Final Report

TASKS TO SUPPORT THE DEVELOPMENT ANDCALIBRATION OF TRAFFIC COSTING MODELS

Prepared for:

MACEDONIAN RAILWAYS

AND

THE WORLD BANK

Victor Alalouf September 2001

TABLE OF CONTENTS Page

1. INTRODUCTION AND SUMMARY 1

1.1. Purpose and Applications of a Traffic Costing system 11.1.1. Freight Tariff Setting 21.1.2. Passenger Tariff Setting 21.1.3. Branch Line Evaluation 31.1.4. Investment Decisions 41.1.5. Freight Profitability Monitoring 41.1.6. Public Service Obligations 4

1.2. Issues Related To Costing Concepts And Methodology 51.2.1. Variable, Fixed and Surplus costs 51.2.2. Financial and Capital Costs 71.2.3. Infrastructure costs 81.2.4. Costs and Revenues by Line 9

1.3. Main Characteristics of the Costing Model 101.3.1. The Fixed Input Tables 111.3.2. Interactive Mode and Batch Mode 121.3.3. Structure of the Costing System 12

1.4. Conclusions and Recommendations 13

2. COSTING PASSENGER SERVICES 33

3. COSTING FREIGHT SERVICES 46

4. INPUT TO THE COSTING MODEL 53

4.1. Calculation of Workloads and Costs - Overview 53

4.2. Switching Information 54

4.3. Train Information 55

4.4. Car Utilization 55

4.5. Energy Consumption 55

4.6. The Unit Cost Table 55

1. Introduction and Summary

This Final Report is submitted pursuant to a contract entered into on 20 November 2000, between Macedonian Railways (MZ) and the Consultant. The services to be provided by the Consultant are specified in the Terms of Reference, titled Tasks to Support Development and Calibration of Traffic Costing Models.

The primary objective of this project is to provide the railway with the means to calculate the variable cost of any block of traffic. Such a capability, to be afforded through the establishment of a costing system and the relevant training of local staff, is intended to be support pricing, marketing and investment decisions, as well as to serve as a basis for determining the need for, and level of, government compensation for public service obligations (PSO’s). The following specific tasks are implicit in the above statement of objective:

To review the MZ sources of data to determine their suitability for a route-specific costing system;

To assist MZ in the use of the model to analyze the profitability (contribution over variable cost) of the significant elements of traffic, defined in terms of line segments and commodity groupings for freight traffic, and in terms of line segments and type of service for passenger traffic.

To write the Terms of Reference for improvements to the quality of traffic costing as new data become available with the development of the Management Information System (MIS).

This Introduction provides:

A discussion of the purpose and applications of a traffic costing system;

A discussion of issues related to costing;

A discussion concepts and methodology;

A general description of the costing system installed at MZ;

An account of the work accomplished in this study, and the work remaining to be done.

Sections 2 and 3 of this report describe, through illustrative examples, the calculation of passenger and freight costs. Section 4 describes the inputs to the costing model and their interrelationships, and offers recommendations for enhancements to the input. Finally, Appendix A contains the Terms of Reference for improved traffic costing in line with the improved information to be available as the MIS is developed.

1.1. Purpose and Applications of a Traffic Costing systemThe purpose of a traffic costing system, as opposed to other types of costing work, is to calculate the cost of a traffic movement or a block of traffic movements. Other types of railway costing systems are designed to record the cost of specific railway activities, such as locomotive or car maintenance, track maintenance, shunting activities, etc. Traffic costing, on the other hand, is designed to measure the total cost of all the activities that are combined to develop the end product that the railway sells to its customers, namely, a traffic movement from a given origin to a given destination.

The accounting system is a major input to the costing process, but it cannot determine the cost of a movement through a direct recording of expenses. At best, the accounting system can record the cost of each activity, such as track maintenance, car maintenance, station activities, etc. But each activity, no matter how narrowly defined, serves a large number of movements. The cost of each activity must therefore be allocated to the various traffic elements served by it. The cost of a movement is then obtained by adding up the costs attributed to it in each of the activities contributing to the movement.

