Paul Smart, Managing DIrector, Freightliner Heavy Haul
It’s a long way from forensic science to heavy haul freight. Paul Smart, now MD of Freightliner Heavy Haul, tells Paul Whiting about finding the formula that turned an emerging company into a success story in just seven years.
When Paul Smart gained a Masters Degree in analytical chemistry, he fully expected his career path to follow suit. And for a while it did.
But after a stint with the Metropolitan Police forensic laboratory as an analytical chemist, he joined an American canning company. And that’s when his intended career path started to change.
The company moved its operations to France and Paul, on the lookout for a new job, swapped the canning industry for the railway industry.
He joined British Rail’s research department, a move which was to set him on a course for general management in the rail freight industry and, ultimately, the top job with Freightliner Heavy Haul.
In April this year he was appointed to the board of Freightliner as managing director of Heavy Haul, one of rail freight’s major success stories of the past seven years.
After its early, small beginnings, in 1999, when it began hauling Railtrack engineering trains, Freightliner Heavy Haul has built up a turnover of more than £90 million.
It employs more than 600 staff to run some 1,200 trains a week, using 79 Class 66s – five more are being built – and more than 800 wagons, specially designed for the businesses they serve. Coal wagons are by far the biggest fleet, with 657 vehicles.
Its reputation is hard won, with a strong concentration on punctuality, reliability, flexibility and customer service. And Paul Smart, who was with parent company Freightliner from the start, has had no small part to play in that hard-won success.
Work he did some years ago as part of an investigation to find out why the Freightliner business was losing ground was invaluable in helping to solve issues which put the company on the right road.
Paul’s involvement with the freight business has its origins in 1980 when he joined BR Research in Muswell Hill, London, which had been looking for a chemist to study the carriage of dangerous goods. Later, British Rail began to examine internal customer relationships in the industry and to allocate costs to businesses.
“I was 100 per cent working for the freight sector so I came and worked in-house for Railfreight Distribution.”
In 1995, with privatisation of the railways looming, Freightliner was separated from RfD and was moving towards a management buyout situation.
“We saw the potential of Freightliner in the deep-sea container business and it was essential to separate it from the rag-bag of services run by RfD at that time. To be honest, we had doubts about the European direction - doubts about running services through the Channel Tunnel. It looked as if it would be difficult to turn a shilling,” says Paul.
Paul was head of safety in the new Freightliner Intermodal set-up but was soon asked by MD David Rutherford to head up a team dedicated to driving up service quality.
“Trains were running half full and people were getting a shoddy service. Containers were not getting to loading bays when people wanted them there.
“There were traffic jams of lorries waiting to pick up late containers and we were just not bringing in revenue.”
Paul’s team produced data and analysis which was scrutinised to see where things were going wrong. Much of it was down to train planning and getting the optimum use out of the train fleet. And therein lay a major issue.
“The fleet of 60 Class 47 locos was on its knees and needed replacing. It was very tired.”
There were also 30 Class 86 electric locomotives and 10 Class 90 locos.
“It was clear we needed a new fleet, but raising the money was difficult as we were an unproven entity.”
One of the ideas to emerge was to create a new class of loco – the Class 57. It was created using a Class 47 body with Class 47 bogies, but containing a new GM power unit and different AC alternators.
“They proved to be pivotal in keeping us in the market on our diesel routes. They were a good interim solution.”
A decision prompted by an economic situation out of the control of Freightliner led to the creation of Freightliner Heavy Haul.
The economies of several countries in the Far East had got into difficulties, prompting a jolt to the deep-sea container business – Freightliner’s one and only source of revenue.
The situation was aggravated by EWS announcing that it was going to build 1,000 intermodal wagons. “They were coming after us,” Paul said.
The decision to create a new company, Heavy Haul, was taken and the fledgling company won its first contract in 1999 – to haul Railtrack engineering trains.
It was a small beginning. Twenty locos were placed at Railtrack’s disposal and work started.
“The value of that contract enabled Heavy Haul to fund a complete build of 20 Class 66 locomotives built by General Motors. It was a vital step – and that contract is still with us today.”
Nowadays Heavy Haul operates more than 100 engineering trains a week for Network Rail, taking ballast, sleepers and other equipment to engineering possession sites all over the country. It also has a contract to run a Network Rail centre in Taunton, Somerset, managing, maintaining and hauling giant, 2,000ft-long High Output Ballast Cleaners.
In 2000, Paul became Freightliner Intermodal’s operations director. Later he became operations director of Heavy Haul and then MD.
As Heavy Haul started to grow, it went after contracts in the coal business. Last year coal haulage rose to 13 million tonnes – about one-third of the tonnage moved by the company.
Paul said: “Back in 2000, electricity generator companies were getting poor service. We now have more than 40 per cent of the electricity supply coal market.”
Since those early days the company has moved into many other sectors – cement, oil, domestic waste and scrap. The company is service-led and aims to create ‘made to measure’ solutions for all of its customers. Often a rail planning and management team is co-located with the customer.
The company now runs 1,200 trains a week on routes all over England, Scotland and Wales. Crewe is still a major hub but train crews sign on for duty at many locations, with the size of the workforce reflecting the level of business. For instance, Dunbar in East Lothian, Scotland, has about six or seven drivers, whilst Ferrybridge in West Yorkshire has about 100.
Heavy Haul drivers are now among the best paid on the network, with a basic rate of about £40,000 a year.
“Most of our guys like the variety of the work and they do get tremendous variety,” said Paul.
Currently, Heavy Haul has 350 drivers and shunting staff out of a total payroll of 650 people.
“We are a fairly flat organisation with a team leader for drivers, area operations managers and an operations director, so there is not a lot of scope for mobility. But we do have people who were shunters and have become drivers.
“Few leave, although some retire and some go to Intermodal. Most of our drivers are in the 30 to 40 age bracket.”
In fact, the company is recruiting for more drivers and expects to have around 400 in 12 months’ time.
In terms of expansion, Heavy Haul is looking to grow the flourishing aggregates market. Already weekly aggregate flow is around 100,000 tonnes and growth shows no signs of stopping.
“The south east of England now has more construction business than there is in the whole of Europe – and the Olympics will add to that. This is a very good time to win contracts,” said Paul.
The future for Heavy Haul is looking rosy. The company is opening up an operation in Poland and has its eyes on similar operations elsewhere in Europe.
“The Heavy Haul model is working very well in this country and our people think this would be very successful in other countries.”
“We are seeing tremendous growth in bulk rail freight. Coal used to be an eight to 10-mile haul from pit to power station, now it comes 250 miles from Scotland to power stations in Yorkshire via the Settle and Carlisle line. Tonne mileage has soared and we have benefited strongly from that.”
Passion is not a word usually associated with the macho world of bulk train haulage. But Paul Smart is unapologetic in using it.
“I love this job. Freightliner is quite an addictive company and I love this business with a passion.”