Pre-feasibility study for the construction of a container terminal in Konin and its linking to the FLAVIA corridor

Transcription

1 East Europe - Validation of trade and transport processes, Implementation of improvement actions, Application WP 5 Pre-feasibility studies to support intermodal rail Report Action 5.2 Pre-feasibility study for the construction of a container terminal in Konin and its linking to the FLAVIA corridor Date: Public document Version: final

2 Involved FLAVIA partners: Institute of Logistics and Warehousing, Wiktor Żuchowski, PL The information in this document is provided as is, and no guarantee or warranty is given that the information is fit for any particular purpose. The user thereof uses the information at its own risk and is solely liable for its usage

3 Content: 1 Executive Summary Introduction Scope of the study Aim of the study Concept of the project The area of the project influence Market and competition situation Market profile Economical potential of the region Dynamics of the basic economic indexes Volume and structure of material flow in the region Volume and structure of material flow for the project Market players Characteristic of the potential suppliers of the services Characteristic of the potential recipients of the services Competition Characteristics of the existing terminals Operators providing intermodal services in connection Poland FLAVIA South Evaluation of the indicated project localization Characteristics of the properties Assignment of the properties Infrastructural resources Possible direction of the extension Transport condition Strategy of the pre-feasibility study Offered services SWOT indication General Business Model Organizational assumptions Preliminary concept of terminal development Estimated financial needs Added value of the product Operation Necessary supplier and cooperating companies

4 6.2 Assets and capacities to be used Service Launch Plan Stages of the implementation Schedule of the project realization Business Development Forecast of the basic economic indexes changes Customer structure and possible changes Forecasted of the changes in material flow Indicators of the implementation Number of jobs to be created through investment Amount of the transport volume of the new services Financial evaluation of the project Financial assumption of the project Estimated outlays, incomes and operational cost of the project Analysis of financial performance Contribution to the FLAVIA Goals Strengthening territorial cohesion Promoting internal integration Enhancing the competitiveness Linking of the terminal to the FLAVIA corridor Conclusions Lessons learned during the implementation of the pre-feasibility study

5 1 Executive Summary The Study represents a preliminary feasibility study for the construction of a container terminal in Konin. The study encompasses such aspects as, for example, assessment of location, forecast of expected freight flows via planned terminal, estimated investment outlays and financial assessment of the project. The economic potential of the analyzed impact area of the container terminal and the resulting flow of goods which can be handled in a containerization-based system are good arguments justifying the construction of a container terminal in Konin. The terminal can be important part in the Polish logistics network, though its location and competition status restrict its role to that of a local container transhipment point. A definite advantage of Konin as a location for a container terminal is still developing road transport infrastructure. Infrastructural facilities in the immediate vicinity of the planned project ensure all the utilities required for smooth terminal operation. Once built, the terminal will not virtually have any potential for expansion, however its planned capacity seems perfectly adequate for flows forecasted till The return on investment (ROI) was estimated at over twenty years. The construction of the planned container terminal in Konin is an economically viable long-term undertaking. It is also a great development opportunity for the town and region since the terminal may attract new business to the industrial zone in Żdżary, to the logistics centre in Modła Królewska and to existing industrial and post-industrial areas in Konin and Kalisz as well as other towns and municipalities situated in the Konin/Kalisz subregion. It is hoped that the terminal will bring enterprises which make a large use of rail transport (production automotive industry, home appliances, audio/video equipment, electronics and engineering, etc.; distribution furniture, home appliances, audio/video equipment, etc.; building materials). Despite some FLAVIA South countries are direct neighbours of Poland the trade exchange is stronger in east-west axis. The share of the potential intermodal transport between FLAVIA South countries and the impact area of the Konin Terminal in whole local intermodal transport is estimated on the level of 13%. Nevertheless more than one tenth of potential transport will be directed in considered direction with strong stress on Czech Republic, which means that FLAVIA South countries will be possibly important players on Konin Terminal market. Finally on the horizon of the forecast (year 2031) the turnover between FLAVIA South and Konin Terminal influence area should exceed 70 thousand tons, which means approximately one full train of 30 containers in both directions every week

6 2 Introduction 2.1 Scope of the study The Study was developed within the framework of the WP 5 task Pre-feasibility studies to support intermodal rail under the EU project on Freight and Logistics Advancement in Central Europe Validation of processes, Improvements, Application of Co-operation. The Study is concerned with the construction of a terminal in Konin (Konin Terminal) and possible future connection(s) between the planned terminal and five FLAVIA South countries, i.e. Austria, the Czech Republic, Hungary, Romania and Slovakia. 2.2 Aim of the study The aim of the Study is to assess benefits entailed in the organization of a rail terminal in Konin, taking into account possibilities for the development of container transport by rail from Poland to other Central and Eastern European countries (the Czech Republic, Slovakia, Austria, Hungary and Romania). Results of the project will make it possible to accurately assess the undertaking, facilitate its promotion and future implementation. 2.3 Concept of the project The planned container terminal location is along the route of the 2 nd European transport corridor of the Trans-European Transport Network (TEN-T) which in the Polish territory includes the E20 rail line (C-E20) and the A2 motorway (Figure 2-1). A definite benefit of the terminal will be its close proximity to the rail/road infrastructure of the 6 th European transport corridor. The terminal s convenient connection to the main transport nodes of both transport corridors creates opportunities for the expansion of intermodal transport both in the East-West and North- South directions. The terminal in Konin, in view of its location and competitive status, will serve as a local container transhipment facility addressing the needs of businesses operating within the project s assumed impact area. Due to the same reasons the terminal s potential to become one of major transhipment centres for transit freight is considerably limited

7 Konin Figure 2-1 Localization of the terminal on the background of European transport corridors Source: Prepared by ILiM based on drawing of Ministry of Infrastructure 2.4 The area of the project influence The impact area of the container terminal in Konin on the economic surroundings was assumed as half of the distance from the nearest container terminals which were considered competitive for the planned undertaking. The assumption is based on the practical operation of container terminals in Europe which shows that container transport between cooperating terminals is effective, both time and cost wise, if the distance between them is at least 300 km. What is more, effectiveness increases in parallel to the distance. Consequently, container terminals located at a smaller distance should be regarded as potentially competitive for the planned location. However, considering the fact that the share of container transport in Poland s internal transport relations is still quite small, an additional assumption needs to be made, namely that the competition will emerge rather in regular container transport between Polish terminals and foreign terminals cooperating with them. As a result, it was assumed that Konin s competitive terminals were located at a shorter distance from the arbitrary radius marking the distance of container transport by road to the terminal. An analysis of Europe s existing container terminals shows that the distance should not exceed km. With this assumption, Konin s competitive terminals are located at a distance between 100 and 140 km from Konin, because a company based half way through the distance has a choice between two different terminals for the shipment of goods (Figure 2-2). The circles shown in Figure 2-2 are, naturally, arbitrary because the actual shape of the project s impact area is also affected by other factors such as the actual distance of the nearest terminal in a given direction, or the availability and quality of transport infrastructure which can be used for accessing the terminal, etc

8 The area within a 100 km radius from Konin has the following container handling infrastructure: to the west three container terminals (Kobylnica, Gądki and Swarzędz near Poznań), to the east two container terminals (Kutno and Łódź). Based on the above-mentioned impact zones for the container terminals, the following impact areas were adopted for the Konin container terminal: primary impact area: Konin town and Konin district, Kalisz town and Kalisz district, districts: słupecki, turecki, wrzesiński. secondary impact area: districts: gnieźnieński, jarociński, kolski, ostrowski, wrzesiński, mogileński and radziejowski. Figure 2-2 Existing terminals around planned investment Source: Prepared by ILiM - 8 -

9 3 Market and competition situation Identification of lacks in existing intermodal services The intermodal services in connection Poland FLAVIA South do not really exist. The first steps have been taken, but still sequential connection has not been identified. The flow from Poland in South direction, even including harbours of Adriatic Sea, is not significant as in other directions, because main trade partners of Poland are situated on east-west line. However there are some plans of the existing operators to connect Polish and FLAVIA South terminals. Intermodal services in South direction are maiden ground. Lack of services opens wide perspective for entrepreneurs and their organizations. Growing economies and trade exchange will be a titbit for foreseeing companies soon. 3.1 Market profile Economical potential of the region The analysis of the economic potential existing in the impact area of the planned project was based on data supplied by the Central Statistical Office (GUS) for those elements of the economy which significantly affect its potential both in terms of supply (production of finished products) and demand (for raw materials, intermediates and finished products). The analysis incorporated the following factors: population size, number of enterprises, volume of the industry s sold production, investment outlays made by enterprises, income of the working population. Indicators defining the potential of the impact area of the planned terminal were assumed as: 100% for the primary impact area, 50% for the secondary impact area. The differences in economic potential parameters which have a significant effect on the potential demand for terminal services are listed in Table

