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Spoornet's restructuring on track
PARASTATALS
THE restructuring of Spoornet, proposed only a month ago, is already up and running and should, in time, produce the profits that could make the rail transporter an ideal privatisation vehicle. Spoornet chief executive Braam le Roux has made major changes to the division's structure by cutting out 10 regional management branches, adding new business units, creating a new marketing department and centralising control through a freight reservation system. "This year we will show a bigger profit than the R98-million (R734-million) last year and I am looking for a very good year in the following 12 months. Our transition, which has been a major change for us and has involved people adjusting to the new framework, is working well, although it has happened a little slower than I would have hoped." Suggestions that Spoornet will be privatised in the near future, however, are way off the mark: "Spoornet does not generate sufficient profits for it to be a 'good sell'. We have to make it much more profitable and this will take time. At present, the privatisation of Spoornet is part of Transnet's plan. "There are many other divisions such as Sun Air, Metro Rail or Autonet that would be ahead of Spoornet for privatisation," says Le Roux. Spoornet will, however, form joint ventures or alliances with strategic partners. It is also involved in a joint venture with a Belgian rail company and has a controlling interest in the Zairean railway. The change within Spoornet's operating structure has promoted it to perhaps one of the most efficient rail networks in the world, says Le Roux. "Sweden operates a similar freight reservation plan, but we had to develop the necessary software ourselves. The reservation system operates on a basis similar to an airline booking with everything negotiated before the contract begins." Changes to Spoornet were necessary because of the increasing challenge from road traffic. Rail now has to compete with road hauliers who are able to operate trucks of up to 40 tons. This compares with European and American rail lines that have only 18-to 22-ton trucks as competition. The freight reservation system now allows Spoornet to plan all transport operations from a dedicated centre and concentrate on 20 business units which look after industries such as coal, iron ore and pulp and paper. Metro Rail, with its 11 000 employees, will be hived off to Transnet. The new-look Spoornet has also opened up new affirmative action possibilities. The relationship between Le Roux and Mafika Mkwanazi, recently appointed Transnet director in charge of Spoornet, has been a success. The changed Spoornet, though, will not require the same staff as in the past, but Le Roux says there are no immediate plans for significant retrenchments.
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