Hungrail: profitability of rail freight carriers has deteriorated dramatically

By: Trademagazin Date: 2025. 04. 08. 09:01

The unit costs of rail freight carriers increased by 10.3 percent, while unit revenues increased by only 2.2 percent in the last quarter of 2024 compared to the same period of the previous year, so their profitability deteriorated dramatically, the Hungrail Hungarian Railway Association told MTI on Tuesday.

In order for rail carriers to compensate for the increase in costs, an additional 8.1 percent fee increase would have been necessary, but the railway companies were unable to enforce this towards their clients. This is shown by the Hungrail rail freight index, which the organization publishes quarterly. The competitiveness of the sector is decreasing, and performance is on a downward trajectory, they added in their statement.

The increase in costs in the fourth quarter is largely due to the increase in operating costs, wagon inspection costs and network access fees. The exchange rate also played a significant role in the average increase in specific rail freight rates – in the case of international freight – they wrote.

They noted that in the previous quarters, specific rates were even lower than in the last quarter of 2023, partly due to seasonal effects, partly to flexible rate factors, and partly because carriers were forced to reduce their rates in some cases due to competition with road transport – the Hungrail analysis showed.