Rail Cargo Group. China Belt and Road Initiative and Logistics Solutions

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1 China Belt and Road Initiative and Logistics Solutions Rafi Papo, Product Manager Turkey / South East Europe / Middle East, Rail Cargo Operator - Austria GmbH

2 Topics INNOVATION Changsha Budapest via Ukraine / Slovakia WHO WE ARE Member of ÖBB EURASIAN LANDBRIGE Why Rail & Future Challenges TURKEY NEW HUB BETWEEN EAST / WEST Chances & Challenges SUMMARY

3 Changsha Budapest via Ukraine / Slovakia

4 Topics INNOVATION Changsha Budapest via Ukraine / Slovakia WHO WE ARE Member of ÖBB EURASIAN LANDBRIGE Why Rail & Future Challenges TURKEY NEW HUB BETWEEN EAST / WEST Chances & Challenges SUMMARY

5 China s Belt and Road Initiative (BRI) 1 Rail forwarding with specialist sector competence Focus on core competence: railway logistics Transparency through simplicity and five businesses, each with its own model and markets (internal, external) 2 3 Operator for high-frequency long-distance routes Carrier for in-house traction provision ÖBB-Produktion GmbH Bringing together skills, resources and responsibilities 4 Wagon rental Consistent brand architecture 5 Rolling stock maintenance ÖBB-Technische Services GmbH Technical Services Hungaria Kft. Technical Services Slovakia, s.r.o. TS-MÁV Gépészet Kft

6 Key facts I Rail Cargo Operator Business model: Company Trains (single client) Open trains (multi client) ROLA (Rolling Road) Business facts: 400 trains per week / trains per year over 370 employees in 5 countries 7 legal entities 15 Terminals 2100 intermodal cars Strategic outlook: New traffics Extension of current traffics New markets Investments in terminals Target: Double volume up to 2 Mio. TEU in Turnover 300 Mio. p.a. Over 1 Mio. TEU

7 European Corridors NORD/WEST PORTS CORRIDOR Hamburg - Melnik v.v. Hamburg - Paskov v.v. Bremerhaven - Melnik v.v. Gdansk - Paskov v.v. Hamburg - Wolfurt v.v. Bremerhaven - Wolfurt v.v. Hamburg - Wien - Linz v.v. Bremerhaven - Wien - Linz v.v. Rotterdam - Wolfurt v.v Rotterdam - Wien - Linz v.v. Bremerhaven Rotterdam Ludwigshafen Duisburg Wörth SOUTH-PORTS CORRIDOR Koper - Dobra u Frydku Mistku v.v. Koper - Bratislava v.v Koper - Zilina v.v. Koper - Paskov v.v. Koper - Bratislava Wien Koper - Budapest v.v. Koper - Villach v.v. Piraeus Budapest v.v. Piraeus Pardubice v.v. Rijeka - Budapest v.v. Trieste - Budapest v.v. Trieste - Villach v.v. Trieste - Ulm v.v. Triest - München v.v. Trieste Paskov v.v. Trieste - Burghausen u.v.v. Neuss Dietikon Hamburg Trento Verona München Ulm Burghausen Wolfurt Wörgl Villach Fernetti Mělník Salzburg Trieste Koper Pardubice Brno Linz Castel Guelfo di Bologna Wels Wien Graz Rijeka Maribor Ljubljana Gdynija Paskov Prerov Bratislava Sopron Gdansk Žilina Kaliningrad Dobrá u Frýdku-Místku Budapest(BILK) Malaszewicze Curtici Sopron - Budapest - Istanbul Halkali v.v. Budapest Curtici - Ploijesti v.v. Budapest Vienna v.v. Budapest Munich Hamburg v.v. Budapest Wels - Neuss v.v. Budapest Trieste v.v. Budapest Rijeka v.v. Budapest Koper v.v. Budapest Piraeus v.v. Ploiesti CONTINENTAL CORRIDOR Duisburg - Ljubljana v.v. Neuss Budapest v.v. Wels - Duisburg v.v. Wels - Ludwigshafen v.v. Wien - Wels - Neuss v.v. Wels - Wien v.v. Wels - Dietikon v.v. Verona - Curtici v.v. Duisburg Curtici v.v. Wien Castelguelfo v.v. Austrian National intermodal transport Zilina - Kaliningrad v.v. Paskov Kaliningrad v.v. Zilina Malaszewicze v.v. Wien - Budapest v.v. Budapest - Curtici - Ploiesti v.v. SOUTH-EAST EUROPE CORRIDOR with antenna connections Istanbul Halkali Piraeus

