European Railroad Discussion > Want to buy a railfreight company?

Reuters and Wall Street Journal are reporting that the Middle Eastern owners of Freightliner Group have put it up for sale. Asking price about £400m ($640m).

Interesting! Another company for sale...

Is there an obvious reason for this sale or are the owners just tired of doing railroading?

Picture by you at Craven Arms.

---

The owners aren't really railroaders, they are an Atlanta based Bahraini investment fund, I guess their portfolio is constantly changing. WSJ suggests that changes in coastal shipping carbon permits may increase the value of railfreight companies, maybe Arcapita are taking advantage of a potential price premium.

Should I read this that you too in U.K. are victims of the extra EU tax on sea faring ships? I thought this directive was only made to severely punish the companies operating in Nordic and Baltic countries...

86235 Wrote:
-------------------------------------------------------
> The owners aren't really railroaders, they are an
> Atlanta based Bahraini investment fund, I guess
> their portfolio is constantly changing. WSJ
> suggests that changes in coastal shipping carbon
> permits may increase the value of railfreight
> companies, maybe Arcapita are taking advantage of
> a potential price premium.

---

I think the carbon surcharge is EU wide, certainly cross channel shipping is impacted if DFDS and Stena are to be believed. In any case Freightliner have operations in Poland, Germany and the Netherlands so are in a position to benefit.

McKey Wrote:
-------------------------------------------------------
> Should I read this that you too in U.K. are
> victims of the extra EU tax on sea faring ships? I
> thought this directive was only made to severely
> punish the companies operating in Nordic and
> Baltic countries...
>
I don't want to sound rude, but I think your language is bit simplistic and childish. Taxes have both beneficiaries as well as "victims' - the question is always does one outweigh the other. As for the purpose of the directive being to "punish" the companies, any price or cost may be regarded as a punishment, in that it is an unpleasant consequence of consuming something.

It is a time-honoured principle underlying market economics that purchasers should face the resource implications of their actions, ie "the polluter pays". If you wish to take up the question of whether CO2 emissions have an impact on others, then by all means do so, (although you would be challenging a global expert scientific consensus). However, it is not unreasonable that the EU or any other government should respect such opinions, and if they do it follows that they have a clear responsibility to attempt to alter consumption behaviours in transportation as elsewhere.

Even worse would be to deny the facts because one doesn't like the consequences - this is the same as the child who runs around with her fingers stuck in her ears at bedtime!



Edited 1 time(s). Last edit at 11/13/14 09:23 by spflow.

Well, how do you then put that Northern Europe is paying this new punishment but Southern Europe is not? This new quite high tax is _not_ European wide and I'm quite surprised that always well against EU campaigning British people are left to the same leaking boat with the Northern nations, they all have higher production costs after this substantial addition to taxation.

A very simple question to you spflow: do you believe that economical activity goes where the operating costs are lower, not where the costs are rising? Do you believe that people living in certain area benefit from the increased economic activity? Do you understand that this move will drive unemployment even higher in these nations that already pay much of the EU taxes?

From many places there is NO way besides ships and/or lots of additional trucks to reach the markets. I care about how the people of Nordic nations and UK are doing.

spflow Wrote:
-------------------------------------------------------
> McKey Wrote:
> --------------------------------------------------
> -----
> > Should I read this that you too in U.K. are
> > victims of the extra EU tax on sea faring ships?
> I
> > thought this directive was only made to
> severely
> > punish the companies operating in Nordic and
> > Baltic countries...
> >
> I don't want to sound rude, but I think your
> language is bit simplistic and childish. Taxes
> have both beneficiaries as well as "victims' - the
> question is always does one outweigh the other. As
> for the purpose of the directive being to "punish"
> the companies, any price or cost may be regarded
> as a punishment, in that it is an unpleasant
> consequence of consuming something.
>
> It is a time-honoured principle underlying market
> economics that purchasers should face the resource
> implications of their actions, ie "the polluter
> pays". If you wish to take up the question of
> whether CO2 emissions have an impact on others,
> then by all means do so, (although you would be
> challenging a global expert scientific consensus).
> However, it is not unreasonable that the EU or any
> other government should respect such opinions, and
> if they do it follows that they have a clear
> responsibility to attempt to alter consumption
> behaviours in transportation as elsewhere.
>
> Even worse would be to deny the facts because one
> doesn't like the consequences - this is the same
> as the child who runs around with her fingers
> stuck in her ears at bedtime!

