South Africa’s rail sector is set to undergo a major shift as the newly established Transnet Rail Infrastructure Manager (TRIM) gears up to allocate rail slots to private train operating companies (TOCs). This marks a significant move toward integrating third-party operators, enabled by the release of the long-awaited Network Statement in December.
The Network Statement introduces a competitive tariff system designed to attract private operators, moving away from the revenue-based pricing model initially proposed. The tariff structure uses a two-part model based on train kilometers and gross ton kilometers, with differentiation by commodity and corridor. Applications for the first slots close on February 7, with preferred bidders expected to be announced after a 60-day adjudication period.
These initial slots will provide 2.4 million tons of capacity across key corridors, including manganese, iron ore, containers, magnetite, and chrome routes. However, current network capacity remains at 180 million tons annually, far short of the 250-million-ton target for 2030, due to significant maintenance backlogs and underinvestment.
TRIM Interim CEO Moshe Motlohi acknowledges the challenges, emphasizing the need for R65 billion in funding over the next five years to address maintenance and capital investment requirements. While Transnet can fund half of this amount, government support and innovative funding mechanisms, such as the Budget Facility for Infrastructure, will be essential. Collaborative models involving key customers on specific corridors are also being explored to share costs.
Despite these challenges, TRIM is pressing forward with integrating private operators by 2025. At the same time, the organization is working to solidify its own operations, including forming a permanent executive team, addressing maintenance and security issues, and improving signaling and IT systems. With 56% of Transnet Freight Rail’s workforce already transitioned to TRIM, the focus remains on creating a transparent and collaborative environment for private participation.
Motlohi emphasizes the broader vision for the rail sector: improving infrastructure to support economic growth and prioritizing national interests. “Our goal is to improve a network that is the backbone of the economy,” he says. By opening the network to private operators, South Africa aims to revitalize its rail industry and boost its economic potential.
29 thoughts on “Opening South Africa’s Rail Network: Transnet Prepares for Private Operators”
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Who can say this will be a game changer for low level workers of Transnet? This might benefit the top management structure of TRIM but what about the rest? I bet no one even thought of that.