There was a worrying article in yesterday’s NZ Herald about the future of the North Auckland Railway Line:
The Whangarei/Auckland railway line could be mothballed for an indefinite period from next year, after talks KiwiRail plans to have with the region’s businesses and local authorities.
KiwiRail CEO Jim Quinn delivered the facts about the route to yesterday’s monthly meeting of the Northland Regional Council.
A final decision on mothballing the route or keeping it open is up to a year away.
He told councillors the cost of running the trains on the route was almost exactly the same as the service was earning ($8 million to $9 million) and that the route was “a barely used asset in terms of the amount of investment”.
So it’s not even losing money. It’s actually breaking even – not bad compared to other parts of the rail network I would suggest.
“We are working through these issues with the four ‘most stressed’ routes in the country. Northland is one of the four,” he said.
The Auckland/Northland line presented the most complex issues although the Dargaville line was “less robust”. There were 13 tunnels between Auckland and Whangarei and six needed work space for larger containers.
“These containers just won’t fit through the holes in the hills,” Mr Quinn said.
There were two return week-day freight services and occasional passenger charter services between Auckland and Whangarei; and local services within Northland for forestry and dairy customers.
He confirmed the obvious – mothballing the route meant the Marsden Pt rail link was out of contention as well.
KiwiRail was at “the bread and water stage and we can’t even think about jam and cream yet.”
Some of the other potential rail line closures around the country are unfortunate, but somewhat understandable as the amount of traffic they carry is tiny. But the North Auckland Line isn’t like that – it’s breaking even money-wise, it has regular traffic it just needs its tunnels upgraded so that it can be brought up to modern standards.
I really do get suspicious whether closing this line is another tool being used to promote the Puhoi-Wellsford “holiday highway”. If the railway line is closed then the argument for Puhoi-Wellsford as the “only real freight link” will be strengthened. But I reckon that’s a dumb reason to close a railway line.
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Yah. I couldn’t believe that it’s not losing money! That makes the case for keeping it open so much stronger.
Two return trains a day and it breaks even. Surely closing this line would be foolish in this case, it would only take one new major customer and a third train a day to turn a nice little profit.
straighten the line, reduce the travel times, electrify it, expend it to Marsden Point
If even a fraction of the money they wanted to spend on the Holiday Highway was spent on this railway line the returns would be huge, I’d love so see a study comparing the return on spending money on this line relative to the vast sums that seem to be spent on roads without any debate. It will be a real disgrace if Joyce and National allow this line to be closed, really really poor foresight and a very clear demonstration of how clueless they are at how to prepare NZ for the future.
the dead hand of SJ is all over this….. here’s a source of extra traffic to try to justify that unneeded duplicate road…. Clearly any responsible government would be fighting to maintain this asset and the security and diversity of supply that it offers. AND IT BREAKS EVEN, which is extraordinary given the history of insult and abandonment it has suffered, especially under private ownership.
This is a manufactured crisis, which is starting to look like this govt’s MO. Is every little office holder in Northland a truck driver? That they can’t see the advantages in keeping this line is crazy and sad.
If Joyce and National-ACT are trying to close Northland rail line to bolster their case for the holiday highway, then Jim Quinn should be exposing this and speaking out – such an allegation is overt corruption, which all public servants should expose (anonymously to the Serious Fraud Office if he wants to protect himself).
The more likely – and less flattering – explanation, is that Jim Quinn and the Kiwirail Board are just engaging in the nasty behaviour we have seen in PT from companies like Infratil. Bullying the local councils to cough up ratepayers cash to subsidise capex for operations that are already breaking even (Infratil of course are more opaque about whether their bus routes are profitable, which is why the PTMA was passed into law).
As I have said before, Jim Quinn and the Kiwirail Board has a few questions to answer about these apparent tactics. Recall the ‘NIMT will close’ farce a few years back? No more Overlander Akld-Wgtn services? Taranaki and Gisborne lines, and now Northland (despite forests ready for harvest and railing to ports, etc).
Hmmmmm, not a good look Kiwirail. If you don’t want us to think conspiracy, don’t start line closure rumours/myths….
would be very short sighted to close a line that is breaking even, or close to it.
Absolutely no strategic thinking from the govt here, Marsden Point could end up being a major port in the future and without rail would have to build a motorway most of the way to Whangarei, another 55km from Wellsford which would cost another $5 billion or so.
What we have seen with the Rotorua line (closed 2002) is that without maintenance lines deteriorate rapidly in NZ’s terrain, and the cost of reopening the line in ten years would probably cost more than the amount of money lost in that decade.