---

Why so many ships? All these will have to change their fuel to much more expensive or face the dramatically increased taxation.

---

spflow Wrote:
-------------------------------------------------------
> McKey Wrote:
> --------------------------------------------------
> -----
> > Should I read this that you too in U.K. are
> > victims of the extra EU tax on sea faring ships?
> I
> > thought this directive was only made to
> severely
> > punish the companies operating in Nordic and
> > Baltic countries...
> >
> I don't want to sound rude, but I think your
> language is bit simplistic and childish. Taxes
> have both beneficiaries as well as "victims' - the
> question is always does one outweigh the other. As
> for the purpose of the directive being to "punish"
> the companies, any price or cost may be regarded
> as a punishment, in that it is an unpleasant
> consequence of consuming something.
>
> It is a time-honoured principle underlying market
> economics that purchasers should face the resource
> implications of their actions, ie "the polluter
> pays". If you wish to take up the question of
> whether CO2 emissions have an impact on others,
> then by all means do so, (although you would be
> challenging a global expert scientific consensus).
> However, it is not unreasonable that the EU or any
> other government should respect such opinions, and
> if they do it follows that they have a clear
> responsibility to attempt to alter consumption
> behaviours in transportation as elsewhere.
>
> Even worse would be to deny the facts because one
> doesn't like the consequences - this is the same
> as the child who runs around with her fingers
> stuck in her ears at bedtime!


Ironic post is ironic.

I particularly like the 'Settled Science!' copout attempt to squelch dissenting opinions (and that's what yours are, too, opinions) given how your 'truths' are still just theories. Theories based in large part on faulty E. Anglia base data (now with the admission that it was manipulated for political ideological reasons) and computer modeling that has proven to have a less than stellar prediction record as time has played out. But surely the models are correct now....

I agree that one can only have opinions - and nothing is proven beyond all reasonable doubt (or ever will be). My main point is that taxation is never automatically wholly bad because it always by definition represents a transfer of spending power from one group to another, and that it all depends on your values and opinions whether the result is good or bad. I do not know how selective EU carbon taxes are between north and south, my gut feeling is that if the south are avoiding imposition of such tax then they should be made to do so rather than discredit the concept because of an unfair (or inefficient) application

As to the CO2 issue, again there are two distinct questions:

1. Is there any chance that climate change might be associated with an increase in emitted CO2?

2. What risk of this being the case we are prepared to contemplate before we make any efforts to reduce emissions?

The science on climate change is clearly not 100% definite - I know of no field in which one can say that. Thus all judgements over policy have to be made on best guesses, and values of the possible outcomes. If there was a 5% chance that increasing carbon emissions might lead to irrevocable climate change, I personally would judge that it was worth playing safe and forgoing the consumption. However, this is my personal value - others might feel that they could not contemplate foregoing any material comfort for the benefit of future generations, regardless of the evidence.

Many public risks are exceedingly well avoided: eg we impose speed limits because of the chance that a higher speed might cause some harm. Few of us would allow an infant to cross a busy highway in spite of a less than certain chance that they would be hit. We do not wait until there is absolute certainty of injury. It is well recognised cliche in Europe that Americans seem to be very anxious about certain small risks eg Ebola, while living with much larger risks eg domestic homicide rates.

I am not trying to be morally superior, simply to comment that all these issues depend upon values as to what constitutes a good society, which are distinct from opinions on the status of physical relationships.

Its quite amazing how the initial submission and start to this thread was about Freightliner (UK) being put up for sale and it became hijacked into a thread about ships, emissions and pollution. Scary!
Keith G, London UK

CIT1023 Wrote:
-------------------------------------------------------
> Its quite amazing how the initial submission and
> start to this thread was about Freightliner (UK)
> being put up for sale and it became hijacked into
> a thread about ships, emissions and pollution.
> Scary!
> Keith G, London UK


Well said! I apologise if I got carried away - it's just that none of these changes (eg the sale of Freightliner) can be considered without some politics getting involved.

I'll try and keep a lid on it in future!

No problem "spflow" long may we have the freedom to be able to debate the issues whatever they may be.
Keith G, London, Uk

I think it more likely that Arcapita is selling Freightliner due to generally poor economic conditions for railway companies in Europe, and the prospect that they will continue for some time. Most companies like Arcapita have much shorter investing horizons and expect a quicker return on their investment. Arcapita bought Freightliner in 2008 right before the recession really took hold.



Edited 1 time(s). Last edit at 11/14/14 12:07 by SOO6617.