Transcript Jabotabek passenger services

Indonesian Rail Masterplan
Market Assessment
The role of rail in the Indonesian transport
system
Outline
• Background/setting
• The role of rail in transport system
• Overview of performance
• Strengths of rail
• Impact of sector policies
• Implications for market assessment
• Java main line passenger
• Jabotabek passenger
• Java freight
• South Sumatra Coal
• New coal lines
Approach to Market Assessment
•
•
Key principles
– price: impossible to assess demand without considering price
and competition
– cost: impossible to consider price without considering cost
– Here: economic cost not financial cost. Because point of view
• Government
• economic efficiency
Questions
– Strengths of rail: what is role of rail in transport system
– demand for rail in the transport markets considering cost and
price
The role of rail in the transport system
•
•
2 approaches to identify role of rail
Performance in market
– By main tasks/lines of business
• Based on revenues
– Growth of passenger/km, tonne/km
Comparison of costs for different tasks
– Scenario analysis
– Tonne/km cost of rail versus road
Overview of performance
PTKA revenues by main line of business 2008
Line of business
% of revenues
Java main line passenger services
45
South Sumatra Coal
27
Jabotabek passenger services
9
Java freight
8
Java local passenger services
4
Other
7
Total
100
Java main line passenger
passenger/km and yield
• Overall decline of 3% p/y since 2000
– Traffic declined sharply early 2000s but is recovering since
2004
• Highlights 2000 - 2008
– executive: + 0.7 % and yields and distances are good
– business: - 4.4 % and lower yields
– economy: -3.8 % low yields are topped up by PSO
– local: + 7.2 % low yields are topped up by PSO
– Conclusion: loss of market share – except for local
• This requires in-depth analysis – market research
– When was high point reached
– What was impact of deregulation in competing modes
– What was impact of aggressive performance competition
– What was impact of economic crisis
– Other factors ???
Jabotabek passenger services
passenger/km and yield
•
•
•
1981 – 2008 :
– overall steady growth 7.1 % p/y
– but 2.8 % since 2000
Highlights 2000 -2008
– economy: slight decline of 0.3 % p/y - very low yield compensated
by PSO
– decline compensated by introduction of A/C and commercial
– much better yields for commercial and economy A/C
– commercial approach by PTKA
Jabotabek market segment also requires careful analysis
– Scope for further service differentiation - higher yields
• Commercial 250 Rp/pass/km compared to 43 Rp/pass/km for
economy
– Scope for developing new markets in context of suburban rail
transit development integrated with urban development
Java freight services
• Highlights
–
–
–
–
–
–
–
Java freight = 8 % of PTKA revenues
Peak probably in 1996: 1,440 tonnes/km
Since 1996: traffic - 2.1 % p/y
Traffic composition has changed considerably
Yield per tonne/km: Rp. 254
Cost per tonne/km: Rp 500 ? Rp 600 ?
Loss per tonne/km: Rp. 250 ? Rp 350 ?
• Question: Which cargo has future
– Need for detailed traffic costing
– Focus on profitable services
– Exit strategies for unprofitable services
South Sumatra coal traffic
• Highlights
– 2008: 10.5 million tonnes – 4.4% p/y since 1991
– Coal traffic = 27 % of revenues of PTKA
– Coal > than 91 % of freight revenues of SS Railway
– yield Rp/tonne/km: Suralaya: 250; Kertapati 313
– Haul distance (km):
409
162
• Question: why vertical separation
South Sumatra Freight Revenue
Type of Freight
Proportion
(%)
Suralaya Coal
Other Coal
Petroleum Products
Other
Cement/Klinker
81.7
9.7
5.4
2.2
1.0
Total
100.0
New coal railway lines
•
•
•
•
•
Several studies and proposals for new lines
Sumatra:
– objective: to enable increase in production
– part of new logistics chain from mine to a vessel loading point
– example: new line to transport Bukit Assam coal to new deep
water port at Tanjung Api Api, also involving construction of a
bridge across Musi river: 3 major investments !
Kalimantan:
– part of logistics chain for a new mine (or group of new mines)
to a vessel loading point.
– example: proposals for Kalimantan lines.
Feasibility is dependent on outlook in coal markets and ability to
obtain firm purchase agreements
Challenges impeding realization
– all elements of logistics chain need to be developed
– approvals of many central and local govt agencies
Strengths of rail compared to road Impact of
volume and distance
• Rail - total operating costs
– Java freight: Rp/t/km ??
– ESS coal: Rp/t/km ??
• Why is cost Java more than 2 times higher ?
Total volume
Hauling
distance
(Million tonnes
2008)
Java (mix of general
(km)
4.3
258
8.5
405
cargo)
Suralaya coal
(block train)
500 Kilometer Haul – Siding to Siding Versus Pickup And
Delivery Costs
1600
1400
Rail New Inf rastructure - pick
up and delivery
Rp/ton/km
1200
Rail New Inf rastructure siding to siding
1000
Road New Inf rastructure
800
Road Existing
600
400
200
0
1 million tons
3 million tons
5 million tons
Rail versus road - impact of volume
500 km haul - Rp/tonne/km
• Scenario analysis – rail versus road
– Road is lower cost at low volumes
– As volume increases, unit cost of rail declines
• Rail: siding to siding
– rail is only lower cost than new road at 5 million tonnes
• Rail: pick up and delivery cost
– road remains lower cost even at 5 million tonnes
250 Km Haul - Siding to Siding Versus Pickup And
Delivery Costs
1800
1600
Rail New Infrastructure pick up and delivery
Rp/ton/km
1400
1200
Rail New Infrastructure siding to siding
1000
Road New Infrastructure
800
Road Existing
600
400
200
0
1 million tons
3 million tons
5 million tons
Road versus rail - impact of distance
250 km haul - Rp/tonne/km
• Scenario analysis
– When pick up and delivery costs
rail can not compete with road at 5 million tonnes
• Java freight – typical conditions
– 250 km typical hauling distance
– total volume < 5 million tonnes – and mixed cargo !