The manner in which such allocations are performed will be discussed below. However, it is useful first to consider the ultimate purposes of the system.

1.1.1. Freight Tariff SettingIn a competitive economy, the railway sets the tariff as high as the traffic can bear without undermining its viability. Having established or estimated the maximum rate that the customer is willing to pay, the railway must then determine whether that rate covers its own cost. The relevant cost for that purpose is the variable cost, that is, the incremental cost that the railway would incur by taking on new traffic, or the cost it would avoid by relinquishing it.

Traditionally, the railways have used the net tonne-km as a measure of freight traffic volume, and the cost per net tonne-km as a cost indicator. However, the cost per net tonne-km is extremely variable from one traffic category to another. It depends on innumerable variables, such as the car type, the load per car, the empty return ratio, the utilization of freight cars and locomotives, the train size, the type of power used, the terrain it travels on (hence the fuel consumption rate), the switching requirements, and many other factors. With the advent of highway competition came the increasing need to differentiate among traffic categories by considering many of the foregoing factors in the cost calculations.

Currently the railway is moving from general rate scales to an increased use of contract and special rates. That process should be guided by cost information. Potential new traffic identified by the marketing process may have cost characteristics significantly different from the average. With the costing system, all significant operating characteristics of the proposed traffic can be specifically accounted for in the evaluation of the traffic.

Table 1-1 at the end of this section provides an overview of freight traffic in 1999, and Table 1-2 shows the trend in freight traffic volume since 1981. As seen in Table 1-1, international traffic makes up the bulk of the railway’s freight business, with local traffic representing only 8% of the total by tonnage and 4% by tonne-kilometres. Table 1-1 shows a 60% decline by tonnage and a 45% decline by tonne-kms since 1981, the disparity between the two being associated with a 37% increase in the average haul. This may be an indication that another force is at work beyond the political upheavals of the last decade, namely, the loss of short-haul traffic to the competition. The costing system should help the railway determine what rate action, if any, it should take to recapture that traffic.

1.1.2. Passenger Tariff SettingThe costing issues mentioned above in connection with freight traffic apply equally to passenger traffic, where a common measure is the cost per passenger-km. Again, that

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cost varies with the number of passengers per car, the number of cars per train, the utilization of equipment, etc. Table 1-3 provides an overview of the railway’s passenger traffic in 1999. In contrast to freight traffic, local passenger traffic represents the bulk of the passenger volume. According to Table 1-2, however, international traffic was far from insignificant before 1990. This points to the potential for a resurgence of international passenger traffic if and when the political situation stabilizes.

A distinguishing characteristic of passenger traffic is that passenger costs respond primarily to the level of service provided, that is, the number of train trips and the number of cars on each train. Whereas for freight traffic the railway can adjust its freight car-kms and train-kms more or less continuously to the tonnage, it has to operate a fixed passenger train schedule to provide a minimum acceptable service level regardless of the number of passengers. Currently, the railway carries 20 passenger kilometres per passenger car-kms. This indicates that there is room for a significant increase in the number of passengers at a very low incremental cost.

The costing system is designed to determine the cost of a passenger service once the main service parameters are specified: the number and type of cars, the type of power, the frequency, etc. It makes it possible, consequently, to test alternative service configurations.

1.1.3. Branch Line EvaluationThe economic evaluation of a branch line involves answering the question: what would be the effect on the railway’s total costs and revenues of abandoning the branch line?

First, we consider the case in which the branch line is a stub end (i.e. there is no bridge traffic over the line), and all the traffic is lost in the event of abandonment (case 1). In such a case, abandonment has the following consequences:

a) The railway loses the revenue generated by the traffic originating or terminating on the line;

b) The railway saves the variable cost of the traffic originating or terminating on the line;

c) The railway saves the infrastructure costs of the branch line.