10 Table 3-1 Comparison of economic potential in the impact area of the container terminal in Konin which has an impact on its operations Source: ILiM, based on data from the Inland Revenue Offices in Poznań, Bydgoszcz and Łódź. Property Unit of measure Province kujawskopomorskie wielkopolskie Impact area primary secondary Total Industry s sold production which can be containerized a million PLN 6 892, , , ,5 Share of sold production which can be containerized b % 72,1% 72,1% 89,7% 78,0% Investment outlays in enterprises a million PLN 1 015,9 449,3 265, ,8 Number of business entities a Investment outlays per one enterprise thousand PLN 21,6 18,5 26,5 21,3 Income of the working population c million PLN 5 659, , , ,9 a Data apply to business entities with a number of employees exceeding 9. b Converted with a dedicated indicator to eliminate those sectors of the industry which produce goods that cannot be handled in containers (using ILiM s own expert method). c On the basis of actual place of work; excluding business entities employing fewer than 9 workers; excluding personnel of state administration entities operating in national security and public safety sectors; including workers of individual (private) farms. There are over 81 thousand business entities in the container terminal s assumed impact area. A mean percentage of palletization-compatible production of goods sold by the enterprises is 78%. The purchasing power of the local community measured with the annual income of the working population exceeds PLN million, which represents over 79% of the value of industry s sold production which can be containerized. The data demonstrate a marked potential of the area with regard to the potential generation of stream of container loads. In order to assess the volume of streams of unitized loads which can be containerized within the planned project s impact area, ILiM s own expert method was applied. The method is based on determination of indicators representing the shares of selected areas in the overall transport activity recorded in individual provinces. The values of the indicators were determined as a weighted mean of the potential existing in the area under analysis in relation to the whole province

11 For the purpose of the analysis, the following weights were adopted for the criteria listed below: industry s sold production which can be containerized weight 1.0; investment outlays in enterprises weight 0.1; number of business entities weight 0.3; income of the working population weight 1.0. Results of estimates are listed in Table 3-2. Table 3-2 Indicators representing the shares of transport in the project s impact area in the total transport activity in individual provinces Source: ILiM, based on data from the Central Statistical Office (GUS) Transport Results 2009 Province Share of transport for the designated impact area kujawsko-pomorskie 5,9% wielkopolskie 18,6% Another factor increasing the chances of success of the planned project is Poland s distinctive strong correlation between the size of modern warehouse facilities in individual regions of the country and the quality of road transport infrastructure which ensures efficient supply of customers with goods for production and commercial purposes from stock storage locations. The demand for modern warehouse facilities has been growing steadily, as shown by the nearly 5% decrease in the volume of vacant warehouses compared to In the first quarter of 2011, warehouse vacancies in the Wielkopolska region were estimated at 7.1% and in central Poland 13.8%. A significant factor for the location of new warehouse facilities is the availability of workers and the associated costs of labour. The gradual depletion of labour resources in regions traditionally perceived as more attractive than Konin (urban agglomerations of Poznań and Łódź, area around Piotrków Trybunalski and Mszczonów) will, inevitably, shift the investors interest to regions where the labour market has not been drained yet. Therefore, it seems a viable scenario that freight from quite distant markets will be delivered, via intermodal transport, to warehouses located around Konin (Modła Królewska, Żdzary, Konin, Kalisz, etc.), so that they can be further distributed by road transport by logistics operators to customers within the terminal s impact area or even beyond

12 3.1.2 Dynamics of the basic economic indexes The dynamics of changes in basic economic indicators for the planned project s impact area was assessed on the basis of: identified values of selected economic parameters for different provinces in the period ; percentage share of values of selected parameters for the primary and secondary impact areas in relation to the province as a whole, in Results of respective analyses are presented in: Table 3-3 estimated values of basic economic indicators for the assumed impact area of the project in , Figure 3-1 dynamics of changes of basic economic indicators in subsequent years relative to the 2000 baseline. Table 3-3 Basic economic indicators for the terminal s impact area in Source: ILiM, based on data from the Inland Revenue Offices in Poznań, Bydgoszcz and Łódź Year Population National economy entities a Industry s sold production a Income of the working population b Investment outlays a [in thousand] [in thousand] [in million PLN] [in million PLN] [in million PLN] ,5 67, , , , ,4 78, , , , ,9 78, , , , ,0 80, , , , ,8 82, , , , ,6 81, , , ,8 a Data for business entities employing more than 9 staff members. b On the basis of actual place of work; excluding business entities employing fewer than 9 workers; excluding personnel of state administration entities operating in national security and public safety sectors; including workers of individual (private) farms

13 90,0% 80,0% 70,0% 60,0% 50,0% 40,0% 30,0% 20,0% 10,0% 0,0% -10,0% -20,0% Population National economy entities Industry s sold production Income of the working population Investment outlays Figure 3-1 Dynamics of basic economic indicators for the terminal s impact area Source: ILiM, based on data from the Central Statistical Office (GUS) Transport Results 2009 The marked fall in the dynamics of the industry s sold production, illustrated in Figure 3-1, is indicative of a gradual decline in the manufacturing (production) potential in the impact area of the planned terminal. Another important sign of deepening economic slowdown in the region is the observed substantial fall in investment outlays made by enterprises, coupled with a decrease in the number of business entities entered in the REGON register. However, despite the risks, growth indicators forecast by the World Bank for Poland are still more favourable than other EU economies. April 2011 data estimate GDP growth rates at 4.0% in 2011 and 4.2% in Results of these analyses were taken into account in the forecast of intermodal transport growth, both for rail and road transport modes Volume and structure of material flow in the region The analysis of volume and structure of freight transport within the impact area of the planned project plays is key to determining the magnitude and range of services to be provided by the rail container terminal in Konin, and the type and scope of infrastructure necessary to deliver the services. Essential factors for ensuring appropriate loads to be handled at the planned terminal include rail and road transport which, according to 2010 data, accounted for 96.2% of the total transported weight of loads

14 Dynamics of the freight transport [%] Freight and Logistics Advancement in Central/South- The analysis of dynamics of freight transport in Poland (presented in Table 3-4 and Figure 3-2) reveals a major increase in the volume of loads carried by rail in 2010, as compared to the relatively poor result recorded in In spite of that growth, a slight fall (2%) in the weight of freight transported by rail was noted in As for road transport, a steady growth trend is seen despite a slight decline in dynamics which, over the past five years, was 7.6% on average. As opposed to rail transport, the share of containers in road transport fell by ca. 25% in comparison to Results of analyses were included in the adopted forecast of intermodal transport growth. Table 3-4 Volumes and structure of freight transport in Poland in Source: ILiM, based on data from the Central Statistical Office (GUS) Transport Results 2010 Transport type Transport of loads [in thousand tons] Share in 2010 Rail ,8% Road ,4% Sea ,4% Air ,0% Pipelines ,1% Inland waterways ,3% TOTAL ,0% 140,0% 120,0% 100,0% 80,0% 60,0% 40,0% 20,0% 0,0% total freight rail freight road freight Year Figure 3-2 Dynamics of the freight transport for selected transport types in Poland in Source: ILiM, based on data from the Central Statistical Office (GUS) Transport Results

15 The goods exchange between Poland and FLAVIA South countries in 2010 is shown on Błąd! Nie można odnaleźć źródła odwołania.table 3-5. Table 3-5 Goods exchange between Poland and FLAVIA in 2010 (million tons) Source: ILiM, based on data from the Central Statistical Office (GUS) Transport Results 2010 FROM POLAND Road Railway Intermodal approx. Czech Republic 3,72 2,94 0,059 Slovakia 2,10 1,54 0,031 Austria 1,18 1,99 0,040 Hungary 1,24 0,33 0,007 Romania 0,61 0,51 0,010 FLAVIA SOUTH 8,85 7,31 0,146 TO POLAND Road Railway Intermodal approx. Czech Republic 3,63 3,18 0,064 Slovakia 2,10 1,35 0,027 Austria 1,06 0,10 0,002 Hungary 1,35 0,16 0,003 Romania 0,33 0,10 0,002 FLAVIA SOUTH 8,46 4,90 0,098 The highest road flow (in the scope of the interest) was identified between Poland and Czech Republic. The trade exchange on the roads between these countries presents 42% of the whole FLAVIA South flow. On the second place Slovakia was classified. Connections between former Czechoslovakia stands for nearly 65% of FLAVIA South stream from/to Poland. Actually the intermodal transport shares approximately 4,2% in whole Polish railway transport of goods (4,6% export, 4,0% import). In considered direction, because of lack of regular intermodal services, the share has to be reduced. It can be approximated that actually intermodal services between Poland and FLAVIA South covers less than 2% of the railway transport. In view of the assumed functionality of the planned terminal and its transport features, further analyses focus on the rail and road transport of containerized loads covering exclusively the impact area of the planned project defined in subsection 2.4. Transport volumes for the designated area were determined using percentage indicators representing the share of the impact area in the total transport in the province, as shown in Table 3-2. The analysis of freight transport encompassed: domestic transport (including movement of goods between provinces), international transport (exports and imports in the province)

16 3.1.4 Volume and structure of material flow for the project Rail transport (2010) The main foundation for determining the potential freight flow in rail transport for the planned terminal was the structure of freight transport for selected provinces. Due to the absence of detailed data, transport volumes were assessed on the basis of: the province s transport balance for 2005; the dynamics of changes noted in domestic rail transport by directions in Results of calculations are listed in Table 3-6. Table 3-6 Volumes of freight transported by rail in the province in 2010 Source: ILiM, based on data from the Central Statistical Office (GUS) Transport Results 2010 Province kujawsko -pomorskie total Freight transport in 2010 [in thousand tons] Outgoing freight Incoming freight Freight turnover domestic exports / Flavia South total domestic import / Flavia South total domestic export -import / Flavia South / / / 205 wielkopolskie / / / 250 Total / / / 455 The share of intermodal transport in rail transport was determined on the basis of statistical data for the structure of container transport by standard gauge rail in 2010 (Table 3-7). Table 3-7 Transport of container loads by rail in 2010 Source: ILiM, based on data from the Central Statistical Office (GUS) Transport Results 2010 Specification Transport of the container loads by rail [in thousand tons] Share in total transport Total ,0% - in domestic transport 847 0,4% - in international transport, including Flavia south The volume of container transport by rail for the planned terminal was estimated on the basis of data listed below: 1,6% volumes of freight transported by rail in the provinces (Table 3-6), calculated indicators of the shares of different regions in the total transport in selected provinces (Table 3-2), share of container transport in the total rail transport (Table 3-7). Results of the estimation are presented in Table

