New Zealand Railways Corporation Annual Report 1985

The 1985 Annual Report marked the third year of the Railways Corporation, but was also notable in marking the first full year of full competition for land haulage of freight.  Also notable was the beginning of the major restructuring of the Railways Corporation business following the Booz Allen report into the future of the railways. November 1984 also saw the end of the price freeze following the election of the Lange Government in July 1984. 

The annual report below has a lot of images of railway staff in various situations, as well as text and data on the numbers for the year. 

In 1985, the Corporation reported a financial loss of just under $20m (that is after receiving Social Services subsidies from the Ministry of Transport at a total value of just under $69.9m for passenger rail services, certain branch lines and some uneconomic road services). Social Services subsidies were down nearly 19% on the previous year.

It did report an operating profit of $2.9m.  It had staff of 18,213 down by  935 on the previous year (Kiwirail has around 4,500 staff today).  While road services and ferry revenue were up, rail revenue was down. 

Rail freight tonnage remained similar to the previous year (increase of 1% in net tonne kilometres although total tonnes hauled was down slightly), but revenue down 8% due to the price pressures of competition. Average distance hauled was 307km. 

The major restructuring evident in this report is consolidating the organisation into three businesses:

• Freight
• Passengers
• Property

This is a marked change from the structure in the Departmental days which was focused not on markets, but on input, such as Way and Works for tracks and associated infrastructure, and the like.  Freight focused obviously on moving goods, but included the rail, road and rail ferry operations.  Passenger included the passenger rail and Railways Road Services passenger operations. Property covered the land and buildings owned by the Corporation, noting the holding of 24,000 hectares of land.

Highlights from the Annual Report included:

• The launch of Doorrail, offering door-to-door delivery of goods, mode neutral.  So freight would go from customer to end user. 
• Sale of the two oldest Cook Strait Rail Ferries (Aramoana and Aranui) after their replacement by Arahura, noting only 4% of sailings were interrupted by weather, industrial action and urgent repairs.  Also noted was increased competition on Cook Strait.
• Continued work on electrification of the North Island Main Trunk line
• Wagon fleet reduced by 5% (to haul similar amounts of freight) as did the locomotive fleet (predominantly due to scrapping some shunting locomotives and tractors). 
• Earlier predictions that competition would mean Railways losing "small-lots" of freight and keep mainline bulk and large scale shipments were wrong, with road freight operators focusing on the larger volumes, not the small ones.  This had stretched the Corporation's resources in sales and marketing.
• $8m worth of land sold, mostly residential to staff in Railway's staff houses. Noting the central Hamilton property development scheme (built on top of the former underground railway station in Hamilton).
• Passenger business noted the opening up of competition to new road coach services, which saw Road Services launch new routes, with new Auckland-New Plymouth, Auckland Napier- Napier-Bulls and Picton-Christchurch services).  Success of new Volvo coaches for comfort and reliability was noted.  It was also noted that catering services were provided at 19 locations across the country, noting facilities at most locations operated at unusual hours for short intense periods of activity (e.g., serving trains with no on-board catering that stop for refreshments. At the time this included Taihape, Palmerston North, Napier, Kaikoura, Springfield and Otira). 
• Book value for the assets was around $925m, which was essentially original cost minus depreciation, and bears little relationship to the market value of those assets.
• Long distance passenger rail patronage dropped by 11% compared to the previous year.
• Suburban passenger rail patronage rose by 5.6% compared to 1984 (continuing to reflect the improvement in reliability and comfort with the Ganz Mavag rail units in Wellington)
• Long distance passenger road services patronage dropped by 4.5% compared to the previous year.
• Suburban passenger road services patronage increased by 1.9% compared to 1984

Part of the Chairman's commentary noted that there are "ambivalent" views of Railways, with some expecting taxpayer funding of services, others thinking it should operate commercially, and the need for the Corporation to work through the various issues in different fields of activity.  

This was an increasingly difficult time as the Railways Corporation would be transformed in the following years, and have the burden of the debt of the North Island Main Trunk electrification (which would not generate sufficient savings to even begin to pay down the debt for the project) and restructuring to make it profitable.

Introduction of the Bay Express

 

In 1989 the introduction Bay Express completed the series of upgrades of long-distance passenger rail services under the Intercity brand, following the one-off bulk funding of the Railways Corporation to place the long-distance passenger services on a sustainable footing after the ending of the Social Services subsidies programme that had operated from 1982 until 1987.  The Bay Express saw the introduction of new more comfortable seating, pressure ventilation (not air conditioning, but it enabled the end of opening windows to cut noise and dust), large panoramic windows and crucially, on board catering at a commercially sustainable scale (with a buffet bar to purchase snacks, meals and drinks to take back to one's seat). It also included a panorama car at the rear to essentially sit and lounge viewing the scenery.

