local roads (same in Auckland and Tauranga). Its only the smaller more isolated and sparsely populated areas that get more than 50% of local road funding from the National Land Transport fund. (However this whole FAR system was being renewed, so maybe you have later figures, however I doubt that the main centre ratepayers are paying less than 50% of their local roads)
    2. Trucks don’t cause just the majority of wear and tear on the roads, they cause almost all of it, even if their numbers are less than 10% of the vehicle fleet.
    3. Even if trucks are less than 10% of the vehicle fleet what about the km driven – that is the important thing. A lot of cars are driven very few km/year, whereas I’m sure many if not most trucks would be driving 100,000 km/year

  9. Does anyone know if the Australasian Railway association, which kiwirail is a member lobby the Government on behalf of rail in NZ?

  10. Road freight is effectively massively subsidised
    The “cost” (as in cost of the roads) of road freight is approximately the forth power of axle weight multiplied by the milage
    So if a truck has three axles and a total weight of 39 tonnes and a normal car has two axles and a total weight of 2 tonnes (heavy passengers)
    Car = 2
    Truck = 3 x 13 x 13 x13 x 13 = 85,683
    So for the same milage a truck should be paying 42,841 times as much as a car

    A truck pays about $400 per 1000Km – or for 10,000Km (normal car milage) about $4,000
    A car pays $50 / year
    If a car “costs” $50 then a truck should cost not $400/1000km but $214,000/1000Km

    If the freight guys were actually paying for the wear on the roads then the rail would look very cheap!

    As it is we – the motorists – are massively subsidising the road freight business
    I would much rather that either road freight paid for the roads they use or that we gave the same level of subsidy to the railways
    In either case the railways would be shifting a LOT more freight

  11. Those numbers are bad enough, but I would argue that the hidden subsidies make truck transport even worse. Congestion & health effects, and the sheer liveable-neighbourhood wrecking effect of HGVs thundering down suburban streets are all passed onto the rest of society by the trucking industry.

    1. Yes, if we had a functioning ETS then rail freight would have an even bigger advantage. Especailly if it was electrified. Instead under this crazy government, Kiwirail are seriously considering reverting to diesels.

  12. Until denialists provide evidence that trucking companies have paid for most of the NZ roading network, I’ll defer to the trasnport policy experts here, thanks.

    I have been told previously by transport software engineers that one standard large truck does the same amount of pavement damage as 8000 cars. It’s why they record the proportion of such trucks to smaller vehicles on each roading segment to determine likely maintenance demand.

  13. I think there are two problems ‘leg roping’ sustainable rail freight transport in New Zealand.

    Firstly the polical problem. The first thing a politician learns to do is count. Many hard working truckies vote National. Why would they want effective competition from rail?

    Secondly the economic problem. KiwiRail must obey its political masters as an SOE. This has lead them to invest heavily in old technology Chinese rolling stock that will ‘hamstring’ rail freight for decades to come. Our trains are too small and too slow to be productive (except the point to point Wiri to Mt Maunganui service – which also could be improved) when compared to trucks. If the trains were more productive then the freight rates would fall – as they are doing in just every other country with a rail network and shift freight from road to rail.

    Presently there is neither the political will nor management nous to have a productive rail freight system in New Zealand. KiwiRail is a political football used to develop trade with off shore corporations with little regard to Kiwi society. The thing Kiwi about KiwiRail is its name.

  14. I think it’s time to consider the reintroduction of the distance limit for things on trucks. Modern software, tracking technology, sophisticated warehousing and cross docking overcome all the unproductive inefficiencies of inter-modal transfers that made us all glad to see the end of that old rule.
    Imagine a future with efficient green rail technology doing the heavy lifting between centres of population and fleets of smaller, less damaging fleets of local (electric) trucks at source and destination doing the first and last mile. The capital would shift from big rigs to better trains. The road damage issue gets dealt to and employment in the industry changes from guys(& girls) doing over-night line haul to local jobs.
    If we could find the political will we could easily find the ingenuity to make it happen in some of our great transport coys like Mainfreight.

    1. do you not think it’d be better to simply increase the price charged to heavy vehicles such that they covered their true costs, and then let the market make decisions over which mode to use for different journeys/distances? I don’t see much to gain from placing arbitrary restrictions on truck movements, compared to accurately pricing both modes.

      1. As well as separating the operational side of KR (at least for accounting purposes) from the track side of things and funding it properly. Or hand the track etc to NZTA.

      2. Be careful what you wish for. Trucks haul freight – and no doubt that covers items we all use. Who will be first to moan if transport charges on those items increases? They won’t do it for love. Trucking margins are thin already. Costs will be passed on.

      3. The market has proven itself to be spectacularly inefficient at the macro level. From climate change to depletion of resources. Please don’t recommend the market do anything important. It will produce a partial result that may suit the needs of some at a price many or most can’t afford, or it produces cheap dross that leaves people with no real alternative from a dozen different vendors who all raced to the bottom.

        That might work for hamburgers, but it’s not good at all for infrastructure and services we all need and need at a standard that must be met.

  15. Stu, I couldn’t agree with you more that true cost recovery would be a neat & tidy solution. I just don’t think it’s implementable. I love complexity and ambiguity and can build spreadsheets from hell to support any argument, but when it comes to actually doing something I like simple rules; that ordinary folks can understand with a clear link between the desired outcome and the means to achieve it.
    When frequently moving heavy loads by truck requires us to build and maintain roads at many times the cost of doing the same thing by rail it make sense to me that we transfer the loads from trucks to trains. Let’s implement a few simple rules to achieve that rather than build complex cost recovery models that will always be in dispute and not of themselves prevent road damage nor effect speedy repair.

  16. Disturbing to see that Ken Shirley is still out there wreaking social and economic havoc. He left Labour to go to ACT. In many ways he epitomises for me the insanity of the neo-liberal approach to almost everything and anything.

  17. Thank you Warren S for reminding us of the congestion free network. we need that.
    KP re the trucks over 40 tonnes, I thought that was already fact and why the Newmarket Viaduct was replaced. It also begs the question as to where those vehicles are allowed to go, as I understood that their routes would be limited yet it seems to me they go where they like.
    Harriet in this new Transport entity would it be that they would also deal with Ferries and Coastal shipping and maybe even port management as I think that there may be some benefits there as well.
    Malcolm you figures on damage powers/tonne/axle are interesting and the shear effect of close spaced axles are frightening with the recent changes in NZ and the damage to our local streets.

  18. Improve the rail network with govt. subsidies and add coastal shipping to take the load off our very poor road network under siege from the heavy freight transport trucking industry. Its time the ministers involved thought of the future of our country in the 21st century rather than their future in politics, if they make the right decisions based on the right information their future is watertight anyway. Please keep the unprofessional “know it all” bureaucrats away from important decision making.

  19. Containers were supposed to be a benefit for the movement intercity of goods with the stuffing and emptying of containers as a means of making good use of labour displaced by the labour saving technology. What happened to the readily moved container being moved from truck bed to rail bed for the long haul and then back to truck bed for the other end. The use of trucks/tractor units inter city or island to island seems very wasteful.

  20. A street that I travel on most days was patched and resealed a year ago in March. There is one business that uses containers, these containers are delivered and picked up at the rate of 2 to 3 per week. The area adjacent to the entryway has been stripped of chip by the scuffing of the close spaced axles to the extent that it is almost chip free. I guess that if we have another hot summer the binder will go as well so that base course is exposed. What can we do about this sort of problem?

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