17 Table 3-8 Estimated volume of container transport by rail for the planned terminal in 2010 Source: ILiM Specification Unit of measurement Volume Outgoing ton domestic ton exports - Including Flavia South ton Incoming ton domestic ton imports - Including Flavia South ton Total turnover ton domestic ton international - Including Flavia South ton Road transport (2010) The potential flow of goods in road transport for the planned terminal was determined on the basis of volumes and structure of freight transport in selected provinces, as listed in Table 3-9. Table 3-9 Balance of freight transport by road in selected provinces in 2010 Source: ILiM, based on data from the Central Statistical Office (GUS) Transport Results 2010 Province Kujawsko -pomorskie total Freight transport in 2010 [in thousand tons] Outgoing freight Incoming freight Freight turnover domestic exports / Flavia South total domestic import / Flavia South total domestic export -import / Flavia South / / / 864 wielkopolskie / / / Total / / / The volume of container transport by road for the planned terminal was estimated on the basis of data listed below: volumes of freight transported by road in selected provinces (Table 3-9), share of container transport (on average 1,6% of the total transport) (Table 3-10), value of the indicator representing domestic road to rail container transport substitution, adopted on the basis of financial simulations and amounting to: o for domestic transport 10%,

18 o for international transport 75%, calculated indicators of the share of the impact area in the province s total transport (Table 3-2). Results are listed in Table Table 3-10 Estimated volume of container transport by road for the planned terminal in 2010 Source: ILiM Specification Unit of measurement Volume Outgoing Ton domestic Ton exports Ton Including Flavia South Incoming Ton domestic Ton imports Ton Including Flavia South Total turnover Ton domestic Ton international - Including Flavia South Ton Forecast of the intermodal transport for the project In order to analyze intermodal transport for the planned rail container terminal, the following activities were performed: to assess what kind of terminal infrastructure is necessary, the volume of forecast intermodal transport in was determined, to establish what preliminary assumptions, in terms of technology and organization, need to be adopted for terminal operation, the structure of intermodal transport was analyzed. The construction of a container terminal is a major undertaking which requires an extensive area and considerable financial resources to ensure its launch and initial operation. Consequently, the project needs to take account of the fact that basic parameters determining the terminal s efficient operation change in time. The analysis of intermodal transport volumes in the container terminal s impact area must, therefore, incorporate forecast changes in the flows of goods. In view of expected ROI periods, forecasts prepared for such capital-intensive projects should span a period of years. Because of the dominant status of international intermodal transport, the forecast for the growth of freight turnover in the planned terminal was prepared taking into account the current economic recession in Europe. The forecast was made for the period , with 2010 as the baseline, which was motivated by the availability of all data necessary for assessing the magnitude of the flow of goods in the terminal

19 The main resource used for estimating the terminal s freight turnover was the forecast for combined/intermodal transport in Poland for developed by prof. Jerzy Wronka, PhD (hab.), described in the study on Intermodal logistics network in Poland a concept of model solutions and implementation-related factors [1], which is presented in Table Table 3-11 Forecast combined/intermodal transport activity (in million tons) Source: ILiM based on [1] Variants Dynamics Maximum 2,7 5,7 7,9 15,9 31,8 11,8 Minimum 2,7 4,1 6,8 12,3 23,3 8,6 On account of the current economic slowdown, further analysed were carried out for the minimum (cautious) variant. For the purpose of the project the variant was reconciled to annual values assuming a constant growth factor in consecutive periods of analysis. Based on those assumptions, intermodal transport volumes were assessed for the planned terminal for the period until Forecast data are listed in Table Table 3-12 Forecast intermodal transport activity for the planned terminal in Source: ILiM Growth indicator Volume of transport for the terminal incl. Flavia South direction Growth indicator Volume of transport for the terminal incl. Flavia South direction Year annual (previous year = 100) cumulatively (2010 = 100) [in thousand tons] [in thousand tons] 107,2 107,2 107,2 107,2 107,2 107,2 110,6 110,6 110,6 110,6 110,6 100,0 107,2 114,9 123,2 132,1 141,6 156,7 173,4 191,9 212,3 234,9 60,1 64,5 69,1 74,1 79,5 85,2 94,3 104,3 115,4 127,7 141,3 7,7 8,3 8,9 9,5 10,2 11,0 12,1 13,4 14,8 16,4 18,1 Year annual (previous year = 100) cumulatively (2010 = 100) [in thousand tons] [in thousand tons] 112,6 112,6 112,6 112,6 112,6 113,6 113,6 113,6 113,6 113,6 113,6 264,5 297,8 335,2 377,4 424,9 482,8 548,6 623,4 708,4 804,9 914,6 159,1 179,1 201,6 227,0 255,6 290,4 330,0 375,0 426,1 484,1 550,1 20,4 23,0 25,9 29,1 32,8 37,3 42,3 48,1 54,6 62,1 70,5-19 -

20 Structure of unit loads in intermodal transport An analysis of the structure of unit loads in rail transport clearly demonstrates that the dominant role is played by large containers, with only a minor share of swap bodies (Table 3-13). Table 3-13 Structure of unit loads in rail transport in 2010 Source: ILiM, based on data from the Central Statistical Office (GUS) Transport Results 2010 Load unit Transport volume [in thousand tons] share large containers ,01% road vehicles 112 0,00% semi-trailers 747 0,02% swap bodies ,98% Total ,00% Since intermodal transport is dominated by containers, a container was adopted as the basic unit load for analyzing freight turnover in the planned terminal. Table 3-14 lists basic data about the structure of container transport by standard gauge rail in Table 3-14 Large container transport by rail in 2010 Source: ILiM, based on data from the Central Statistical Office (GUS) Transport Results 2010 Container types Transport [pcs.] Share containers 20' ,2% - full ,5% - empty ,7% containers 30' ,7% - full ,3% - empty ,4% containers 40' ,1% - full ,1% - empty , 0% Total ,00% - full ,8% - empty ,2% Based on above data for large container transport by rail, the following conclusions emerge: the basic unit loads in intermodal rail transport are 40 and 20 containers which make up 66.1% and 28.2% of all containers transported by rail, respectively, since 30 containers account for only a minor part of freight turnover and only hold a 5.7% share in container rail transport, they were excluded from further analyses, empty containers make up nearly one third of all containers in rail transport. Results obtained in the analyses were incorporated into technology and organization assumptions adopted for the planned terminal

21 3.2 Market players Characteristic of the potential suppliers of the services Providers of services for the planned terminal will include: providers of transport services: o supraregional carriers (rail transport), o regional carriers (road transport), providers of terminal-related services (optionally), other providers (security, administration, etc.). The most important group comprises carriers providing intermodal transport services at the supraregional level. The main markets players in this segment are still PKP Group companies (i.e. PKP Cargo and PKP LHS) which jointly hold more than a 73% share in the total weight of transported goods and transport performance (2010 data). The market status of Lotos Kolej on the intermodal transport market has been growing. The company has acquired nearly a quarter of the market over just two years. Other carriers account for ca. 1% of all transport activity, i.e. hold less than 2% of the market. Figure 3-3 Carrier shares in the intermodal transport market in 2010 Source: Funkcjonowanie rynku transportu kolejowego w Polsce w 2010 roku study prepared by the Department of Rail Transport Regulation of the Rail Transport Office Transport conditions offered by rail carriers are the most important limitation (or risk) in the planned terminal s operation. Other services, due to relatively strong competition on the market are unlikely to have a major impact on the success of the terminal. A barrier to entry, particularly for local carriers, can be unavailability of semi-trailers suitable for transporting containers. At present, such semi-trailers are not used frequently in the impact area of the planned Konin terminal. The hindrance, however, is expected to last only for the first several months of the terminal s operation, depending on the flexibility of road carriers who will purchase appropriate equipment to address growing demand problems

22 3.2.2 Characteristic of the potential recipients of the services The basic services to be provided by the terminal include reloading and storage of container shipments, also those requiring special storage conditions. Additional services will comprise consolidation of consignments into full container loads as well as activities relating to the transformations bulk to container and container to bulk. Additional services are not currently planned for the terminal s operation. With thus defined range of services, customers of the terminal will be business entities whose scale of operations justifies the use of container shipments. Generally, the terminal s services will be used by companies for which intermodal transport is a convenient option chiefly because of lower costs and which do not transport urgent consignments (for shorter distances road transport is usually faster). Consequently, the group of potential customers of the terminal includes businesses that will export/import a minimum of one TEU during one week and will not require their cargo to be shipped within a very short time. As regards customers, it will also be necessary to overcome the barrier to entry related to a change in the method of loading/unloading outside transport and (for exporters) a change in cargo packing. 3.3 Competition Characteristics of the existing terminals Table 3-15 shows the main attributes of container handling terminals in Gądki, Kobylnica, Swarzędz, Kutno and Łódź which are considered potentially competitive to the planned container terminal in Konin. Table 3-15 Main attributes of containers terminal regarded as competitive to the planned project in Konin Source: Own research project (no. 4 T12C ) on Przewozy multimodalne ładunków zjednostkowanych w Polsce w relacji zachód wschód i wschód zachód ILiM 2007 Location Kobylnica near Poznań Gądki near Poznań Cargo handling equipment Swarzędz- Jasin Owner CARGOSPED Grupa PKP CARGO S.A. POLZUG Intermodal Polska Sp. z o.o. Centrum Logistyczno- Inwestycyjne Poznań CLIP Sp. z o.o. Total area Storage area 24-h cargo handling capacity Number of tracks for cargo handling Length of tracks for cargo handling [m 2 ] [m 2 ] [ITU] [pcs.] [m] lack of the data 235 Target x x x lack of the data x 1000 [pcs. x lifting capacity] 2 mobile cranes, Q=45 t each 4 mobile cranes, Q=45 t each 1 mobile crane, Q=40 t

