Private rail operator making R3.4bn rolling stock investment in 'vote of confidence in SA rail reform'

Private rail operator Traxtion is making a R3.4 billion investment in rolling stock to expand freight capacity and support South Africa's rail reform agenda.

Launching the programme at its Rail Services Hub in Rosslyn, Pretoria, Traxtion hailed it as the biggest known private rail investment in the country's history.

The company operates across 10 African countries, offering full-service rail freight operations.

The local investment is made up of R1.8 billion in locomotives and R1.6 billion in wagons.

Traxtion says the venture entails a minimum 60% local content target and will lead to a projected 662 direct jobs during build and deployment.

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The added capacity provided is expected to address around 5% of the national freight rail capacity shortfall.

It's about unlocking the economic impact that comes with more freight moving by rail, Traxtion said.

In conversation with Motheo Khoaripe (in for Stephen Grootes), CEO James Holley says this investment is a big vote of confidence in South Africa and its rail reform process.

"With this, we're saying that we are happy with the direction of reform, with the policies that have been implemented and the enabling legislation, and we're ready to make an investment off the back of that."

The trains that will be heading to South Africa are being acquired from KiwiRail in New Zealand, who are replacing their Wabtec locomotives with a new generation of low emissions trains.

Traxtion will be working with manufacturer Wabtec on a 'significant' upgrade programme for the locomotives.

"For us to be able to get our hands on not only a large fleet but one that is in very good condition, was an opportunity at a time when we felt we had the confidence to invest in South Africa. This is going to be a fleet with a very high reliability, and with a very high capacity... and one that we can deliver to the industry in a very short period of time and and at a cost-effective price:"

The first locomotives will be available for service within the next 12 months, which is another advantage. Holley says the timeline for the delivery of new locomotives from the time the deposit is paid, is typically double that at 24 months.

Scroll up the audio player to listen to the full conversation