How The New Silk Road Made Freight Trains 'Sexy' Again

13th February 2017

“Rail was something for old, fat people, and with the Silk Road it's becoming sexy and trendy again,” Karl Gheysen succinctly summed up the revolution that the rail freight transport industry is currently going through in Europe and Asia.

Eurasia, as in the contiguous landmass that includes both Europe and Asia, is rapidly being interconnected into a massive market covering 70% of the population, 75% of energy resources, and 70% of GDP in the world, and enhanced rail transport corridors are the strings that are drawing it all together.

The trajectory of Karl Gheysen is the embodiment of this revolution. A career ocean shipping guy who ran logistics for DP World in seaports around the world took on a bold new project in 2014: to build a new port in a place that literally couldn’t be farther from an ocean. Located in proximity to the Eurasian Pole of Inaccessibility on the Kazakhstan/China border, Khorgos Gateway was constructed from scratch to become a massive port for trains rather than ships at the nascent crossroads of Eurasia.

With DP World contracted by the Kazakh government to hold the reigns, everything about the Khorgos dry port was run according to the standards of the global shipping industry, rather than that of rail.

“So we come with our procedures from DP World. We do copy paste. For us, this is like a sea terminal,” Gheysen said. “The software that I use is the same as in a seaport, the procedure is the same as in a seaport. People over here in the CIS countries are going, ‘Wow, a train in 47 minutes in and out, that's fast.’”

This break in convention was necessary for such an international logistics hub which aims to help deliver an overland transport product unlike anything previously available. The culture of the rail industry was rooted in the comfortable old world of impermeable borders and national companies holed up in noncompetitive monopolies.

“Rail people traditionally all over the world are used to working in a monopoly,” Gheysen explained. “You are Kazakhstan, you have Kazakh rail, that belongs to you. Everybody who wants to come on the rail has to beg you, 'Please can I come on your rail?' So in every country — in Europe, in America — rail is used to being a monopoly. That is changing. We come from the shipping world, from DP World. There is competition, competition is big, so we have to go fast. So it is a change of culture in the rail environment.”

This new approach to rail freight transport was sparked by the emergence of China-Europe, trans-Eurasian direct trains that had speed and efficiency at the core of their business models.

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