23 Location Krzewie k.kutna Łódź Olechów Owner Total area Storage area 24-h cargo handling capacity Number of tracks for cargo handling Length of tracks for cargo handling [m 2 ] [m 2 ] [ITU] [pcs.] [m] PCC Intermodal lack of the data x 700 SPEDCONT Spedycja Polska Sp. z o.o x 700 Cargo handling equipment [pcs. x lifting capacity] 3 mobile cranes, Q=45 t each 2 gantries: 2 x 31 t 2 mobile cranes: 1 x 41 t 1 x 12 t Container terminal in Kobylnica near Poznań The terminal s logistics operator is CARGOSPED Sp. z o.o. owned in 100% by PKP Cargo S.A. In view of the fact that the terminal occupies a limited area and has cargo handling rail tracks of inadequate length, it does not conform to parameters required of modern container terminals. The terminal s location is a major factor substantially hindering its further development. What is more, the terminal has no power supply infrastructure for special-purpose containers. Limited length of container handling tracks translates into the terminal s limited handling capacity, while container trains can only be handled with additional manoeuvring which generates extra handling costs. The growth potential of the terminal is rather small and if forecasts assuming an increase in Polish container transport in international exchange of goods are realized, Kobylnica will not be a major competitor to Konin because it will be unable to handle growing container streams. Despite that, it needs to be noted that the terminal s current handling capacity is not used to the full. Container terminal in Gądki In September 2011, POLZUG Intermodal Polska Sp. z o.o. commenced the operation of a new container handling terminal in Gądki near Kórnik, in the immediate vicinity of an existing terminal which could not be expanded further and was, therefore, closed down the moment the new terminal was put into service. The new terminal was designed as a container handling hub primarily for containers transported from the Hamburg port to Poland. The terminal s mode of operation is as follows: every day, several trains with container cargo reach Gądki. Containers for customers in the Poznań agglomeration and in the Wielkopolska region are unloaded and delivered by road transport. On the other hand, containers for customers in other regions of Poland are reloaded into two trains used for regular container transport (so-called block trains operating between the terminal in Gądki and POLZUG-owned terminals in Pruszków near Warsaw, Wrocław and Dąbrowa Górnicza). The trains operate without using marshalling yards

24 In addition, the terminal will provide services to intermodal transport operators organizing the movement of containers from different locations. Ever since the official launch in September 2011, the terminal has handled cargo transported via container trains from Hamburg and Gdynia. The terminal has a very good location and technical facilities (Table 2.1). At present, it has four rail tracks for container loading/unloading (650 m long each). On both sides of the four-track group for cargo unloading, there are two circulation yards measuring 700 x 26 m each, for mobile cranes. The total area of circulation yards is 18,200 m 2. The target is for the terminal to have fourteen (14) rail tracks (including two (2) electrified along the entire length) and a third circulation yard with the same dimensions as the two existing ones. Following the first implementation phase, which was completed in August 2011, the terminal has four (4) mobile cranes with the lifting capacity Q=45 t each. Upon completion, it will have two additional gantries with a similar lifting capacity. The storage depot makes it possible to store a total of 1,700 containers (the target number is 3,400). Also, there are 135 sites for containers requiring electric power supply. The terminal is not oriented towards long-term storage of either full or empty containers. The facility operates on the principle of quick cargo reloading and delivery of goods to their respective destinations followed by the return of empty containers to ports. At present, the terminal handles five (5) Hamburg-Gądki train pairs a day, in addition to one (1) Gdynia-Gądki train pair a week, one (1) Gądki Wrocław Dąbrowa Górnicza train pair daily for six days a week, and one Gądki Łódź Pruszków train pair seven days a week. To address the needs of the terminal, the investor built a road section (320 m long and 10 m wide) connecting the terminal with a road joining the S11 fast traffic road with Panattoni, Raben, Kuehne & Nagel and PointPark warehouse storage centres located in its vicinity (up to 1 km). Because of its expansion potential, the terminal in Gądki can be competitive to the terminal in Konin in terms of loads transported to areas in which impact areas of both terminals overlap (e.g. regions around Września or Jarocin). Container terminal in Kutno The rail container terminal in Kutno, which was put into operation in September 2011, complies with standards applicable to full-size containers. The terminal has two rail tracks for cargo handling (700 m long each), which makes it possible to handle whole container trains without any additional manoeuvring. Furthermore, the terminal has spacious yards for container storage and reserves of land for further expansion

25 Łódź Olechów The container terminal in Łódź Olechów is the largest of all the terminals analyzed in the study. The terminal has rail tracks suitable for handling container trains without having to split them into sections and additional manoeuvring activities. From the point of view of potential risks, the Łódź terminal may be competitive to the planned terminal in Konin only in the transport of containers from the sea ports in Gdańsk and Gdynia because of better railway connections. Container terminal in Swarzędz The container terminal in Swarzędz is only a temporary facility due to its limited technical infrastructure and it is only beginning its operation. As the owner declares, it will be expanded to cater for new business, if necessary. The area is sufficient for expansion. Current and future handling capacity of container terminals under analysis The handling capacity can be rapidly increased in three container terminals: in Gądki, Kutno and Łódź. The rail terminal in Gądki will be expanded. According to the second stage of development adopted for the facility, the number of cargo handling rail tracks will be increased to 12. Two gantries with the lifting capacity of Q= 45t each will be added to the four (4) existing mobile cranes, thus increasing the terminal s total lifting capacity. The container terminal in Kutno has spare land for further expansion, however no information was provided by the owner about any plans to develop the terminal. The container terminal based in Łódź Olechów has some reserve handling capacity, as well as additional areas for cargo handling and container storage. A significant obstacle to expansion, however, is the lifting capacity of handling equipment. For example, existing gantries are unable to handle containers with a gross weight exceeding 31t. The container terminal in Swarzędz-Jasin also has spare land for further expansion. Since, however, the current potential is not used to the full and the terminal is still in its early phase, no further extension is currently scheduled. As for the container terminal in Kobylnica, it has no real potential for improving its handling capacity

26 Connections of the container terminal under analysis with road transport infrastructure Table 3-16 shows an assessment of transport connections of existing container terminals performed by experts from the Institute of Logistics and Warehousing. Table 3-16 Assessment of terminals transport connections Source: Own research project number 4 T12C : Przewozy multimodalne ładunków zjednostkowanych w Polsce w relacji zachód wschód i wschód zachód ILiM Location Kobylnica Assessment of transport connections Poor Gądki Swarzędz-Jasin Krzewie Łódź Olechów Very good Good Very good Very good The container terminal in Gądki has the best connections with existing road infrastructure. The reconstruction of the national road no. 11 (Poznań-Kórnik section) to bring its parameters up to those of the fast traffic road S11 was completed in June As part of the reconstruction project, the investor provided convenient access between the terminal and the S11 road, and then to all required destinations. The rail terminals in Krzewie and Łódź Olechów are well connected with the surrounding road network, too. Access roads are of appropriate technical standard and traffic capacity, and link both terminals with national roads and motorways (A1 and A2) without interfering with other traffic functions. Access to the terminal in Kobylnica does not meet the needs of multi-ton cargo, while container transport is in conflict with normal traffic taking place along the local road used by the area s residents. Locations of the container terminals under analysis are shown in Figure

27 Figure 3-4 Connections of existing container terminals with the road network Source: ILiM Container terminal at the Poznań-Franowo railway station PKP Cargo has plans to build a new container terminal at the Poznań Franowo railway station. No dates are known for the implementation of the project. When completed, the container terminal in Kobylnica will be an auxiliary facility used by the PKP Group (CARGOSPED, user of the Kobylnica terminal, is a member of the Group) for selected cargo groups, e.g. chemicals, or will be eventually put out of service. The terminal in Poznań-Franowo will not pose a competitive risk to the terminal in Konin. The two terminals may compete for cargo to a similar extent as the terminal in Gądki. Furthermore, the likelihood of the terminal s construction is rather low

28 3.3.2 Operators providing intermodal services in connection Poland FLAVIA South Intermodal operators Polish intermodal terminals can be divided into two main groups: a) the terminals created mainly to reload between trains operating on different widths of the rail west/central and east European, this group of the terminals, located mainly close to the east border of Poland, are focused on mass goods and wagon reloading, the intermodal services are rarely offered, b) the container terminals, with intermodality as a main service. Intermodal (rail/road) services are supplied by a few operators, among which the most important are: CTL Logistics, PCC Intermodal, PKP Cargo (financial related with two others: Tradetrans and Cargosped), POLZUG Polska, HUPACK, SPEDCONT Spedycja Polska, PROKONT. The corresponding attraction areas of the intermodal terminals cover bigger industrialized part of the area of Poland. Some areas with lower industrial potential are still awaiting investors. Figure 3-5 Intermodal terminals in the FLAVIA area Source: Flavia materials

