The subsidy is granted by the Ministry for Innovation and Technology and disbursed by MÁV Zrt. as subgrantor. In the next five years state contribution totalling HUF 26 billion will enhance the competitiveness of sustainable rail freight transport. Maintaining the services provides a long-term workplace for almost 2,000 railway employees, supports the better utilization of the railway track capacity and unburdens the roads of the traffic of ca. 400 thousand trucks.
Based on the decision of the Hungarian government and on the approval decision of the European Commission, in 2021 rail freight companies can apply for an expected grant of HUF 1 billion for maintaining their single wagon transport services. In the period between 2022 and 2025, the eligible budget is HUF 6.4 billion per year. State grant for single wagon transport as an initiative of the HUNGRAIL Hungarian Railway Association, the number one professional advocacy organization in the Hungarian railway sector, is an important milestone, thanks to which railway offers an environmentally friendly alternative also for businesses that need to move volumes of goods only up to a few trucks at a time.
Tamás Schanda, Deputy Minister, Minister of State for Parliamentary and Strategic Affairs of the Ministry for Innovation and Technology stated: “The state grant stabilises the field and makes it predictable, brings an estimated 2-4 percent increase in turnover in the medium term, thus also strengthening the sector’s GDP-generating capacity. Thanks to the intervention, we will be able to protect thousands of jobs. The preservation of capacities is essential for Hungary to become the freight, logistics and distribution centre of Central Europe in accordance with the goal set in the railway program.”
Róbert Homolya, President-CEO of the MÁV-Volán Group, President of HUNGRAIL highlighted, that the grant can renew single wagon transport, stabilise the operation of the segment, and replace developments and investments, thus bringing the railway even closer to businesses. MÁV, as a reliable service provider, provides the infrastructure, the shunting operation and mostly traction as well, as well as traction current and the necessary IT conditions. HUNGRAIL will actively support its member companies with the request of the grant in the future as well, make suggestions for improving service quality, and participate in the development of IT systems for measuring performance and accounting.
Imre Kovács, member of the Board of HUNGRAIL Hungarian Railway Association, Chairman of the Board of Rail Cargo Hungaria emphasised: “The signing of the agreements gives the Hungarian national economy a competitive advantage over those countries that do not help to maintain single wagon transport. With this railway logistics solution, rail freight companies carry out the export forwarding of products of Hungarian companies, of which road transport is not permitted by the authorities of several European countries.
The contracts signed today will also bring us closer to meeting the climate targets, as the sustainable and clean single wagon transport replaces the traffic of yearly hundreds of thousands trucks on the road, preventing greenhouse gas emissions and reducing road safety risks.” – highlighted Imre Kovács.
In the scope of single wagon transport, the goods can be transport even in one freight wagon, directly from the location of the companies when industrial sidings are available. These single wagons arrive to a pooling station, where block trains are formed based on their target destinations. The single wagons reaching the pooling stations near to their target location in the block trains will be organised in trains according to their target destinations and reach their goal. Single wagon transport offering many advantages and being suitable for the transport of any kind of goods, is indispensable from an economic point of view. Its maintenance is enabled by state grant, which continues to ensure the raw material supply for 700 Hungarian companies, including large strategic concerns and SMEs, and that their products reach the markets.
The authorities of more European countries prohibit the road transport of several substances and products, hence for many Hungarian companies producing for export single wagon transport is the only solution. Single wagon transport services provided by the affected rail freight companies create safe conditions for transporting yearly 2.3 million tonnes of hazardous materials to their destinations in the future as well.
Maintaining the services provides a long-term workplace for almost 2,000 railway employees and supports the higher utilization of the railway track capacity.
The grant helps rail freight companies to maintain the number of employees required for service provision, to reduce the competitive disadvantage compared to road transport and to increase the flexibility of customer service.
Maintaining this transport mode is also promoted by the European Union, because without the grants its target, increasing rail’s share to 30% by 2030 and to 50% by 2050 on transport routes longer than 300 km, cannot be achieved. Without the introduction of the grant for single wagon transport, with a yearly transport capacity of 10-12 million tonnes and 1,500 million net tonne kilometres, this year, up to 400,000 trucks a year could have flooded the Hungarian public roads.
The CO2-emissions of rail freight per transport unit are seven times less then of road transport, and rail transport can also reduce noise pollution, prevent traffic jams and reduce accidents and their additional costs.