RUM comes up with own plan for KTMB

The Railwaymen's Union of Malaya has come up with its own business model to prevent the Malaysian Mining Corporation's plan to takeover Kereta Api Tanah Melayu Berhad.

KUALA LUMPUR: The Railwaymen’s Union of Malaya (RUM), which is against Malaysian Mining Corporation’s (MMC) plan to takeover Kereta Api Tanah Melayu Berhad (KTMB), has come up with its own business model to do so.

The union believes that MMC cannot give any benefit to KTMB workers or the public.

“There is no guarantee that MMC will take care of our interests,” said RUM president Abdul Razak Md Hassan at a press conference today.

“We do not want to be seen as a union which can only ask for things from the government. Therefore, we have come up with a new business model,” he said.

Razak added that the new business model called the “multiple operators” would be more inclined to the cargo transportation business.

He said the proposal would be submitted to the Finance Ministry, Economic Planning Unit, Transport Ministry and Land Public Transport Commission (SPAD) to be considered to ensure KTMB increased its revenue.

“With the completion of the Seremban-Gemas and Ipoh-Padang Besar double-tracking projects next year, KTMB faces a major problem of insufficient rolling stock to accommodate the passenger and cargo train services. KTMB needs to generate revenue to bear increasing operating costs.

“KTMB is expected to bear huge losses in the years to come if the new business model is not introduced,” said Razak.

He stressed that any expenses related to the infrastructure and rolling stock should be shouldered by the government while operating costs should be met by KTMB, adding that buying and maintenance costs of the passenger trains should be borne by the government.

“If there is additional operating costs, KTMB can claim it from the government and this should be based on agreement by both the government and operator.

“We should allow trains from other countries like Thailand, Vietnam and Laos to enter KTMB’s network,” he said, stressing that KTMB can generate additional revenue through route rental to other operators, similar to the concept of collecting tolls on highways.

The RUM president added that the government just needed to provide the infrastructure and a minimal amount of rolling stock for KTMB in time of emergency.

“This concept has been used by the British and Indian railways and the results have been positive. In this way, too, KTMB’s income will multiply and its operating costs will lessen.

“It is also possible that if the model were to be continued, KTMB will act as a precursor to other operators to give services up until China as a form of ‘long train’, similar to that of in America, Canada and India,” he said.

In terms of the cargo train model, Razak said KTMB could multiply its revenue when the Seremban-Gemas and Ipoh-Padang Besar double-tracking projects are completed by providing sufficient rolling stock for cargo transportation.

“KTMB has the potential to increase its revenue through the cargo service by using existing rolling stock and proposing other operators to provide their own to increase the number of cargo trains with the completion of the new infrastructure,” he said.

“If MMC wants to do business it can instead become one of the operators. Its proposal to invest RM1 billion is insufficient because we need at least RM15 billion to reinvent KTMB,” he said.

Razak also admitted that the cargo transportation done by KTMB thus far has only utilised 2% to 5% of the entire load in Malaysia.

“The increase in the number of operators will ensure more than 30% of the services is used. It is also not even impossible that with an effective business strategy, we can achieve up to 50% of services using cargo rails,” he said.

Razak added that the union would send a memorandum on the new business plan to all parties involved for consideration and henceforth return KTMB back to the public sector.

“If the government can implement this plan, not only the workers, but everyone will benefit from it,” he said.