GB Railfreight – Rail for the 21st Century

We learn how GB Railfreight is working to bring the rail sector into a more sustainable age.

GB Railfreight’s origins lie at the turn of the century, in the post-privatisation rail market, where company founder and CEO John Smith saw a niche for a new rail freight company.

“We specifically set the business up to compete with the other rail freight operators created post-privatisation in 1995,” Smith recalls. “At the time there hadn’t been much competition within the freight operating market. We started with an initial contract with what was Railtrack and is now Network Rail, the biggest customer of rail freight in the UK.”

It was the start of a trading relationship that continues today. Kings Cross Station is currently undergoing renovations, and it’s a common sight at the station to see GB Railfreight’s trains coming in and taking material out.

The business is active across a number of key sectors- construction, energy, infrastructure, rail services, and what Smith calls a “catch-all” department for everything else. The company even carries out a little bit of passenger work, contracting to pull trains for other passenger-based rail services.

“We’ve grown the business through 20 years on a fairly organic basis and we’ve reached the point now where we employ about 1,000 people and will likely turn over £220 million this year while in our first year, we turned over about £5 million,” Smith says. “We operate through the Channel Tunnel, as far north as Inverness and as far south as you can go in the UK.”

A Flexible Workforce

When it comes to discussing the reason for GB Railfreight’s success, Smith is surprisingly nuts and bolts about how it happened.

“The utilisation of the rolling stock we operate and the people we employ is the key driver to our ability to make a profit. It’s about productivity,” he says. “Our key USP is just the attitude of our people. We endeavour to be inclusive, to communicate with people. We try to be professional about what we do which is a key safety driver. We empower people, but we look after them. When the pubs were open, we celebrated with them.”

The result is a flexible workforce that is committed to GB Railfreight’s mission.

As Smith points out, “We’re not always perfect but it’s something that is a foundation stone of the business and is our unique selling point, the commitment of everyone that works here.”

Of course, building that team in the first place is another matter entirely. GB Railfreight has taken several approaches to recruitment over the years. As it was growing rapidly it was sometimes necessary to hire talent from other rail companies as it couldn’t train people quickly enough.

“That’s settled now, even while the number of people we employ has increased,” Smith says. “We can bring in graduate and undergraduate trainee schemes and apprenticeships. I’m keen to bring young enthusiastic people into the industry. Until Covid, I would have said a job in rail is a job for life, but we’ll see what happens moving forward.”

To nurture young talent in the industry, GB Railfreight has built a bespoke training school into its new offices. It includes simulators and training facilities all geared towards building the momentum necessary to train a generation in the business’s day-to-day operations. But while the tools are state of the art, some things have remained unchanged since the age of steam.

“Quite a few of our new recruits are family and friends of current staff, but I’m all for that,” Smith says. “It’s a traditional way of approaching rail employment. You’ve got to be visible to the staff, talk and communicate and help and support them when their life is difficult. To employ the best staff you can’t just do it and say it’s done. It’s a perpetual journey of engagement.”

A Greener Form of Freight

As well as training the next generation of rail workers, Smith is also working to prepare the industry for the next generation. He believes that a big focus for the rail sector moving forward needs to be sustainability.

“Rail freight is naturally more sustainable than other forms of freight,” he says. “We flog that right down to the statistical details and it’s already underpinning the business as being more carbon-efficient than the road is. Before Covid, the government was moving heavily towards its carbon agenda and they saw rail freight being a key element of that.”

However, Smith believes that the rail sector can do more, but also that it has to do so while making an economic case for a greener form of transport.

“While the sustainability argument is strong, there are still customers driven by price and when it comes to key commodities that might migrate to rail that move is starting to happen, but if it’s not getting a good return that won’t work,” Smith says. “So strategically we have to move with that while also making a stronger case for sustainability. We’ve gone far enough off the fact rail is naturally more sustainable, but we have to move on. That’s about committing to decarbonise assets.”

The issue is that decarbonising rail assets is no small task. With road assets, for example, a company that has purchased a new vehicle will likely sell it after five years and then after ten, that vehicle will go to scrap. In rail transport, on the other hand, it’s not uncommon for assets to have a lifespan in the region of 40 years. This means that when vehicles in the industry change it tends to line up with a major industry shift.

“First there was the switch from steam to diesel, then during the process of privatisation the industry switched from old diesels, introducing the new standard component, a class 66 diesel locomotive,” Smith recalls. “Now there’s a need to take the next step and that underpins what we’re doing at the moment.”

The vehicles on the rails are just a part of this process. GB Railfreight has also just built a new, efficient office in Peterborough.

“It’s built at a level far more sustainable level than our previous accommodation,” says Smith. “It’s nice PR but the prime mover is we need the trains to take the next step.”

To achieve these goals, GB Railfreight needs to continue its growth trajectory.

“We’ve got to continue to grow the business. I’m committed to it,” says Smith. “It’s about following the growth model and getting momentum behind employing another 1,000 people.”

Talking to Smith, however, it’s clear that the thing that’s driving him isn’t just growth or profitability. What shines through our conversation is that Smith has a deep and sincere love of the industry.

“I like railways. A lot of the people here like railways. I like that,” he says. “Railway people, this goes back decades if not centuries, they’re immensely proud and loyal to the industry they operate in. I hope in years to come people will review GB Railfreight as part of railway history. People will look back at this as a success and something that’s added value to the industry as a whole.”

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