The Tranz Alpine and Coastal Pacific trains had already significantly upgraded the Christchurch-Greymouth and Christchurch-Picton services successfully, with the Southerner refurbished (albeit with higher density seating) to make it commercially viable (as the original Southerner had rarely been so, as the 30 seats per car low density old first class seating simply meant not enough seats could be sold at the fares offered to cover operating costs). 

The Bay Express marked the removal of the last long-distance passenger train that did not have on-board catering, and was dependent on a refreshment stop (at Palmerston North). The aim was to recapture some of the atmosphere of the former Endeavour service which operated from 1972 until 1981, when it was reallocated to the daytime North Island Main Trunk service as a stopgap, following the fatal Waiouru Silver Fern crash.

 

Below is a series of articles on 10 December 1989 reporting on the service commencing the next day. Unfortunately, the Bay Express suffered a decline in patronage from the late 1990s, as domestic airfares became progressively cheaper in real terms, and following the cut in private car prices due to the removal of protection of the local car assembly industry (which reportedly saw the cost of new cars drop on average around $5,000 at the time, cascading the cost of used cars significantly). It was cancelled in 2001 with the last service operating on 7 October (and I did happen to ride it that day!). 

The Evening Post below reported that it cost $350,000 to refurbish three carriages (56ft cars dating from 1937-1945) for the service with new larger windows, sheepskin covered seats and a full bar and buffet meal service (meals available to be taken back to passengers seats).  It was noted that patronage on the Tranz Alpine had increased 50% with the upgraded service. The report also noted the Railways Corporation had introduced computerised reservations for rail and coach services.

The clipping below also from the Evening Post pictured the refurbishing of the panorama car at the Addington Railway Workshops in Christchurch. This ended up being one of the last major pieces of work undertaken at Addington, as it ended up being the second of the major railway workshops closing (following East Town in Whanganui) in 1990 (as it was thought the South Island could not justify having two workshops). 

On 9 December, the Evening Post ran an advertising feature highlighting the train with a series of articles below.

This first article focuses on the work done to refit the carriages, noting that the buffet/panorama car has 24 seats, with food described as including:  "scones served with strawberry cream, lamburgers with stuffed potato and coleslaw, and cold roast chicken and vegetables. Tea and coffee served with all meals, with a fruit salad and New Zealand cheese selection available". The pressure ventilation system is described noting it would change the air in each car once every minute. 

This article noted the construction of the line in the 19th century, noting that although the private Wellington and Manawatu Railway Company had built a line from Longburn to Wellington in 1886, the line in Hawke's Bay went from Napier to Woodville by 1887, with the Manawatu Gorge line opening in 1891. It was noted that the rail journey then took 11 hours as passengers had to change trains twice until in 1897 the Government Railways had built the Wairarapa line from Wellington, albeit over the Rimutaka Incline removing the change of trains, but adding an hour for crossing the Remutakas.  After the Government purchase of the Wellington and Manawatu Railway Company, services were redirected through the Manawatu.

The Dominion's feature contained similar content, such as this article noting the service commencing on Monday 11th

This accompanying article with a photo of Fiat 88-seat articulated railcars passing at Opapa in the 1960s adds history about the service beyond the article above. It notes that in 1939 the introduction of Standard Railcars on some services cut journey times to five hours and 23 minutes, as the steam expresses were taking seven hours 32 minutes (no doubt in part due to the need to replenish water regularly, as well as the faster performance of the railcars).  The articulated railcars (pictured below) operated the route from 1955 until 1972 (when the unreliability of the railcars was putting pressure on the fleet), when the Endeavour train was introduced, much in the style of the Southerner, with a full service buffet car, with restaurant style meal service, and all cars being ex. first class cars offering a low density 1-2 configuration. 

The Endeavour's problem was that during off-peak periods patronage was low and the buffet car was costly and little utilised, so the buffet car was withdrawn in 1981, returning refreshment stops at Palmerston North, but the whole train was removed later than year to replace a Silver Fern set. From then until 1989, the Wellington-Napier service had become the Wellington-Gisborne express.  The Wellington Gisborne express had had three different sets of rolling stock after withdrawal of the Endeavour, with initially ex. second class 56ft cars (with uncomfortable hard vinyl bench seats), followed by Ac class cars in 1982, subsequently replaced by refurbished 56ft cars with a low-cost but acceptable basic seating configuration from 1984.  The damage to the Napier-Gisborne line due to Cyclone Bola, saw the Napier-Gisborne leg of the train curtailed and never replaced, as patronage was low, and removing it enabled the service to be operated by one train set operating return a day instead of two.  The Bay Express was to follow in 1989, giving the route a boost.