It’s ironic that the message was delivered at a meeting of the Northland Regional Council. I’ve just been raeding their “30 year Transport Strategy for Northland” published last year and among the 8 objectives they mention are :
A well-developed and maintained transport network
Bulk freight moved from road-based to rail and coastal shipping
Improved transport choices and accessability to key services
In order to achieve this, they claim that key initiatives include:
Long term goal of 4 laning SH1 to the Bay of Islands
Development of an international airport in the Bay of Islands
Developing a strategic route to direct freight away from SH1
Linking Northport to the national rail network
Bang goes the 30 year transport strategy eh? Wouldn’t it be great if all the agencies concerned worked together to achieve their goals. Wouldn’t it also be great if the politicians (local and national) in Northland realised that Steven Joyce’s policy of pushing through the “Holiday Highway” at any cost as a monument to his term as Minister, can only work to the detriment of the people of Northland.
other aims and objectives they mention –
In a way Kiwirail is actually being quite smart, they have realised that they don’t actually need to spend money on hiring sales staff as all they need to do is threaten to close the line and the locals will go and do all the work for them finding customers and potentially even provide subsidies to keep the line open.
On another forum a commenter who obviously knows much more than I do made the following comment which indicates that there is definitely enough suitable freight for the line if we can just get that Marsden link built:
“Key to the survival of Northland’s branch lines is to get Marsden Point built. A good indicator of what would be carried is to look back to 2003 when the logs and chips still went to the old Whangarei Port instead of Marsden Point. 18 trains a week from Otiria (logs), 10 a week from Dargaville (logs), 10 a week from Wellsford/Helensville (logs) and 25 a week from Portland (woodchips). Most of that was lost to road when they switched to Marsden Point.
So build that line and you make Otiria and Dargaville busy again, and have 62 trains a week to Marsden Point with forestry traffic alone.
Any Auckland tonnage to/from Marsden Point would just be a bonus.”
He didn’t say it breaks even, he said the cost of running trains on the route is nearly as high as the revenue. That is a marginal cost, the fixed costs of the line are far greater. You would need to ask more specifically for a breakdown of costs to understand this more clearly.
On a marginal cost basis it may break even, but on a fully allocated cost (fixed and marginal) basis it wont, and that is the concern. Project the long run capital costs and that amount of money wont be enough to replace track, or sustain the line.
This part of the network has been marginal for 30 years. The NZRC received the “social services payments” subsidies under the Muldoon administration to keep the line north of Whangarei and the Dargaville branches opened, because both didn’t recover enough revenue to pay for the infrastructure.
The problems with the line are more fundamental than the tunnels, although the tunnel problem has existed for decades and it is highly questionable whether the potential revenue would offset the cost of that. The Marsden Point rail link similarly so, for if it would attract new business then Northport would cough up a fair part of the money for it (like it did for the highway improvements).
The line is substantially longer than SH1, travel times are slow (40-50km/h) and the bulk freight movements in Northland are oriented towards traffic to and from Marsden Point. Even if the branch line was built, the distances are too short for most of the freight to be economic. Most of the Auckland-Northland freight is the flow of consumer goods to Northland, which is not well suited for the trains.
The line is simply too tortuous, circuitous, steep and in the wrong place because it was built in the late 19th century and has had virtually no realignment of any kind in that time. Some may be tempted to blame privatisation for running down rail assets, but this one never kept pace with roads because a statutory monopoly on long distance freight meant it didn’t have to. Add to that no connection to the far north (Kaitaia) and the relatively short distance from Marsden Point to the forestry catchment areas, and you have little real chance for this to work.
If you think closing the NAuckland railway will improve the BCR of the Puhoi-Wellsford motorway you’re dreaming, it would hardly be noticed. The impact at worst would be one HGV more every half hour, and the RUC revenue would more than make up for the marginal infrastructure costs. This sort of conspiracy theorist nonsense should be left to the Greens, where evading economic reality has long been a pastime (I sat in meetings between a Minister and Green Party representatives who insisted “economic efficiency” should not be in the Land Transport Management Act, because it represented “Rogernomics/neo-liberalism”). I recall Sue Bradford advocating a passenger rail service on this route to Whangarei, when the last time that ran in any form was 1975, with an unheated wooden carriage from the 1920s on a slow “goods train with carriage attached” service, as the express service ended in 1968.
I would love this part of the network to be viable, it has a lot of character, and it would delightful if the Donnelly’s Crossing branch could be reopened, and the Otiria-Okaihau section (where the corridor remains in state ownership), but it looks seriously grim.