The branch line profit or loss can then be defined as a) – b) – c). Figure 1-1 presents the process graphically.

Secondly, we consider the case where the traffic is not lost on abandonment but is merely diverted to the junction (case 2). In other words, traffic originating or terminating on the branch would, upon abandonment, originate or terminate on the junction between the branch line and the main line. In such a case, abandonment has the following consequences:

a) The railway suffers a revenue reduction as a result of hauling the traffic to and from the junction instead of the branch line, since the railway must compensate the shippers for their additional cost of hauling the traffic to the line;

b) The railway benefits from a reduction in variable cost as a result of hauling the traffic to and from the junction rather than the branch line;

c) The railway saves the infrastructure cost of the branch line.

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In either case 1 or case 2, it is necessary to calculate the variable cost of the traffic, not only over the branch line itself, but over its entire haul from origin to destination. In case 2, it is moreover necessary to determine the costs and probable revenue to and from the junction. The batch capability of the costing system makes it possible to process a large volume of freight traffic one car at a time, taking into account the specific routes and operating characteristics of each car.

On some branch lines, passenger service is a significant or even overwhelming proportion of the traffic. Confining ourselves, for the sake of simplicity, to the case 1 scenario, we can consider three elements of the branch line economic condition:

a) The infrastructure cost of the line;

b) The contribution over variable cost of the freight traffic (over the entire haul); this item is presumably positive, assuming that the railway has the freedom not to carry the freight traffic at a loss;

c) The contribution (usually negative) over variable cost of the passenger traffic.

If the sum of a) and b) is negative, then the branch line is clearly uneconomic, since the presence of passenger traffic can only make it worse. If b) is negligible, either positive or negative, then the only justification for the line is the passenger service. The infrastructure cost can then be considered as part of the passenger service cost.

1.1.4. Investment DecisionsInvestment proposals are justified either on the basis of operating economies or on the basis of providing capacity for new traffic. An example of the latter is the proposed purchase of new freight cars to accommodate new traffic or to sustain the existing capacity as cars reach the end of their lives. Before purchasing new cars in a given pool, it is worth examining the traffic making use of that pool, to determine whether each shipper covers the variable cost of its traffic. If any shipper does not, then his rate should be raised. If the railway loses some traffic in the process, then that loss is beneficial to the railway because it obviates an immediate need to acquire new cars.

Generally, any investment that can be associated with a specific segment of the railway’s business should be subjected to such a test.

1.1.5. Freight Profitability MonitoringThe railway needs to monitor, on a continuous basis, the profitability of specific segments of its freight business. The batch capability of the costing system now makes it possible to determine the cost of large volumes of traffic without any loss of specificity.

1.1.6. Public Service ObligationsThe first three of the applications mentioned above (freight tariffs, passenger tariffs and branch lines) lead naturally to the issue of PSO’s. Purely financial considerations may, from the railway’s point of view, warrant raising the tariffs on a particular traffic at the risk of losing it, or discontinuing a passenger service, or abandoning a branch line. Based on economic, social or other considerations, however, the government may view such actions as inimical to the public interest. The government may then wish, in such specific cases, to curtail the railway’s freedom to act according to its own commercial interests, and make a compensatory payment to the railway.

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Potentially, PSO payments could fall into two categories:

Non-compensatory freight rates;

Unprofitable passenger services;

The subject of government payments for uneconomic branch lines (see Section 1.1.3) is implicitly dealt with in a separate study, Infrastructure Assessment and Development of Investment and Maintenance Plan for Macedonian Railways (the Infrastructure Study).

Non-Compensatory Freight RatesPSO payments for non-compensatory freight rates arise when the rate for some traffic does not cover variable cost. If the government chooses to prevent the railway from raising the rate to the level of the variable cost, then the PSO payment should compensate the railway for the difference between the variable cost and the tariff permitted by the government.

