Thursday 19 November 2009
Rail Freight

Rail Freight Portal, Member of the month, interview with Dr Dirk Stahl CEO, BLS CARGO AG

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Efficient, reliable and as flexible as a Swiss army knife

Dirk Stahl doesn’t believe in the parable of the seven fat years and the seven lean years. This 43 year old Doctor of Economics and CEO of BLS Cargo is too matter-of-fact for that. What is more, he is a man who has always followed the path of progress. He started at Deutsche Bahn in the mid-nineties and since 2000 he has worked for the biggest ‘private’ rail company in Switzerland. Since it was founded, in 2001, BLS Cargo has booked brilliant results for seven years in a row. It finished the 2008 financial year with a turnover of 187 million CHF (124 million euro) and a profit of 3 million CHF (2 million euro).

“Our business model has proved very successful in the past”, says Dirk Stahl. “As a lean organisation we have also proved in recent years that we are extremely flexible and can take advantage of changes in the market, so we are firmly convinced that BLS Cargo will emerge from the recession stronger. After all it is no different for us than for all the other companies offering rail transport – there has been an ongoing decline in the demand for rail transport since autumn 2008. With a production of 1,505.6 tkm we booked a 22% fall in the first half of 2009 compared to the same period last year.”

Versatility maintained through cost cutting

Dirk Stahl: “Let’s be clear about this, in the first three
quarters of 2008 we were still showing a nice growth curve. But from November onwards the number of trains suddenly took a nosedive of 13 per cent compared to October. This drop was visible in pretty much all segments, but was even more significant for container movements from the North Sea ports. In the first few months of 2009 we had to contend with increased price competition from road transport as well as the cyclical decrease in transport and we shouldn’t forget the less favourable euro/CHF exchange rate.”

Dirk Stahl: “We had a drop of 29.5 per cent in international intermodal and conventional transit traffic for the first half of 2009. Our inland services, RO/RO and Rolling Highway traffic remained stable – with a rise of 5 per cent. This is the first time in the history of BLS Cargo that we have been confronted with a negative result in the half-year accounts. In autumn 2008 we proved conclusively that we are fast movers. We took intelligent action to cut back on over-capacity in our production resources, we were quick to put the brakes on investments temporarily and we hired out our traction units and drivers on other routes.”

Dirk Stahl: “Altogether these measures saved us a good 9 million CHF (6 million euro), which partly compensated for the decline in demand. Besides that we also set up an efficiency programme, The Rise 2011, with a view to optimising the deployment of resources and personnel even more. In other words we used the economic slump to our advantage to get BLS Cargo back on track for sustainable positive business results. Being an extremely versatile organisation like this means we will continue to be able to give our clients vigorous support in the achievement of their growth plans as soon as demand picks up.”

Over 100 years of rail experience

Dirk Stahl: “For the origins of our parent company we have to go back to 1906, when the Berner Alpenbahn Gesellschaft Bern-Lötschberg-Simplon was founded for the construction of the Lötschbergbahn. This Alpine railway line was finally opened in 1913 and immediately became a major sensation worldwide. A good 90 years later some smaller companies merged with BLS and then there was the merger with Regionalverkehr Mittelland to form the present BLS AG. Nowadays 75% of the company is in the hands of the Swiss Confederation and the cantons of Berne, Lucerne, Solothurn, Wallis and Neuchatel.”

Dirk Stahl: “Under the influence of the wave of privatisation that affected nearly all European rail companies in the new millennium, BLS AG set up the BLS Cargo division in 2001. Barely a year later, BLS Cargo was launched on the stock exchange with a view to developing strong European partnerships. External shareholders were integrated the same year. In the current share portfolio BLS AG has a 52 per cent stake, DB Schenker Rail Deutschland AG 45 per cent and the Italian IMT AG (Ambrogio Group) 3 per cent.”

Dirk Stahl: “Anyone who can read will understand immediately that with that kind of pedigree you have a lot of potential. Nowadays we are one of the leading rail operators for transalpine goods traffic, with over 40 per cent of the market share of international transit consignments through Switzerland. We offer joint services with DB Schenker for the transit of both combined transport and conventional truckload traffic to Italy via the Lötschberg, Simplon and Gotthard, sharing each other’s traction units and personnel to ensure maximum efficiency straight through rail transport. We also offer our clients custom-made on-site logistics and feeding services.”

Strong stable partnerships for European rail transport

Dirk Stahl: “Our great strength, of course, is that we are quite literally a lean and mean machine. Lean because we have an extremely compact organisational model – 85 employees who fall directly under BLS Cargo and another 400 indirect employees, such as engine drivers and maintenance people, from BLS AG. We work with dedicated teams from our Cargo Control Centre in Bern, where management, production and sales are centralised. These teams possess extensive knowhow and are extremely close to the clients.”

Dirk Stahl: “I would also dare say that we are mean because we jumped on the liberalised market bandwagon at the right time. Besides that, our assessment of the growth potential of the Swiss transit market for the Rotterdam-Milan corridor was correct, taking into consideration, as it did, the opening of the new 34.6 kilometre long Lötschberg base tunnel in 2007. After the Gotthard railway this is the most important north-south axis through the Alps. We were also mean in our search for solid partners for the development of the European market in the direction of Germany, Austria, Italy and France. You could say we never sold ourselves short. The majority shareholder of BLS Cargo is still Swiss, although we are fully integrated in DB Schenker’s Europe-wide production network. But that is exactly why we can enter into stable partnerships with our clients.”

Dirk Stahl: “And finally, we offer DB Schenker and the other partners our specialised knowhow concerning the Alpine route, combined with high operational reliability. Take, for example, the Rolling Highway (Rola for short), from Freiburg (Germany) to Novara (Italy), for which we supply some of the traction units. We have 22 truck-transporting trains a day on that route via the well-known Lötschbergbahn. Another plus from these close partnerships is that we can deploy our traction units more efficiently. Drivers can stay on their engines across the borders, which shortens border stops.”

The Alpinists

Dirk Stahl: “Our ultimate objective is to combine the strengths that differentiate the various partners in order to create added value for international clients. This is what led us to reposition The Alpinists – in other words, what do our clients think is unique about our service? The answer is as short as it is simple, that the Alps are absolutely no obstacle when it comes to reliable, efficient and fast goods traffic. As an experienced alpinist BLS Cargo knows the ideal way through the Lötschberg-Simplon and Gotthard routes.”

Dirk Stahl: “And more than that, we continue to make investments, too – in new multisystem locomotives, for example, that we can use on the rail networks in Germany, Austria and Italy. At the same time, this is also the way to promote the modal shift from the road to rail. Because, let’s be honest, compared to road transport rail transport has a lot of advantages over long distances and in the effective bundling of goods flows. Transport capacity will be approximately doubled with the new 57 kilometre long Gotthard basic tunnel – operational from the end of 2017 – with its much smaller gradients and therefore faster passage. We’re certainly looking forward to making maximum use of it!”

For more information please contact Gustav Manding:

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