29 Existing scope of accessible intermodal services Since the main flow though Poland leads along East-West line none of mentioned above operators declares any direct intermodal connection between Poland and FLAVIA South countries. Apart from dedicated connections there is no sequential connection actually established. HUPAC indirect connection Actually indirect possibility of intermodal transport between Poland and FLAVIA South leads through Germany. The net of connections of HUPAC allows connecting Polish terminals in Kobylnica, Sławków and Warszawa with Hungarian (Budapest) and Romanian (Curtici, Bradu De Sus) and Austrian (Wien) ones, via reloading terminal in Duisburg. The financial and time effectives of the circular connection should be taken into detailed consideration. PCC plans PCC Intermodal is preparing connection with Hungary. According to interview with president of the PCC Intermodal in the second part of the 2011 year regular connection between new terminal in Kutno and terminal in Sopron will be the fact. Further distribution from Sopron will be taken over by the local partners of PCC Intermodal. The regular connection with Hungary will be the first step of PCC Intermodal development into the South direction. The long-horizon plans (till 2015) assume direct connections with ports of Adriatic coast Triest and Koper (see Figure 3-6). The connection between terminals in Brzeg Dolny and Triest will lead probably through Praha and Munich, the connection of terminals in Sławków and Koper assure intermodal link with Bratislava and Wien. The planned shuttle net will put PCC Intermodal into the position of unquestioned leader in south direction of intermodal transport (when considering Polish market). Dedicated intermodal connections The identified need creates the service. The terminal in Kobylnica has established regular connection to/from Austria. The Polish sister company, the customer of the operator of Kobylnica terminal, is cooperating with its parent one and regular intermodal connection was indicated as the most effective solution. This is the example of dedicated connections, which are possible, but actually sporadic

30 Figure 3-6 Directions of planned developments of PCC connections Source:

31 4 Evaluation of the indicated project localization 4.1 Characteristics of the properties The real property under assessment consists of land plots owned by the State Treasury and currently used by PKP. The estimated real property area required for the construction of the terminal is ca. 43,590 m 2. The boundaries of the area are delineated by: rail infrastructure of the Konin railway station to the north, an arbitrary boundary running ca. 200 m away from Kleczewska street and in parallel to that street to the east, concrete fencing running in parallel to Spółdzielców street to the south, boundary running in parallel to Hurtowa street, ca. 100 m westwards, which is the main access road to the container terminal to the west. The actual shape and footprint of the real property under analysis are shown in Table 4-1. Figure 4-1 Structure of use for the project s area Source: ILiM Terrain The real property under analysis has an even terrain and its dimensions make it possible to properly arrange the terminal s infrastructure according to the needs of the container terminal (Figure 4-2 and Figure 4-3)

32 Figure 4-2 View of the areas of the planned container terminal (to the west) Source: Photo by ILiM Figure 4-3 View of the areas of the planned container terminal (to the east) Source: Photo by ILiM The only obstacles existing in the area are sections of rail tracks which are either disused or used occasionally for the unloading of aggregate materials. Some of them will be put into service as elements of the terminal s rail infrastructure. Sections that will no longer be necessary will be disassembled and the resulting material will be used for construction or modernization of rail tracks that will be needed for container handling (Figure 4-4)

33 Figure 4-4 Rail tracks in the future terminal (current status) Source: Photo by ILiM 4.2 Assignment of the properties According to the Local Area Development Plan for Konin (Kleczewska and Poznańska streets) adopted on 22 June 2006, the majority of areas recommended for terminal construction are designated for rail transport (Table 4-1). Table 4-1 Designation of investment land Source: ILiM, based on data obtained from the Municipal Office in Konin No. Designation Intended purpose of land Area [m 2 ] Share 1 Tk Areas allocated for rail transport ,8% 2 Ba Industrial areas ,2% TOTAL ,0% In order to use the land for container terminal construction, its designation in the development plan will need to be changed, i.e. it will have to be reclassified as business activation areas. This, however, will require cooperation with the main user of the real property in question, i.e. PKP. There are no other limitations resulting from the Local Area Development Plan

34 Land ownership structure The area proposed for the terminal occupies a total area of 43,590 m 2 and has a uniform ownership structure. A detailed statement of owners and uses of different areas is given in Table 4-2. Table 4-2 Structure of ownership of the area selected for terminal construction Source: ILiM, based on data obtained from the Municipal Office in Konin No. Owner User Area [m 2 ] Share 1 State Treasury Konin town ,8% 2 State Treasury PKP S.A ,2% TOTAL ,0% The uniform ownership structure of the State Treasury is a significant factor in favour of the planned project. The dominant position of PKP as the perpetual usufructuary should be seen by investors as an important incentive for becoming engaged in the terminal s construction. 4.3 Infrastructural resources Water supply and sewage systems The area under study is not connected to any water supply and sewage system. Water can be supplied to the area from the municipal water supply network DN 400 which runs along Spółdzielców Street, ca. 175 m from the terminal s entry. The closest sewage system connection (DN 200) is at the junction of Spółdzielców and Hurtowa streets, ca. 175 m from the entry gate to the planned terminal. Rainwater collection system The main storm water drain (DN 500) is located at a distance of ca. 200 m from the limits of the project s area, at the junction of Spółdzielcza and Bł. M.M. Kolbego Streets. Gas supply system The area of the planned project is not connected to a gas grid. The closest connection, to the low-pressure gas pipeline (DN 200), is located ca. 880 m from the terminal s entry at the junction of Kleczewska and Al. 1 Maja

35 Power supply system The area of the project has a power supply system (230V /380V) used for lighting purposes, owned by PKP. Connection to the municipal power supply network is possible via one of two existing transformer stations located in adjacent land plots at Spółdzielców Street at a distance of ca. 160 m from the southern boundary of the terminal s area. There is a possibility of increasing allocated power according to the power demand of the future project. Heating system The heat supply main (2 x DN500) running along the project s area makes it possible to connect the terminal s facilities. 4.4 Possible direction of the extension After completing the implementation stage and putting the terminal into service, the facility will not have a large potential for expansion. When the terminal is launched, almost entire available area will be occupied. Because of the existing rail track layout in the Konin railway station, it will not be possible to extend the length of the rail tracks for cargo handling (Figure 4-5 and Figure 4-6). Figure 4-5 Limitations to the terminal s expansion to the east Source: Photo by ILiM

36 Figure 4-6 Limitations to the terminal s expansion to the west Source: Photo by ILiM Increasing the capacity of storage depots will not be possible without demolishing garages adjacent to the terminal s south-eastern boundary (Figure 4-7), which will provide an additional 6,500 m 2 of storage area accommodating ca. 350 TEU. Figure 4-7 Limitations to the terminal s expansion to the west Source: Photo by ILiM The above limitations do not mean that the overall assessment is negative. The planned number of rail tracks for cargo handling and storage depots will offer the terminal a chance for load

37 ing and unloading cargo on a scale which cannot be matched by any other Polish container terminal. Moreover, it needs to be noted that the scheduled handling capacity will result in containers being transported by road along Hurtowa Street, which will put an additional load on the junction of Hurtowa and Spółdzielcza streets (additional traffic of semi-trailer tracks, ca. 3 hours a day). It is not ruled out that the heavy vehicle traffic with cargo containers will have to be scheduled for times outside the morning and afternoon rush hour to ensure smooth drive across the junction and a smart traffic control system will need to be assembled in the junction. 4.5 Transport condition The terminal under analysis lays in the immediate vicinity of the national road no. 92 (E30) and the national road no. 25. The former, DK 92, runs in parallel to the A2 motorway, while the national road no. 25 makes it possible to link the terminal with A2 and the Wrocław agglomeration in the south and Central Pomerania in the north. An undeniable advantage of the location is close proximity to the A2 motorway. T he closest motorway junction, Modła Królewska, lays ca. 12 km away from the planned container terminal location. The existing motorway section (Nowy Tomyśl Stryków) allows connecting the area of the container terminal and the Logistics Centre Konin Stare Miasto S.A. in Modła Królewska with three agglomerations: Poznań, Łódź and Warsaw (connection via motorway to be launched in 2012) and the border crossing in Świecko (connection via motorway to be launched towards the end of 2011). Details regarding transport connections of the planned terminal are marked in Figure

38 Figure 4-8 Transport connections of the planned container terminal Source: ILiM A definite strong point of the container terminal located next to the railway station in Konin is its close distance to the A2 motorway which is a part of the second pan-european transport corridor. Other advantages include good connection with the A2 motorway node in Modła Królewska and the Wielkopolska Logistics Centre Konin-Stare Miasto S.A. located at the node. Furthermore, the Modła Królewska node is located just 3 km from another A2 motorway node in Żdżary, where the municipality of Stare Miasto is planning to organize an industrial zone that will generate a strong demand for logistics services. An equally important factor for the planned project is good connection to Poland s major sea ports which are potential handling sites for foods exported/imported to/from Poland