Unprofitable Passenger Train Services

The cost of passenger traffic can vary a great deal from one service to another. The revenue can also vary considerably according to the utilization. Finally, the benefits, from the government’s point of view, can also display large variations resulting primarily from differences in the availability of alternative transportation: the better the alternative, the lower the benefit of a train service.

Given such variations, there is no need for the government to adopt a wholesale position with regard to passenger service. In the search for ways to reduce the cost of passenger rail service, one option is to discontinue specific passenger services whose benefit/cost ratio is particularly low. Initially, a PSO agreement should cover all passenger services. Over time, however, MZ should keep track of the costs and revenues of individual services. It may well happen that no discontinuance is warranted, but no such conclusion can be drawn without knowledge of the costs.

1.2. Issues Related To Costing Concepts And Methodology

The computer model installed at MZ is generic and can accommodate almost any costing concept. The choice of concepts is exercised through the input tables. The model itself has been installed on a MZ computer and is fully operational. However, a number of conceptual as well as practical issues have to be resolved before completing the input tables that drive the model.

1.2.1. Variable, Fixed and Surplus costsAll the costing applications that we have discussed so far require us to measure the change in the railway’s total cost resulting from a change in the traffic level. This implies that costs relevant to these applications are the variable costs.

The starting point in identifying variable and fixed expenses is the accounting system. Table 1-4 presents a statement of expenses and revenues published by the Accounting Department. The income statement presents a matrix of expenses with the departments horizontally, and the input categories vertically. A major task in the development of the costing input is to obtain a breakdown of each of the expense items in the income

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statement into smaller elements suitable, among other things, for the separation of fixed from variable costs.

The accounting system, no matter how detailed, cannot provide a complete separation of fixed and variable costs. The most obvious example is track maintenance. Track maintenance expenses rise with the level of traffic, but clearly not in the same proportion: when traffic increases by, say, 10%, maintenance costs increased at something less than 10%. There are two reasons for this. One is that there are elements of cost that do not vary with traffic, such as vegetation control and inspection. The other is that, as the traffic volume increases, there are greater opportunities for efficiency gains through technology. The first of these two reasons argues for a straight line or a curve with a positive intercept. The other implies a cost curve with a declining slope. In normal costing practice, however, it is common to use a straight line with a positive intercept as an approximation to the ”true” cost curve. A frequently used method of separating fixed from variable costs is regression analysis. Figure 1-2 illustrates its use in the analysis of track maintenance expenses. The use of regression analysis requires a breakdown of expenses and statistics by geographical units. The statistics required are those of the variable to which the expense item is causally related. In the case of track maintenance expenses, gross tonne-kilometres were chosen as the most suitable variable. The dotted curve in Figure 1-2 is the hypothetical “true cost” curve, which is unknown. The solid straight line is the approximation computed by plotting the expense and statistical data.

Available data did not permit extensive use of regression analysis. The technique was applied to only one other item of expense, namely station employees. For other expenses, the accounting information was broken down as finely as possible, and a separate estimate of variability was made for each component, based on experience with other railways.

In the case of MZ, the use of historical data has limitations. One such limitation is the possibility of excess assets and personnel as a result of the sharp and rapid traffic decline, to which the railway may or may not have fully adjusted. To the extent that there is a surplus, it is reflected in the accounting system, and undermines it as a basis for the calculation of variable cost.

Total traffic, measured in traffic units (passenger-kms + freight net tonne-kms), has declined from 1,241 million in 1990 to 522 million in 1999. In the same period, the number of employees has declined from 6.024 to 4,100. So, while traffic has declined by 58%, the number of employees has declined by 32%. It is normal for expenses to drop less than traffic, because of the presence of fixed costs. A simple calculation shows that these relative reductions in traffic and labour imply a fixed labour cost equal to 45% of total labour. This is not unreasonable for a railway whose traffic density was relatively low even before the decline. According to this test, therefore, the railway’s personnel reduction is not obviously inconsistent with its traffic reduction.

