News / MSC eyes joint ownership of Spanish intermodal operator Renfe Mercancías

© Joserpizarro Dreamstime.com

MSC, via its logistics arm Medlog, has been selected as “a potential strategic partner” of Spanish state railway Renfe Group’s loss-making rail freight subsidiary, Renfe Mercancías.

It follows an international tender that also saw Maersk and CMA CGM short-listed.

Renfe Group said the move was designed “to guarantee the long-term sustainability of Renfe Mercancías” and “allow us to expand our business and improve our profile as a logistics operator, with a strong presence in the ports”.

The company said the jobs of Renfe Mercancías’s 945 staff were “guaranteed”, their choice being to take up posts in the new entity or elsewhere within the rail group.

However, labour unions have already expressed concern that the arrival of Medlog amounted to “privatisation in disguise”.

Renfe has not disclosed the precise terms of the deal, but Spain’s El Pais newspaper noted that initial negotiations had focused on the creation of a 50:50 joint-venture company between Renfe Mercancías and Medlog, whose rail freight arm is Medway.

The Loadstar contacted MSC, but no-one was available to comment.

The Switzerland-based MSC group has experience in the Iberian rail freight sector, absorbing Portugal’s state-owned CP Carga in 2016, out of which Medway was formed.

A few weeks before the launch of the tender, Medway CEO Bruno Silva said the integration of rail operators into logistics groups would “bring more competitiveness to the sector”.

Spanish media reports claim that since 2011, Renfe Mercancías has run up losses of more than Є400m. It posted a positive result in 2019, largely due to the sale of its Logirail unit, but last year was in the red to the tune of Є38.4m, from revenue of Є231.7m.

However, Renfe Mercancías has by far the biggest share of Spain’s rail freight market, and last year handled more than 640,000 teu, down 4.3% on 2021.

But its management’s attempts to put the company on an even keel have failed against a backdrop of stiff competition in the sector and, above all, from other modes, such as road haulage.

The company has announced an investment programme of Є122.7m to promote its decarbonisation project, including the acquisition of platforms and wagons for freight transport via rail motorways; high-capacity electric locomotives powered by 100% renewable energy; installation of noise reduction systems in wagons; provision of the ERTMS safety system in locomotives; and the digitisation and optimisation of processes and services in freight transport centres.

As recently as last week, Renfe Mercancías received a grant of Є13.7m from Spain’s Ministry of Transport, Mobility and Urban Affairs towards its environmental efforts.