39 In this aspect, it is important to note that new A1 motorway sections will soon be put into service: Nowe Marzy-Toruń (by the end of 2011) and Toruń-Stryków (April 2012), facilitating convenient access between the terminal and the sea ports in Gdańsk and Gdynia. The completion of the fast traffic road S3 (Międzyrzecz-Gorzów section) by the end of 2013 will connect the terminal conveniently with the Szczecin-Świnoujście ports. In view of the project s large impact area and its important functions in the Polish network of intermodal transport, it is vital to ensure that the terminal is well connected to the major economic centres existing in the region. Table 4-3 contains a list of road distances and estimated durations of road transport between the planned terminal in Konin and major economic centres in the terminal s impact area. Table 4-3 Connection of the planned terminal location with the region s major economic centres Source: ILiM Destination (town) Distance [km] Duration of the travel [hrs.] Gniezno 63,5 1,5 Września 62,2 1,0 Jarocin 71,3 1,7 Kalisz 56,7 1,3 Turek 35,5 0,8 Koło 32,5 0,7 Inowrocław 74,4 1,6 Mogilno 71,4 1,5 Results of simulations listed in Table 4-3 show that the duration of drive from the location under analysis to any of the towns listed above does not exceed 4.5 hours. Based on relevant regulations on drivers working time (AETR convention) it appears that transport services can be performed by a single driver without any breaks on the way, which markedly reduces duration and total costs of transport along these routes. The situation thus gives rise to a substantial potential for the organization of intermodal transport based on rail. The potential is even greater as the terminal is located immediately next to the E20 (C-E 20) railway line which plays a great role in international rail transit and is regulated under international agreements (AGC1 and AGTC2). 1 AGC Agreement on main international railway lines 2 AGTC Agreement on important international combined transport lines and related installations

40 315 km Freight and Logistics Advancement in Central/South- Distances between sea ports and the terminal s planned location are comparable with distances for road transport (Figure 4-9), however taking into account heavy vehicle traffic in the region and the distance between the Konin terminal and sea ports, the organization of container trains seems justified (Figure 4-9). An alternative to traditional rail and road transport would be fast block trains operating between sea ports and the Wielkopolska Province. Port Gdynia Port Gdańsk Port Świnoujście Port Szczecin 350 km 335 km 398 km Planowany teren terminala kontenerowego Figure 4-9 Distances between sea ports and the container terminal (by rail) Source: ILiM

41 5 Strategy of the pre-feasibility study 5.1 Offered services The planned terminal will offer the following services: basic services: handling of full and empty containers, storage of containers with: regular cargo, goods requiring cold storage, hazardous goods, cargo requiring customs clearance, storage of empty containers preparation/storage of documentation for container turnover. auxiliary services (to be implemented if a demand emerges): container cleaning, container washing, minor container repairs, container weighing, removal or placement of advertising materials. 5.2 SWOT indication Strengths and weaknesses of the undertaking, divided into external and internal factors, are listed in Table General Business Model In order to develop a scheme for the development of the project area and determine basic financial parameters, the following assumptions were made in terms of organization and technology of container terminal operation

42 External Internal Freight and Logistics Advancement in Central/South- Table 5-1 SWOT indication Source: ILiM Strengths (potential) access to investment areas (owned by State Treasury), location in the immediate proximity of rail tracks, uniform ownership structure of the project s area, access to basic utilities. Opportunities forecast major growth of demand for intermodal transport, no direct competitors in the project s impact area, good transport connections of areas zoned for the terminal, economic factors justifying use of the Konin Terminal by businesses operating in the project s impact area. Weaknesses need to acquire a strategic investor, need to overcome significant barriers to entry (strong competition, major investment outlays), area of the planned project is leased by PKP, no potential for expansion beyond the currently planned area, no possibilities of expansion. Threads inadequate level of intermodal transport development in the region, growth of competition in adjacent regions, competitors with established market standing, necessity to gradually build a market position Organizational assumptions Organization of the terminal s operation 1. The terminal will work in two shifts, from 8.00 a.m. until 8.00 p.m. 2. Each working shift will last 8 hours. 3. The terminal will gradually work towards the full absorption of the estimated flow of foods, which will be achieved in the 5 th year of the terminal s operation. 4. Intermodal transport handled by the terminal will be gradually increased until the exhaustion of the terminal s storage capacity. Organization of the flow of containers through the terminal 1. Container transport by rail: a) containers delivered by rail to the terminal will be filled in 100%. b) full containers delivered to the terminal by rail will be unloaded: 25% directly to trucks, 75% to the storage depot

43 c) the average storage period of full containers (until their delivery to the final customer) will be 4 days. 2. Transport of empty containers by road: a) empty containers delivered to the terminal by road will be placed in the storage depot. b) the average storage period of empty containers in the depot will be 14 days. 3. Transport of full containers by road: a) 30% of empty containers, after their storage period, will be transported by road to customers for cargo loading, and then transported back to the terminal, b) containers delivered to the terminal by road will be: reloaded directly to cargo wagons (65%), placed in the storage depot (35%), containers designated for rail transport will be stored for 2 days and then loaded into wagons. 4. Release of containers for rail transport: a) make-up of trains leaving the terminal: 30% of full containers, 70% of empty containers. A diagram illustrating the organization of flow of unit loads through the rail terminal is presented in Table 5-2. Table 5-2 Diagram of the organization of the container flow through the terminal Source: ILiM No. of wagons SPECIFICATION no. of contain. share % No. of wagons Unloading to storage depot Storage Loading to vehicles Rail deliveries (full containers) no. of no. of no. of share share time share contain. contain. contain. 25% 7 75% 23 75% % 23 Road deliveries (empty containers) Loading to wagons share no. of contain. no. of no. of no. of no. of no. of share share share time share share contain. contain. contain. contain. contain. 70% % 100% % % 9 Road deliveries (full containers) no. of no. of no. of no. of no. of share share share time share share contain. contain. contain. contain. contain. 75% % 25% 3 25% % 6 No. of wagons

44 5.3.2 Preliminary concept of terminal development Technology assumptions The following assumptions were made while developing a concept for technological development of the container terminal s area: a) The terminal s operating area includes: storage depots for containers: full, empty, containing hazardous goods, containing goods requiring customs clearance (recognized customs clearance point), two rail tracks for cargo handling, operating and transport roads, offices and amenity facilities, technical facilities: for container handling trucks, for customs inspection of cargo, technology spare area for the repair, cleaning, washing or storing containers, b) Containers will be loaded/unloaded using container handlers. c) The minimum width of transport roads was assumed at 15.0 m, including the operating area of the container handler and the width of the road stretch for combination vehicles. d) As for container storage in temporary storage yards, the minimum clearance of 10 cm was adopted for cargo handling. e) During loading/unloading operations, containers should be picked up from their longer side. f) Containers will be stored in 4 layers. g) Full containers will be stored in rows, in blocks of 2 (full) or 3 (empty) containers. The concept for technological development of the container terminal s area is illustrated in Figure

45 ul. Hurtowa B. CELNY GARA BIURO + SOCJAL Freight and Logistics Advancement in Central/South REZERWA REZERWA NAPRAWA KONTENERÓW + MYJNIA 7 52 where: T1 and T2 rail tracks P1 P5 storage areas PR1 and PR2 reserve areas B1 office building B2 technical maintenance building B3 customs clearance building Sc truck lot So passenger car park Pe power switching station Ek noise screening wall Figure 5-1 Concept for technological development of the container terminal Source: ILiM The terminal s basic technological and operating parameters were determined on the basis of project assumptions and the concept for the development of the container terminal. Results are listed in Table 5-3. Table 5-3 Basic technology parameters of the terminal Source: ILiM Rail track layout Parameter Symbol Unit of measurement Value number of tracks pcs. 2 operating length of track m 484 track gauge m 6 Total storage capacity P c TEU Total (main) storage capacity P g TEU regular cargo P1 TEU 800 hazardous cargo P2 TEU 112 cargo requiring customs clearance P3 TEU 208 empty containers P4 TEU 576 containers requiring power supply P5 TEU 132 T

46 Parameter Symbol Unit of measurement Value Total (reserve) storage capacity PR TEU 96 storage capacity PR1 TEU 48 storage capacity PR2 TEU 48 Terminal area m main storage area P g m reserve storage area PR m area of the office and amenity building (layout) B1 m 2 70 area of the technical maintenance building B2 m area of the customs clearance building B3 m area of truck lots Sc m area of passenger car parks So m area of transport roads m operating area m area of the rail track system T m greenery area m Estimated financial needs Estimated outlays together with rough schedule of payments are listed in Table 5-4. Table 5-4 Project outlays and schedule of payments (local currency) Source: ILiM No. Specification Year Year 1 Year 2 Net value [PLN] 1 Land preparation for the project Geological survey of land Removal of old surface and disposal at a distance of 1 km Land levelling Utilities Storm water drainage system with 2 separators Storm water drain Sewage system for hazardous materials (complete with a storage tank) Construction of sanitary sewage system Construction of water supply system Fire hydrant system

47 No. Specification Year Year 1 Year 2 Net value [PLN] 2.7 Fire water tank 100 m Fire pump station Central heating system Connection of pre-insulated heating system (diameter: 2x100 mm) Compact connection node (measurement, adjustment) Power supply system Switch station with container outlets Rail track works Manual disassembly of rail tracks on wooden sleepers, followed by the transport of resulting materials to a storage area; rail mounting with screws, rail type S-49 Manual disassembly of regular rail turnouts; turnout bend 1-9, radius of the arc R-190, rail type S-49 Construction of cargo loading rail track with base course and S-49 rails placed on concrete sleepers Inspection and repair of the existing rail trackage

48 No. Specification Year Year 1 Year 2 Net value [PLN] 4 Road works Cast loading yard Storage depots Car park + roads Construction works Construction of office facility Construction of garage and customs clearance facility Others Wire mesh fencing (2.00 m high) mounted on steel poles spaced every 2.10 m, made of pipes (76 mm in diameter), embedded in concrete. Monitoring. A total of 10 security cameras and a control panel were assembled. Lighting system. A total of 20 lighting outlets with service connections were installed Noise screening wall (5.0 m high) Automatic drive gate Implementation Development of documentation 3% of the value of task Project supervision by investor 2% of the value of task Equipment KALMAR forklift trucks Computer + office equipment Total Added value of the product The terminal in Konin will be the sole container handling and storage area within a radius of 70 km and, at the same time, the only cost efficient location for container handling and storage for enterprises located within the terminal s impact area. It is, without doubt, a unique selling proposition (USP) on the scale of the region because no other terminal will be able to provide similar services at a comparable cost

