B.R.S. Chairman Warns Railways Against Rate War
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Railways Should Concentrate on Traffics to he Carried in Large Quantities Over Long Distances
ilthe railways began a rate-cutting war, the results would be disastrous for road and rail alike, Maj.-Gen. (3. N. Russell, chairman of British Road Services, said in London on Monday.
Delivering the Henry Spurrier Memorial Lecture to , the Institute of rransport (of which he is vice-president). he urged the railways to reformulate their commercial policy and use their charging powers on lines that would confine their activities broadly to those "in which they can and will present a real challenge to the road."
They should seek traffics to be conveyed in large quantifies over long distances and adjust the charges accordingly. They should refrain from carrying traffics for which they were not suited, although this might well mean a large reduction in their size.
The accident of history had caused the railways to be cluttered up with large quantities of traffic which no one would have' dreamt of sending by rail had the internal-combustion engine been invented before the locomotive.
During his recent visit to the United States and Canada he was greatly impressed by the fact that road transport was frequently able to beat the railways in transit time, even over long distances, because of the delays in sorting, shunting and marshalling trains.
Economics the Test Once a load had been put on a road vehicle its transfer to rail would be justified only when there was a clear economic advantage in doing so. If the railways ,concentrated on bulk movements of freight, it should be possible to build up complete train-loads whichwould move quickly from point to point without shunting and marshalling.
If the railways were to meet road operations on even terms, the ultimate test was net revenue. For a century the railways had been preoccupied with gross revenue and had been content to consider net receipts in the aggregate. It should now be possible, however, to make sure that there was an adequate net return on particular movements of traffic.
There was little use in the railways wasting effort in doing what road or air could do better, merely for the sake of getting traffic at any price.
"If traffic is diverted from road by means of an unduly low rate or charges," said Maj.-Gen. Russell, " there will be no advantage in net revenue to rail. To the extent that road is deprived of traffic which it is most suited to carry, it will tend to seek less suitable traffic, probably cutting the rate in the process, and the ultimate result will be a depressed market, with disastrous financial consequences for road and rail alike.
" From what I have seen in America, I suggest there are four major fields which should be the prerogative of the railways: (a) Commuter traffic: (b) rapid inter-urban passenger traffic; (c) point-topoint train-loads of merchandise in suit c22 able containers, and (d) train-loads of minerals " There is a great deal of long-distance traffic which ought properly to stay on the roads, just as certain short-distance traffic is properly moved by rail—commuter traffic, for example. There is no question of ' divine right' to traffic generally, or to any class of traffic, whether classified by reference to mileage or to any other arbitrary factor. It is, therefore, necessary for the railway approach, even to long-distance traffic, to be discriminatory, otherwise there might be a wholesale depression of rates, to the detriment of everyone engaged in the industry.
" If the railways succeed in setting themselves up as the efficient medium par excellence for moving bulk loads quickly over long distances, a development of co-operative working between road and rail should result. It is, I think, significant that in the U.S.A., where competition between road and rail is deadly keen, there is a growing feeling that the future lies in co-operation between the two forms of transport."
The piggy-back system which was being developed extensively in America, hardly applied to Britain because of the railway loading gauge. Methods by which the load was transferred by mechanical means were preferable in this country, and would give a better payload for rail and release road equipment.
Dealing with the framework within which the various systems of transport. would best operate, Maj.-Gen. Russell said that the first question was whether the right degree of competition existed. Competition provided the unanswerable test of the profitability and efficiency of an undertaking, but its advantages could he bought at too high a price.
Direction of Investment
The consequences of employing capital to create duplicate facilities could be extremely serious. Instead, investment should he directed into those charnaels where, with a wise commercial policy, the inherent benefits of each form of transport could be used to the best advantage.
Maj.-Gen. Russell opposed a monopoly in any form of transport and said that it would be foolhardy to tamper irresponsibly with the user's .freedom of choice. Competition was necessary, but the question was where to draw the line.
There was little or no competition, except for the private car, between individual passenger undertakings in road, rail and air transport. Competition existed only between the three forms of transport. On the freight side, there was a high degree of competition, not merely between road and rail, but also between the privately owned and nationalized sectors, and between individual privateenterprise hauliers.
The economic welfare of the country depended upon the correct play of competition.
Maj.-Gen. Russell believed that Britain was lagging behind other countries in the development of transport, but thought it should be able to profit by experience elsewhere and re-establish itself in the forefront of world progress.
Staff must face changes and individuals must be fitted into the new circumstances. The disturbance to individuals should not be allowed to outweigh long-term advantages to the community as a whole. The problem of taking full advantage of modern techniques and fitting the right men into the right jobs must be approached with a flexible mind. It could be solved only by management and trade unions working together with trust and harmony, each keeping the other closely informed of the march of events.
A far higher standard of discipline was required in transport, not, only by transport staffs. but by users.
Behind the Times The failure of transport to -keep abreast of the times had probably three underlying reasons. The first was that transport men were inclined to be conservative. Secondly, they were usually short of capiyal. Thirdly, customers were not always co-operative. A change in technique often required an alteration to the customer's premises, and normally this could not be done..
Of the many subjects for investigation, the first was the development of vehicles. and Maj.-Gen. Russell wondered whether the gas turbine was being studied sufficiently energetically. Great improvements could be made in traffic handling and in clerical arrangements.
An even flow of _traffic was important in passenger as well as in goods transport. Flows of traffic needed to be studied to avoid conflicting movements, and appropriate arrangements should be made at exchange points between one form of transport and another to move the maximum number of people with the minimum of inconvenience,
Methods of carrying traffic ought also to be considered. There were possibilities in bulk haulage for both liquid and dry goods. Methods of transferring loads from road to rail and from land transport to ships required investigation. The possibilities of pipelines should also bc reviewed.