According to a McKinsey study, the European modal share of rail went from 60% of all supply chain transportation in the 60s to just 15% in more recent years. This dip is attributed to factors like the availability of cheaper fuel, abundant labour and the popularity of just-in-time logistics models.
However, there is currently a renewed interest in rail transportation. In fact, the European rail infrastructure is projected to grow at an annual compound rate of 4.52% and reach USD 185.04 billion by 2029.
The major reason for this change in tide is due to the fact that rail transportation has proven to be more sustainable and reliable – two attributes that are always in high demand in the logistics industry.
Sustainability on track
The transport sector is the largest contributor of greenhouse gas (GHG) within the EU. As a result, businesses in Europe are under pressure to reduce their GHG emissions by at least 55% by 2030. Rail transportation is a reliable alternative that contributed to the decarbonisation of supply chains.
An important part of this process is the adoption of electrified freight trains. In fact, currently, 60% of the European rail network is already electrified.
Reliability on track
Inland transportation in Europe is going through massive upheaval. From driver shortages, congestions and delays, to strikes and the repercussions of Brexit, there are many significant challenges that transform into supply chain struggles.
In this situation, rail offers the flexibility and durability to take on these challenges with fixed schedules, high capacity, enhanced security and reduced dependence on weather conditions.
Get your cargo on track with Maersk
In our e-book, Christian Carstensson Olesen, Global Product Owner of Cross Border Transportation at Maersk and Chris Moss, Head of Transported by Maersk Europe, discuss the current state of the European rail transportation sector.
Download it now to explore the biggest challenges faced by brands transporting cargo across Europe, why rail is vital to overcoming them and how Maersk is at the forefront of driving this progress.
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