49 6 Operation The precondition for initiating the project will be acquiring a strategic investor to provide funds for the construction of the terminal with the support of Konin s town authorities, either in the form of contribution in kind or convenient terms of long-term lease of land for the project. The operation of the terminal will depend on the form chosen by the investor. 6.1 Necessary supplier and cooperating companies Subsection specifies supplier groups. Out of those, the most important are rail carriers (mostly PKP Group and Lotos Kolej) and local carriers whose services are required for delivering containers from/to the terminal within its impact area. In view of the strong position of PKP Group (slightly less than 75% market share) the terminal in Konin will have to cooperate with this carrier. Other companies (with the exception of Lotos Kolej) only account for 2% of intermodal transport. Consequently, the establishment of terms and conditions of cooperation with PKP Cargo is a necessary precondition for the success of the project. The majority of areas designated for terminal construction are owned by the State Treasury, though they are currently used by PKP Group. This is another sign of PKP Group s influence on the initiation and success of the project. According to the central register of vehicles kept by the Ministry of Internal Affairs and Administration, in 2010 the Wielkopolska Province had the second largest fleet of tractor units in Poland (after the Mazowsze Province), which accounted for over 11% of all tractor units registered in Poland. Consequently, the potential of local carriers ranks among Poland s best and is perfectly sufficient for operating the terminal. A barrier to entry on the intermodal transport market, especially for local carriers in the terminal s impact area, can be lack of access for semi-trailers adapted for transporting containers which are not currently used very often in the impact area of the Konin terminal. Stable demand for local transport of containers will, however, have an effect on the local transport market which will gradually adjust its offer by organizing appropriate equipment. 6.2 Assets and capacities to be used Resources that will be used during the project s implementation include investment land stretching along the rail tracks (railway siding) and transport connections (two access roads) with the national road network. The division into building plots and their status are described in chapter

50 7 Service Launch Plan 7.1 Stages of the implementation It was assumed that the project would take 2 years to complete. The two phases will be: 2012 preparation of project documentation, acquisition of required permits, performance of geological surveys of land construction of the terminal s infrastructure and purchase of handling equipment. 7.2 Schedule of the project realization The schedule of project implementation broken down into investment outlays for the project s assumed two years of implementation is presented in Table

51 8 Business Development Due to the nature of the project, it will be implemented and expanded within a long-term perspective. Consequently, subsections only contain references to results obtained in relevant earlier analyses. 8.1 Forecast of the basic economic indexes changes The forecast for the growth of transport was prepared on the basis of a study conducted by Prof. J. Wronka, PhD (hab.) investigating tendencies in combined/intermodal transport in Poland in The study is reported in the work called Intermodal logistics network in Poland a concept of model solutions and implementation-related factors [1]. The forecast is based, among others, on the following assumptions regarding economic indicators (based on [1]): a) there will be a downward trend in the rate of GDP growth from ca % per annum in to ca % per annum in b) the share of export in GDP will rise from 29.9% in 2006 to % in c) the share of import in GDP will grow from 33.7% in 2006 to % in d) the mean value of one ton of cargo in Polish foreign trade will rise from PLN 3,968 in 2006 to over PLN 9,100 in e) the indicator of intensity of Polish foreign trade will drop from ton per GDP of 1 million PLN in 2006 to ton per GDP of 1 million PLN in Customer structure and possible changes No modifications of the customer structure are anticipated. The group of potential users of the terminal s services will grow along with the forecast expansion of transport activity in the terminal s impact area. 8.3 Forecasted of the changes in material flow Forecast changes in combined freight flows until 2030 are described in Table In turn, Table 3-11 presents forecasts for intermodal transport for the planned terminal until

52 9 Indicators of the implementation 9.1 Number of jobs to be created through investment According to plans, cargo will be handled by 9 workers (the target figure) including a manager (manager s deputy), forwarders and operators. The positions are directly related to cargo handling activities. In addition to them, however, other jobs will be created for terminal administration activities (security, cleaning, maintenance, etc.). Also, new employment will be generated in cooperating companies, forwarding companies in particular. It is believed that a total of 30 new jobs will eventually be created in the terminal s impact area due to the terminal s operation. The majority of them will be generated in the Konin district. 9.2 Amount of the transport volume of the new services The forecast volumes of intermodal transport for the planned terminal in are listed in Table Importantly, the increase in intermodal transport activity will be accompanied by a proportional reduction of road transport, both national and international, within the terminal s impact area. Cargo handling activity performed at the terminal will also create demand for local transport services (within a 50 km radius) in proportion to the volume of handled cargo. The mean distance covered by a container will be ca. 20 km. With the assumption, and the weight of cargo handled at the terminal, the estimated level of transport activity will achieve 18.8 ton-kilometres per year in The figure is approx. 50% lower than for alternative transport bypassing the terminal

53 10 Financial evaluation of the project The chapter below evaluates the financial efficiency of the project of construction of a container terminal in Konin based on verified income, costs and investment outlays. The internal return rate (IRR) and net present value (NPV) of the project were calculated. Results presented below show that the project is an attractive business venture and are the first test confirming that the project is worth pursuing Financial assumption of the project A forecast of revenues was prepared on the basis of forecasts developed for services to be offered by the container terminal. Unit prices of logistics services adopted for the forecast result from the analysis of the Polish market and take into consideration the level of price competition on the local market. Table 10-1 Price list of terminal services Source: ILiM Handling of containers Service Unit Rate Comments full PLN 100 The price covers empty PLN one container lift 80 Storage of full containers containers 20' containers 40' PLN /24 hrs. PLN /24 hrs payable from the 4 th day Storage of empty containers containers 20' containers 40' PLN /24 hrs. PLN /24 hrs. 4 8 payable from the 11 th day Handling of documentation and labelling PLN/piece 65 Container cleaning and washing PLN/piece 230 Customs clearance of containers PLN/piece 55 - Preparation of container status protocol PLN/piece 15 Handling of refrigerated containers PLN/piece

54 A forecast of operating costs was prepared by types. Depreciation applicable to fixed assets was calculated according to the list of rates listed in the Act on Corporate Income Tax. A linear depreciation formula was adopted. Calculations were performed on the basis of figures defined in Table 10-1, Table 10-2 and Table Table 10-2 Assumptions for the forecasts of the most important cost items Source: ILiM Costs Unit Value Mean gross income of terminal s staff PLN/month Forklift operation PLN/man-hour 165 Manoeuvring activities PLN/man-hour 260 Lease of land PLN/m 2 /month 2,0 Security PLN/year Forklift insurance year 1% forklift value Advertising PLN/year Property tax PLN/1m 2 19,66 Table 10-3 Amortization rates Source: ILiM Depreciation % outlays Buildings 2,5% Area preparation 2,5% Roads and yards 4,5% Tracks for wagons 4,5% Utility systems 2,5% Compact connection node 7,0% Outside lighting 4,5% Area fencing 2,5% Industrial monitoring 10,0% Entry gate 4,5% Computer equipment 33% KALMAR forklift trucks 10,0% Calculations were based on the following assumptions: ca. 6% of containers in use will be refrigerated containers, ca. 12% of containers in use will require central handling in the terminal, ca. 16% of containers in use will be cleared out and washed by the terminal s staff, all containers will be recorded in the system and labelled; interchange of container status will also be performed

55 10.2 Estimated outlays, incomes and operational cost of the project Estimated revenues and costs of the project in are listed in Table 10-4 and Table 10-5 below. Table 10-4 Forecasted revenues (in thousand EUR) Source: ILiM YEAR REVENUES YEAR REVENUES Table 10-5 Forecasted costs (in thousand EUR) Source: ILiM YEAR Total COSTS 319,3 347,3 449,5 459,5 474,6 488,8 508,1 514,0 521,9 533,1 Staff income ,4 61,4 61,4 61,4 61,4 61,4 61,4 61,4 Terminal operation 39,6 39,6 75,6 75,6 75,6 75,6 75,6 75,6 75,6 75,6 Forklift truck operation - - 9,3 19,6 35,1 49,5 69,1 75,3 83,5 94,9 Manoeuvring activities ,7 17,7 17,7 17,7 17,7 17,7 17,7 17,7 Land lease 237,8 237,8 237,8 237,8 237,8 237,8 237,8 237,8 237,8 237,8 Security - 28,0 28,0 28,0 28,0 28,0 28,0 28,0 28,0 28,0 Project supervision by investor 30,5 30, Insurance - - 6,6 6,3 5,9 5,7 5,4 5,1 4,8 4,6 Advertising 11,4 11,4 11,4 11,4 11,4 11,4 11,4 11,4 11,4 11,4 Property tax - - 1,7 1,7 1,7 1,7 1,7 1,7 1,7 1,7 YEAR Total COSTS 546,5 560,5 575,6 591,8 667,5 667,2 666,8 666,5 669,5 669,1 Staff income 61,4 61,4 61,4 61,4 110,5 110,5 110,5 110,5 110,5 110,5 Terminal operation 75,6 75,6 75,6 75,6 83,0 83,0 83,0 83,0 83,0 83,0 Forklift truck operation 105,2 119,6 135,1 151,6 171,2 171,2 171,2 171,2 171,2 171,2 Manoeuvring activities 17,7 17,7 17,7 17,7 17,7 17,7 17,7 17,7 17,7 17,7 Land lease 237,8 237,8 237,8 237,8 237,8 237,8 237,8 237,8 237,8 237,8 Security 28,0 28,0 28,0 28,0 28,0 28,0 28,0 28,0 28,0 28,0 Project supervision by investor Insurance 7,7 7,3 6,9 6,6 6,2 5,9 5,6 5,4 8,4 8,0 Advertising 11,4 11,4 11,4 11,4 11,4 11,4 11,4 11,4 11,4 11,4 Property tax 1,7 1,7 1,7 1,7 1,7 1,7 1,7 1,7 1,7 1,7-55 -

