TransNamib bets on locomotive refurbishments, leases to drive-up revenue

TransNamib is betting on the refurbishment of 33 of its locomotives and a lease of seven more to improve operational efficiency and drive-up revenue.

The rail company is currently faced with a locomotive shortage, with only 25 operational out of a requirement of 75, while the future of the renovation project hinges on the company’s ability to secure funding.

“TransNamib currently has about 25 locomotives that are actively operational.  In order to operate the business efficiently we need about 75 locomotives of which 50 locomotives are mainline locomotives and 25 locomotives used for shunting.  Our current operational fleet of 25 is being used for both mainline and shunting activities.  To sum it, TransNamib needs to significantly increase its capacity in order to achieve our strategic business plan.  With the leased locomotives, we hope to within the next few months see a significant increase in our revenue generation which will be boosted with the refurbishment of the 33 locomotives which will allow TransNamib to invest more in its rolling stock,” TransNamib said in response to an inquiry from The Brief.

Quizzed on why the company had reverted back to leasing locomotives, after having terminated previous agreements, the rail company said, “The leasing of the locomotives forms part of our short to medium term strategy to increase our capacity.  We have been quite transparent in terms of our challenges with outdated rolling stock – some of our locomotives are over 50 years old when the lifespan of a locomotive is 25 years. We have done as much as we can, and pushed as much as possible with the current rolling stock but in order to reach our plan of becoming a profitable company, we need rolling stock that is reliable and safe, hence the acquiring of the leased locomotives is a strategic decision for TransNamib to be able to increase its capacity immediately.  At the same time, we are working on improving our capacity in the long term, with the remanufacturing of 33 locomotives.  That project is currently awaiting confirmation of funding for our business plan.”

The company said the eight-month lease should would be a stopgap measure, while awaiting the completion of the planned locomotive refurbishment.

“The locomotives will be leased for a period of eight months.  Within those eight months we expect that the remanufacturing process will have started so that when the lease ends, we still have capacity to move more freight with more reliable locomotives. For TransNamib, leasing is only a short to medium term strategy.  We need to increase our capacity immediately to be able to meet the requirements from our shareholder in terms of transforming TransNamib.  Our current rolling stock is being utilized to its full capacity but we can only do so much with it.  While we are waiting on the process of the refurbishment of the locomotives to be finalised, we still need to operate and increase our capacities and efficiencies.  The leased locomotives will provide immediate relief to our business and propel us forward towards our vision.”

On how much derailments, which have been occurring regularly had cost the company, the rail operator was tight lipped. 

“While we cannot reveal the costs as we are still in the process of finalizing claims associated with these derailments, we can say that our business has been significantly impacted in terms of revenue.  We were however able to mitigate more impact by working to restore the lines within the shortest time possible.”

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Last modified on Friday, 08 October 2021 21:15

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