The question you need to ask yourself when considering pouring money down the financial blackhole of this line, is why other people should pay to subsidise the freight movement of businesses that use this railway? Why are those businesses special? I think unless a robust probable case of additional revenue can be made, based on upgrades, that it probably should simply be run into the ground while it generates a modest marginal return as long as that return can more than cover spot maintenance. Once something big is required it will need to be beneath around $20 million to be worth it.
“If you think closing the NAuckland railway will improve the BCR of the Puhoi-Wellsford motorway you’re dreaming, it would hardly be noticed.”
While that may be true, since when was the BCR relevant to the Puhoi-Wellsford motorway? Joyce would push forward with that project even if its BCR was 0.1. My point is that he’ll say “this is the only freight route north now” and use that as justification for his pet project.
what you seem to have forgotten liberty is that the roads in Northland are ‘tortuous, circuitous, steep’; and are most unsuitable for mixing high volumes of logging trucks with lots of tourists/holidaymakers, and anyone really.
I seriously doubt the Northland road network is economic, I think you have alluded to this in previous posts.
Why shouldnt rail be treated the same?
Well, there was analysis undertaken about the financial viability of the regions and networks of roads under the LTPS in the mid 1990s. Northland’s local roads were not financially viable, which is hardly surprising, but that’s not the issue here. The State Highway network generates a surplus over and above what it pays to operate it, so the routes that compete with the railways are themselves viable.
However, even if it were not the case, the argument would be why maintain a bespoke piece of infrastructure that costs a fortune to renew? Unless there are quantificable sizeable economic benefits, it would be questionable, and SH1 is still shorter and faster than the NAL.
Roads are essential for basic access, rates are a form of access charge to maintain local roads, so in that sense property owners in districts pay for the access component. Road users simply don’t pay enough for that share, but that wouldn’t affect rail. Still, I would love RUC to be fully electronic and have regional variations to reflect these differences, because then we would all really have a fully transparent level playing field between road and rail for freight.
Agree with Liberty Scott.
You can thank your 19thC forebears who didn’t feel Northland that valuable as to give it a decent railway alignment (such as their UK compatriots were doing at the time).
And you can certainly thank your early 20thC forebears who, on seeing the competition in the form of the first trucks and roads – used legislation to make the cost of transport higher for everyone, rather than lower for everyone by spending money on capital works and/or better locomotion.
The cat was well out of the bag and the horse bolted by the end of WWII.
Sure, the railway met the needs of its builders, for whom horses, drays and sailing ships might have been the best they could hope for otherwise. Several hours to Whangarei versus ???? by alternative mode was a good deal.
But rail ALWAYS needed to be several orders of magnitude faster point to point than its competition to hold market share, because terminal times and costs would always be higher and undermine that advantage. Ditto pax and freight.
Not sure Liberty would agree with this though, having read his blog – but I’m a bit over the whole idea of Anglosphere settlement colonies. Not sure what NZ is actually “for” (nor Australia, where I live).
It’s not just the economics of rail transport in thin markets – but also the question of whether there really is any purpose besides short term extraction for export to the old world, versus genuine settlement.
All the real settlement appears to have gone to the USA, where I guess they were more open to capitalism and immigration. And it was closer to Europe. And did Europe actually need multiple dumping grounds for its surplus pop?
To sum: I’d like to see the line beyond Waitakere stay open, having been to Helensville last year by train when you still could. Lovely, scenic, a world gone by.
But you couldn’t have bribed a surveyor to draw a more indirect route to the sorts of places where business is actually done north of Auckland.
A few hundred extra navvies digging deeper cuttings, and a few more estuarine bridges we might not having this forum now. The route to the north would be a logical, fast and seemless extension of the NIMT traffic to Wellington via ferry to the south.
But those 19thC people didn’t nor did the early 20thC people who should have known better, and had more resources at their disposal.
Northland Regional Council begins its annual planning exercise next month. It will be a chance for people to have a say.
Kind of begs the question of whether we ought to be thinking about a completely new rail line up the east coast. Pricey, but think of the tourism and economic development benefits for the north. A game changer in the same way that the Kaimai tunnel was http://en.wikipedia.org/wiki/Kaimai_Tunnel. Cost could be reduced, perhaps, if rubber tyre technology capable of climbing hills rather than requiring tunnels were to be used, increasing the scenic merits.
PS – a propos of rubber-tyred rail, while steel wheels are supposed to be much more efficient in terms of rolling resistance than rubber, that gap has narrowed somewhat with the development of modern low rolling resistance formulations. All the more so if the tyres are solid, on steel rails. The fuel savings vis a vis highway running are probably greater than the last step to steel-on-steel, which might not be practical, and also raises noise issues for an eastern alignment (rubber on steel is very quiet). That would be an issue for Matakana, Warkworth, etc.