– large proportion of cargo requires pick up and delivery
• Outlook for rail ? ?
– need to be very selective
Theory and reality
why is rail carrying traffic that would be lower cost by road ?
Combination of factors
•
•
•
No charging for infrastructure
– rail and road are competing on basis of their operating costs
– higher rail infrastructure cost are not recovered
No detailed traffic costing
– rail may not be fully aware of the real costs of some traffics multi-product enterprise
– depreciation on basis of historical cost
– Govt. contributions in kind in the past
business as usual – legacy of past
• is not sustainable.
• “above rail” costs are probably not recovered
How to ensure that rail plays its role
performs the tasks for which it is best suited
• Context - market economy
• Private sector firms in other modes constantly innovate and
reduce costs
• passengers and cargo owners make choices
• Easiest if prices/tariffs reflect economic costs
• Including external costs
• Ultimately largely an issue of sector policies
• Infrastructure investment
• Infrastructure pricing – level playing field
• Price/tariff regulations
• Entry and exit regulations - all modes
• Policies affect modal shares
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December 8,
2009
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2009
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Java commercial passenger services
• Approach to forecasting demand - micro
– market by market – service by service – OD
– what is competition doing
– relative prices – quality of service
– elasticity measures
– understanding shifts in demand
• Implications
– Lead role – PTKA/train operator
– Need for accurate cost data for business unit/service
– Need for coordination between infrastructure and
operations
– Focus on capacity requirements at the level of facility and
corridor
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Java economy passenger services
• Approach to forecasting demand - micro
– BUT
– Demand depends on fare
– Fare depends on cost and PSO subsidy
• Implications
– Need for stable agreement between government and
PTKA/train operator on level of subsidy (PSO)
– Need for traffic costing data by business unit/service
– Government/MOT to develop concept of: (i) target
population; (ii) level of support justified; (iii)
mechanism for PSO delivery
– Need for coordination between infrastructure and
operations
– Focus on capacity at level of facility & corridor
Java freight services
• Approach to forecasting demand - micro
– market by market, service by service, OD
– knowledge of: competition, door-to-door costs, quality of
service, initiatives by competition
– changing industrial location
• Implications
– Lead role – PTKA/train operator
– Need for accurate cost data by business unit/service to
support decision to produce & pricing strategy
– Need for coordination between infrastructure and train
operations
– Focus on capacity requirements at the level of facility and
corridor – eliminate bottlenecks
Jabotabek passenger services
suburban commuter rail
•
•
•
Requirements for efficient metropolitan transport
• integrated multimodal system
• based on complementarity between modes
• need for metropolitan entity
(1) prepare a coordinated metropolitan transport plan; (2)
deliver integrated system; (3) providing integrated services
Role of Jabotabek rail in metropolitan transport
providing high volume suburban commuter transport
Issues
• Commuter rail is very costly – how to optimize its role
• experience shows that fare box can not cover operating costs
Financing has to be supplemented with other metropolitan
income ideally from those who benefit from the economies
of agglomeration
Jabotabek passenger services
• Approach to forecasting demand
• Identify role of suburban rail in overall transportation system
• based on relative costs of modes
• Macro modeling approach
• based on O-D and modal split is preferred
• Planning work has already been done
• The Study on Integrated Transportation Masterplan for Jabodetabek
• detailed recommendations on investments & actions
• Implications
– need for separate business unit for Jabotabek train operations –
operational and financial autonomy
– client of business unit = metropolitan transport entity
– strong focus on traffic costing to underpin level of subsidy
– stable pool of funds from various sources/modes
Integrated land use and transport planning
Goal
to enhance the role of rail in metropolitan transportation
How
– Transit oriented urban/suburban development
– Central concept: ACCESSIBILITY
– Promotion of public transport
In practice (Jabotabek Masterplan Study)
– Improve quality of rail services
– Upgrade railway stations & intermodal connections
– High density real estate development in vicinity of railway
stations
Concept for railway catchment area
South Sumatra coal
Approach to forecasting – institutional status quo
• Long term - only one major client
• ideally: long term contract
• BUT: credibility of off-take commitments by mining company
• Medium term – coordination/synchronization
• Production planning of the mine
• Transport capacity planning of railway
• Agreement between 3 parties on
• Volumes
• Operating procedures at transhipment points
• Operating indicators
• Cost sharing on rolling stock
Kalimantan new (coal) railway lines (1)
• Obstacles to implementation in past
– short distances
– collaboration between mining companies for minimum
volumes
– coordinated development of ENTIRE logistics chain:
challenge
– lack of legal and regulatory framework for private sector
financing
• Principles
– integral part of mining scheme (mining permit includes
transport)
– mining company fully responsible for
• identifying least cost logistics chain
• developing, financing and operating all elements of the
logistics chain
– Government = facilitator
New (coal) railway lines (2)
• Outlook has now improved
– Minimum volumes (5-10 million tonnes)
• available in principle in Kalimantan
• In Sumatra if major increase in output at existing location
– Legal framework available
• Remaining issues/challenges
– Implementing regulations to be developed
– Collaboration for minimum off-take commitments
– Government facilitation and coordination during
development stage
• One stop shop