8 Topics INNOVATION Changsha Budapest via Ukraine / Slovakia WHO WE ARE Member of ÖBB EURASIAN LANDBRIGE Why Rail & Future Challenges TURKEY NEW HUB BETWEEN EAST / WEST Chances & Challenges SUMMARY

9 Why Rail? One piece T-Shirt: 200g 40 HQ: 7000 kg Transit time between days Stable price structure and departure schedule Door Guangzhou to door Southern Germany (door-to-door) 0,06 USD days 0,21 USD days 0,24 USD days 0,60 USD 5-6 days Emissions factors by transport mode (per tonne km compared to air freight) Advantage of working capital, cheaper than Air Same customs procedure like sea Price Transit time / Capital Cost Sea Rail Sea/Air Air Rail Cargo Austria AG

10 What does BRI means Rail for EU? 5,000 cargo trains* Running from China to Europe annually by 2020** via three passageways: North, Middle & South 43 transport hubs There are 23 hubs now, 20 more will be opened by 2020 At least one connection with Europe per hub 6 hours target for border crossing stop For customs & inspection on Chinese side by 2020 >8 train departures per day In westbound direction

11 Challenges Border capacity don t keep up with rapid expansion of BRI (Belt & Road Initiative) rail services and cargo volume Lack of infrastructure at alternative borders Idling time and delays Border Capacity Issue Procedure Barriers Customs document translation to many languages HS code verification and conversion Customs offices don t work 24/7 Constant speed improvement is expected by the market Average cargo train speed is lowest in the EU No EDI / IT solutions to provide 24/7 cargo tracking on container level for public Train Speed & Tracing Network Development Less departures from European borders to European hubs Platform / wagon shortage during 1520 / 1435 trans-loading Track renovation in Europe causing disruptions Reefer container handling

12 Topics INNOVATION Changsha Budapest via Ukraine / Slovakia WHO WE ARE Member of ÖBB EURASIAN LANDBRIGE Why Rail & Future Challenges TURKEY NEW HUB BETWEEN EAST / WEST Chances & Challenges SUMMARY

13 Turkey New HUB between East and West St. Petersburg Moscow Ekaterinburg Omsk Krasnoyarsk Duisburg Hamburg Warsaw Brest Ilzek Zabaikalsk/Manzhouli Milan Budapest Chop Aktau Istanbul Kars Baku Vostochny Dostyk/Alashankou Dalian Pusan Osaka Incheon Tokyo Chengdu Suzhou Chonqing Changsha Breitspur Normalspur

14 Turkey New HUB between East and West Chances Congestion at Polish / Belorussian border Sanctions by Russia against EU Main Route between South East Europe and China Challenges Lead time on Turkish territory from Kars to Halkali MAXIMUM 48 hours Connection between Köseköy and Halkali Aktau Baku ferry connection frequency

15 Topics INNOVATION Changsha Budapest via Ukraine / Slovakia WHO WE ARE Member of ÖBB EURASIAN LANDBRIGE Why Rail & Future Challenges TURKEY NEW HUB BETWEEN EAST / WEST Chances & Challenges SUMMARY

16 Summary Road and Belt is giving extra power to boost up world wide economy RCG is committing to become pioneer to create proper logistics infrastructure along the road and belt policy especially on alternative routes via Ukraine / Kaliningrad / Turkey Alternative routes are needed as Polish / Belorussian border is collapsing Current challenges need to be examined carefully LEAD TIME Turkey can be a new hub between East and West if the infrastructure between Kars and Istanbul allows a smooth and fast operation Connected custom system and terminals concept should be developed

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