New business model is being proposed for KTMB Freight, the most profitable division in KTM Berhad as reported by Bernama.
The proposal, made by railway workers union, is championing the cause of rejecting Malaysian Mining Corporation (MMC)’s bid to invest up to RM 1 billion in KTMB Freight division. The main concern is if MMC takes over KTMB and suffer losses, employees would lose the benefits the they are currently enjoying such as bonuses, allowances, quarters and healthcare. Their proposal is to allow other private operators to use KTMB existing rail lines with their own rolling stock.
We think the step to attract private operators to use KTMB existing railroad network and paying tolls directly to KTMB will generate added revenue. Furthermore, the major constraint suffered by KTMB now is the limited number of rolling stock. In our opinion, we think the government should invest more in KTMB by providing them with reasonable number of rolling stock, in line with the ongoing double tracking project. KTMB’s current market share in cargo shipment of the country is really low with just about two to five percent.
With the promising progress of the double tracking project, we hope that KTMB will invest more on its cargo as well as passenger sector. This move will enable a more profitable KTMB and fulfilling the needs of commuters and commercial sectors.