The advert at the top of this page is replicated larger below for reading, and appeared in both the Dominion and Evening Posts across two pages:

In 1990, this ad appeared in a free advertising paper distributed in Wellington, promoting the train, with an image of it on the Paremata railway bridge, noting the on-board service and coach connections to Gisborne.

NZR article on NIMT electrification

On 26 June 1986, the Evening Post ran a "Transport Review" segment focused on freight, below is the one page (minus ads) on the North Island Main Trunk electrification project (Te Rapa to Palmerston North) that was underway at the time.

Key points made were:

• Electrification was considered in 1949, 1950, 1954 and 1973
• Cabinet in 1981 approved the project
• At the time nearly half of all freight carried by rail was between Hamilton and Palmerston North
• The line was predicted to be saturated with traffic, restricted by the number of trains that could operate on the single tracked line and the power of diesel locomotives available at the time
• $10m was being spent at the time on easing curves and realignments to make maximum use of the speed increase available from electrification (enabling 1200 tonne trains at 40 km/h). 
• The total cost at the time was estimated to be $200m (it turned out to be around $360m).
• Stage one of the project (Palmerston North to Taihape) was well advanced, with work starting on stage two. Full operation was scheduled to commence in June 1988 (and it did).
• Noted was the installation of fibre optics for communications, because the conventional overhead railway copper wire signalling system would face interference from high voltage AC current. 
• Five level crossings were removed between Palmerston North and Feilding.

Ultimately, the project would require the Government to write off the debt, as the predicted demand did not ensue, not least because in 1982 the deregulation of land transport meant competition from road freight would reduce pressure on the network. In essence, the Railways Corporation would never save enough from lower train operating costs to offset the cost of capital for the project. Part of the restructuring of the Railways Corporation into NZ Rail Ltd in 1990, was the writing off of the debt for this project (in that it was taken over by the Crown in exchange for shifting the rail business into the new SOE).

 

New Zealand Railways Timetables of Principal Services for Tourists and Holidaymakers: 1 May 1984 - 3 November 1984 and to 30 April 1985

I know some people find timetables boring, so I have decided to post the next two covering the 12 months from 1 May 1984 to 30 April 1985, together because they have few real differences. This is a time of relatively little change for the Railways Corporation, given the Booz Allen report had been released, but the change of government from the 1984 General Election had not resulted in any major changes in policy as of yet. That was to come.

I am posting the same pages from each timetable in sequence so you can see what any differences are, as you will see above, the covers are virtually identical except for the dates.

Below, the inset has changed with a more colourful advertisement for Road Services depicting the front of the new Volvo B10M coaches including the reclining seats, which is much more of interest than the back of the coach. It also isn't focused on overnight like the previous ad.

The Northerner and Wairarapa services (including the Wellington-Masterton-Woodville-Palmerston North train) remain largely unchanged between the two periods.

The Wellington-Gisborne express is also largely unchanged. Of note for the Silver Fern is the first timetable reports the end of the "Blue Fern" locomotive hauled service on Wednesdays with the completion of the refurbishment of the Silver Fern railcars (one having been repaired after an accident, and it was decided to refurbish them all).  This also saw the end of Saturday Silver Fern services. The second timetable only has the Monday to Friday service.

The South Island rail services and the ferries are largely unchanged, although the Christchurch-Greymouth express is retimed to be on a slower schedule, 25-30 minutes slower depending on the direction of travel. It is unclear why.

The beginning of the Road Services section is largely unchanged between the seasons

Few changes also on the Northland pages of the Road Services timetables

The Auckland-Whangarei routes are largely unchanged, as are the Auckland-Wellington services, but the addition of Auckland-New Plymouth is new. with a daylight and an overnight service weekdays.

Auckland-Gisborne, Auckland-Tauranga, around East Cape and Hamilton-Tauranga largely unchanged

Coromandel, Tauranga-Wellington and Auckland-Napier services are little changed, but Wellington-Napier coach services have been added here, being an evening service from Napier to Wellington and an early morning service from Wellington to Napier (likely being parcel service based).

Wellington-New Plymouth services are moderately expanded, but the Masterton-Wellington coach services are mostly unchanged. Notable in the South Island is the extension of Christchurch-Kaikoura to Picton once a day, so there is an overnight Christchurch-Picton service and a morning departure from Picton, to meet different ferry services from the rail service.

The Christchurch-Dunedin-Invercargill trunk services have hardly changed, neither have the services over to the Glaciers from Christchurch or the top of the West Coast.

In Otago, there are some minor changes such as additional services on some days between Dunedin and Wanaka, but otherwise the network remains largely unchanged.

On the last pages the only change of note is that the second timetable depicts new coach routes between New Plymouth and Auckland, Wellington and Napier, and Picton to Christchurch.