56 10.3 Analysis of financial performance The analysis of financial performance was performed on the basis of assumptions listed below: undertaking analyzed in a 20-year perspective, profit and loss account calculated with the corporate income tax rate of 19%, investment to be financed from bank credit in 50% (on the assumption that the credit will be repaid during 10 years and the cost of the credit will be WIBOR 6M+1%), discount rate of 5.5%, receivables turnover period defined at 30 days and liabilities turnover period at 45 days. The Internal Rate of Return (IRR) and Net Present Value (NPV) determined at the discount rate of 5.5% are presented in Table 10-6 and Table IRR and NPV values were calculated excluding residual value. Table 10-6 NPV and IRR indicators without residual value (in thousand EUR) - part 1 Source: ILiM ANALYSIS OF THE COSTEFFECTIVENESS Year REVENUES Operating revenues Sales revenues CASH EXPENDITURES Increase of fixed assets Increase of working capital Operating costs without depreciation Income tax CASH BALANCE CUMULATIVE CASH BALANCE Discount rate 5,5% Discount factor 1 0,95 0,90 0,85 0,81 0,77 0,73 0,69 0,65 0,62 0,59 Discounted cash balance

57 NPV Table 10-7 NPV and IRR indicators without residual value (in thousand EUR) - part 2 Source: ILiM ANALYSIS OF THE COSTEFFECTIVENESS ROK REVENUES Operating revenues Sales revenues CASH EXPENDITURES Increase of fixed assets Increase of working capital Operating costs without depreciation Income tax CASH BALANCE CUMULATIVE CASH BALANCE Discount rate 5,5% Discount factor 0,55 0,53 0,50 0,47 0,45 0,42 0,40 0,38 0,36 0,34 Discounted cash balance NPV IRR 2,87% The NPV value for the 5.5% discount rate in the variant excluding residual value is negative, which means that the implementation of the project may not contribute to increasing the value of the company and, consequently, increasing the gains of the company s owners. In addition, IRR has a lower percentage value than the cost of capital necessary as funding, which is not interpreted favourably with regard to the project. Only if the residual value is taken into account, the value of NPV is positive and IRR exceeds the cost of capital required for financing, expressed as a percentage. The ROI period for the project under study exceeds 20 years (Figure 10-1)

58 ithousands EUR Freight and Logistics Advancement in Central/South Figure 10-1 ROI period for the 5.5% discount rate Source: ILiM

59 11 Contribution to the FLAVIA Goals 11.1 Strengthening territorial cohesion The South direction intermodal services required some support, similarly like others intermodal services. According the publication on page ( Polish intermodal on the European background by Michal Brylinski from CTL Logistics) intermodal operators are expecting support, which help them win the competition with road transport: The practice of the countries supporting the initiatives for the development of combined transport shows how important is the role of government and carriers cooperation, aiming in relieving the roads and minimize the social costs due to long-term investment. According to this paper carries demand consideration of: 1. Granting financial aid for combined transport. 2. Ensure the budgetary subsidy for investments in new routes and expansion of existing ones. 3. Introduction of preferential loans and guarantees for volunteers to carry out the structural investment in sea ports. 4. Introduction of the tax incentives for logistics centres and intermodal terminals. Apart for incentives the carries pointed out the condition of Polish rail infrastructure. The average trade speed on the rail is on average 20 km/h, which is less than, for example, in Romania, where emphasize is placed rather on inland waterways, when considering intermodality Promoting internal integration The Konin Terminal can be the basis of developing local producers groups or even the clusters. The container capacity usually exceeds SMEs flow requirements, when considering trade exchange. The key to decrease the cost of transport (of the raw material and products) is the practise of the common container. The SMEs groups or even cluster, with properly functioning organization would increase competitiveness of their products by cutting down the transport cost. Even the terminal operator can offer service of common container to wider the circle of the potential terminal customers. Localization of the terminal can incite the enterprises activities around Konin. Direct transport connection is essential the deciding about new investment and development of existing. So apart from long ROI period other aspects of planned terminal influence should be carefully considered. The support from EC funds can be crucial. As examples of existing sources of financing investment projects in the field of intermodal transport can be identified project Marco-Polo, the Operational Programme Infrastructure and Environment, and the Greater Regional Operational Programme (applicant belongs to a group of small or medium

60 sized enterprises could potentially apply in the competition measure 1.2 "Support the development of SMEs in the investment project" planned for I quarter 2012). On the international level the weekly connection between Konin and FLAVIA South countries can lead to integration of group of cooperating terminals and their customers. As the main market for intermodal transport from Poland in considered direction is Czech Republic the cooperating terminal should guarantee excellent connections with Czech market Enhancing the competitiveness The potential investments can be divided into 3 main groups: 1. back facilities of Trojmiasto harbours, 2. development of the terminals, 3. modernization and reorganization of the rail infrastructure. All the investments have influence of commercial attractiveness of the connection between Poland and FLAVIA South. First the Trojmiasto ports are closes port for the some parts of Czech and Slovakia areas. Second capacity and location of the terminals will assure direct and certain intermodal transport. Third the infrastructure in the south part of Poland requires the biggest financial outlays, because of railway infrastructure state and mountainous surroundings. All the investments are on whole polish economy scale with high level of expected outlays. The required outlays, especially with so many option and variants of the investments, are not calculable on scope of this paper. Trojmiasto hub According to D. Stefański, PCC Intermodal SA chairman, the most import for Polish intermodality is building the hub to lighten the load of Trójmiasto harbours or rather their back infrastructure. In 3-4 years efficiency of all sea terminals will reach more than 70% and the congestion on the roads from / to ports will be enormous - the 3 million TEU turnover of Trojmiasto harbours, expected in 7 years, means approximately one container (truck) every 15 seconds in both directions. Of course this level of the flow is high above every motorway capacity. One of considered the solution is the rail transport directly from the harbour to the hub, located a few kilometres from the coast in the depth of the country. This way the congestion of Trójmiasto could be decreased and capacity of the sea terminals will depend only on ports equipment efficiency (which by the way required continuous development) not the possibilities of the back facilities. The low share of the intermodal transport, on the level of 2%, is the reason, that railways operators are not interested in the investment in mentioned above solution. In this case financing system of terminals within the public-private partnership is expected

61 Development of the terminals The net of Polish terminals covers most industrialized part of the country. There is still place for small units, which will reduce the road transport distance (for example Konin). Different aspect is terminal efficiency, which can reach limits in a few years in most cases. In this case very important are investments in development of existing terminals and, similarly like in case of Trojmiasto harbours, in their back facilities. The approximated cost of building of new terminal (Konin Terminal) is calculated in Table 5-4. Modernization and reorganization of the rail infrastructure The trade speed of transport on the level of 20 km/h as far below expected. The investment in the railway infrastructure and organization of the intermodal connection is unavoidable. PKP Polskie Linie Kolejowe SA, which manages the Polish railways, is modernizing the infrastructure, partly with support from EC funds. The stress is placed on most important east-west direction and the cross (south) route is unfortunately in the background. The advance of the trade speed in direction north south, especially in the south part of the Poland, can be expected in approximately 7-10 years. The situation can be radically changed when the market of the goods railways transport will be totally free, which let the abroad operators fully compete with PKP Linking of the terminal to the FLAVIA corridor The return of the investment of the planned terminal is expected in more than 20 years. The financial calculation was prepared for the flow expected from impact area of terminal. The marketing and organizational efforts can change the local / regional terminal in Polish centre if FLAVIA South countries connections. Specialization of the terminal on south direction will probably extend the area of the impact. Dedicated and periodic service in direction considered in this study would reduce ROI horizon. Actually any direct connection between Poland and FLAVIA South countries was not identified. There is possibility to establish periodic connection and focus majority of the intermodal flows Poland / FLAVIA South into one location. As advantages of terminal in Konin can be stated localization in the centre of Poland and quite fine access to the main polish motorway east-west. The weakness of the localization is lack of direct south (and north) rail connection. All the trains to south of Poland have to go via Koło, Września or Poznań, close to the existing terminal infrastructure. There is the real threat of taking over the service by better localized terminal(s). To the most important countries in south direction Czech Republic, Slovakia and Austria have to be included. The three of considered FLAVIA South countries gather majority of considered flow

62 (see Table 3-5). The distances between Konin and main cities of mentioned FLAVIA South countries are shown on Figure CT KONIN 490 km Szczecin 520 km 600 km 630 km 820 km 650 km 830km Figure 11-1 Approximated distances between main cities in considered direction and the terminal Source: ILiM on maps.google.pl Collected data indicates Czech Republic as the most promising link. Agreed periodic connection with one of Czech terminal could bring biggest effects. Conduction of the detailed analysis should indicated best correlated terminals. When taking into consideration additionally parts of Slovakia and Austria potential location can be terminal close to Brno. On the other hand localization of the associate terminal in Praha region opens the gates of economic clusters located around capitol of Czech Republic and along west border with Germany. The possible location on the background of the existing terminal impact areas and economic cluster identification are shown on Figure