I know there are various examples of rubber tyred metro systems, but are there any that carry freight? And let’s not forget this is NZ we are talking about, passenger rail is hard enough to promote, rubber tyred systems would be considered something like witchcraft or fairy tales.
I like the idea of an eventual North Shore line to Orewa, and from there it is a mere 10km to the existing NAL at Tahekeroa. Such a route could cut almost 50km off the run north, and if done to regular heavy rail standards it could carry both commuter and long distance passenger and freight trains with ease (although this would require some way to account for the harbour tunnel, electrification of the line, locomotive changes in the vicinity of Orewa or the use of dual mode electro-diesel locomotives and EDMUs.)
Wellsford might become the northern equivalent of Pukekohe getting two commuter trains an hour, and an intercity train could reach Whangarei in maybe two and a half hours, and the Bay of Islands in three and a half.
In a country that can barely manage to sustain rail lines beyond the NIMT, Picton-Dunedin, Hamilton-Tauranga, West Coast lines, the idea of more is economic fairyland. The volumes of traffic are simply not great enough. The Murupara-Taupo railway proposal didn’t add up, even though it might have had 5-6 log trains a day. Rail freight to justify a new line needs volumes akin to that of the NIMT, that means long container trains hourly. There wouldn’t be that amount of freight moving between Northland and Auckland, as Marsden Point takes most of the bulk commodities out. Unless a passenger rail service can go to the Bay of Islands faster or substantively more scenically than road, it wouldn’t be worth it, and it wouldn’t be more than once daily, which wont justify a line.
The Otiria-Kaitaia and Marsden Point branches would need to be worth it first, and sadly neither are.
@liberty have just shown your total lack of knowledge of the current railway network, and at the same time proved our point.
The Palmerston North to Napier and New Plymouth lines and Dunedin to Invercargill are both very busy with Dairy traffic especially, so would certainly not be shut down. However in the early 90s they were quiet and not so profitable. However the growth of Dairy and Fonterra’s strive to rail more freight has seen them become profitable.
Also the Murupara – Tauranaga line has something like six 40 wagon log trains each way a day.
If we had listened to the lovely folk at the Treasury in the 90’s those lines would have all been shut and the country, the roading budget and Fonterra’s efficiency would be suffering as a result.
The point is we do not know which lines could become busy in future years, so for the sake of the cost of a passing lane per year they should be kept open.
I know I’ve said this before – the NAL line is so scenic it must have great potential for tourism. Qv the Overlander. Tourists wouldn’t care too much if the journey is slow, more time to enjoy the scenery.
Luke: Palmerston North to Napier means Palmerston North to Oringi. Origi-Napier is marginal in terms of recovery of long run capital costs. It wouldn’t be closed, but it faces some long term issues in terms of replacing viaducts or bridges if there was a serious earthquake. Dunedin-Invercargill is certainly better, I wasn’t saying either would (or should) close, but rather that they aren’t serious contributors to profitability when you take long run capital costs. Certainly if neither existed nobody would build them.
Murupara-Tauranga, 6 40 wagon log trains is actually not a lot by international rail freight standards. It makes a positive contribution that’s for sure, but it is telling that extending that line has been off the agenda for a long time now.
Treasury didn’t recommend closing those lines in the 1990s. The Treasury report to Cabinet on rail privatisation simply said that the only issue if the rail network was shut down was congestion in Wellington. The road budget matter is a long worn fallacy, because the RUC generated from heavy vehicles would easily have covered additional maintenance costs, but yes Fonterra would have faced higher transport costs (though let’s not have the taxpayer subsidise that).
Nevertheless, I support mothballing because it would be an appalling shame to lose the opportunities to use corridors that might otherwise have fallen into disrepair. The Rotorua and Castlecliff cases in the past year or so prove that value. The issue comes with lines that face seriously expensive repairs due to major damage – the Tapanui branch being an example 30 years ago where flooding simply made this useful marginal forestry line uneconomic to replace.
The additional RUC’s would cover maintenance costs, but I doubt they would cover the cost of all the extra passing lanes needed. This would be especially true of routes with difficult terrain, for examples the Marton – Hawera line which is busy with milk traffic, and if that was roaded many more passing lanes would be needed. Rail maybe marginal on long run capital costs, but the difference is fairly minimal.
Roads do not have to recover their long term costs, and if roads were required to make money directly no one would ever build new ones. For example if a road is realigned this reduces fuel use, and therefore revenue, with no extra revenue gained.
As for disasters most road bridges would be ‘uneconomic’ to replace if there was an earthquake, but it would be done because the the wider costs to the community if they were not replaced.