LTG Cargo Announces Move to Private Wagon Fleet, Enhancing National Security

From January 1, 2025, LTG Cargo, the freight transport company of the LTG Group, will discontinue the use of the shared wagon fleet in the 1520 mm gauge space as per the agreement with the Council for Rail Transport (CRT).

This shared fleet will be replaced by a private fleet comprising 6,000 wagons managed by LTG Cargo. This change not only enhances national security but is also expected to better meet the needs of customers who prefer more sustainable rail transport options.

"By moving away from the shared fleet model in the broad-gauge space, we are taking another step in transforming LTG Cargo's operations towards diversification to the West and aligning the company with agreements applicable in Europe. This is the second step in withdrawing from the CRT agreement: following the outbreak of the war in Ukraine, LTG Cargo withdrew its wagons from operating through Russia and Belarus, and this second step detaches us from the shared fleet system and transitions us to the European operational model, where the entire wagon fleet is private and will not be used by other countries' railway administrations," said Eglė Šimė, CEO of LTG Cargo.

The changing freight transport market, increasing customer demands, and the aim to boost rail transport volumes within the country are driving the search for new operational models. The private LTG Cargo fleet will be utilized in two ways: through long-term leasing and by providing wagons for one-time shipments. Approximately 10% of the private wagons will be allocated for one-time shipments, forming a so-called reserve wagon fleet.

"LTG Cargo aims to maximize the number of shipments using wagons leased through long-term agreements. This approach ensures clients have the necessary number of wagons regardless of seasonality, and allows them to choose the lease term that best suits their needs."

It is planned that the majority of freight transported by Lithuanian railways will be carried using wagons leased to clients through long-term agreements. This will account for 90% of the private LTG Cargo wagon fleet. Utilizing the leased fleet will increase wagon turnover, enabling a higher volume of freight transport with the same number of wagons.

LTG Cargo will be responsible for the major or scheduled repairs of both the wagons managed by clients under long-term leases and the reserve fleet wagons used for one-time shipments, ensuring their proper technical condition.

These changes only affect the wagon fleet managed by LTG Cargo. Wagons shared by other countries' railway administrations will continue to operate on the Lithuanian railway network. It is worth noting that the shared wagon fleet is managed by railway administrations, with usage rules set by the international CRT agreement made between different countries' railway administrations operating in the 1520 mm gauge space. This agreement allows the sharing of available wagons among different countries' railway administrations.

LTG Cargo, a company within the LTG Group, is actively pursuing integration and expansion in the West. The company provides freight transport, logistics and forwarding, cargo loading, and locomotive and wagon repair services, as well as wagon leasing in Lithuania and abroad. LTG Cargo has established and is managing LTG Cargo Polska in Poland and LTG Cargo Ukraine in Ukraine. In its effort to promote greener rail freight transport, the company employs a team of 1,800 logistics professionals. In 2023, LTG Cargo transported 27.2 million tons of freight. The company's revenue last year was approximately EUR 286 million, with a net profit of EUR 17.5 million.

 

Source: LTG CARGO Press Releases