However, the level of personnel may have been too high to begin with. This hypothesis can be tested through a comparison with other railways, the results of which appear in Figures 1-3, 1-4 and 1-5. Each of these figures presents a plot, based on several European railways, relating the number of employees of a given type to some measure of density. The pairs of variables are as follows:

Figure 1-3: Total employees per kilometre of line vs. train-kms per km of line

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Figure 1-4: Permanent way employees per kilometre of line vs. gross tonne-kms per km of line

Figure 1-5: Traffic and movement employees per kilometre of line vs. train-kms per kilometre of line.

A regression line based on the Western European Railways is drawn in each of these figures. The position of Macedonian Railways relative to that regression line provides a measure of the amount of excess labour.

In the first two figures, MZ personnel is about twice the number predicted by the regression line. In Figure 1-5, it is about 20% higher.

It should be stressed first that this analysis does not imply that MZ can achieve, without significant investment, the personnel efficiency level of Western European railways. The primary purpose of this review of the personnel level is to estimate the variable cost parameters. It matters little, for the purposes of the costing system, whether the remaining costs are labelled “fixed” or “surplus”: one must assume that the number of surplus employees will not rise in response to traffic growth. Therefore, in the informal process that led to the variable cost input to the model, there was no effort to separate the non-variable cost into fixed and surplus elements.

Figure 1-6 illustrates the argument just presented. Line A represents the long-term cost function. At each traffic level, Line A shows the cost level once all the inputs (labour, assets, etc.) are optimally adjusted to that traffic level. Generally, when traffic increases, the cost rises reasonably fast. However, when the traffic level drops, the railway cannot immediately dispose of the resources made redundant by the traffic loss.

Line B represents the short-term cost function. At today’s traffic level T1, the cost is C1, higher than predicted by the long-term cost function. If traffic increases again, line B shows the cost rising towards C1. The marginal cost (the slope) of line B is less than that of the long-term function, since the railway can draw upon redundant resources at no incremental costs.

In the case of labour expenses, line B is probably flat, since the railway can accommodate a large increase in traffic without increasing its personnel level. The same is not true of cars or locomotives. While there is plenty of surplus equipment, it cannot be brought into service without some rehabilitation work. The incremental cost in this case is therefore the rehabilitation cost, up to the point where the supply of surplus equipment is exhausted.

These considerations may seem theoretical, but they have a major bearing on the railway’s pricing policy. If there is demand for transportation at a price that covers the short-term variable cost, but not the long-term variable cost, the railway should probably accept it. However, the railway must monitor its rates carefully to ensure that the short-term pricing policy does not lead to traffic growth beyond that which can be handled with surplus resource.

1.2.2. Financial and Capital CostsThe income statement (Table 1-5) shows total depreciation costs of 346.8 million denars and financial charges of 778.0 million denars, for a total of 1,124.8 million denars, or 36% of total expenses. Major sources of financial charges are detailed in Table 1-5.

Financial and other capital-related costs are frequently viewed as quintessentially fixed, since they usually result from long-term commitments from which it is difficult to

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disengage once committed. In another sense, however, these costs are quite variable. When traffic increases, the railway must acquire new assets. This acquisition generates new depreciation and financial charges. In other words, these costs are variable with increases but not with decreases in traffic. In addition, there is the complication, alluded to in the preceding section, of surplus assets, as a result of which the costs that are variable with traffic increases are the costs of rehabilitation, not the cost of purchasing new equipment.

In conclusion, there is no application to which the historical financial costs are relevant or even an acceptable surrogate for the marginal cost. Historical financial costs are prone to too many variations that will not necessarily repeat themselves in the future. Some of the causes of such variations are the timing of past investments and the vagaries of foreign exchange. For the major assets, therefore (freight cars, passenger cars, locomotives, motor units) we have constructed financial costs based on estimates of asset requirements. Two versions of the cost were calculated: one based on the purchase price of a new asset, and one based on the rehabilitation cost of an asset. These calculations are displayed in Tables 1-6 and 1-7 respectively.

1.2.3. Infrastructure costsThe infrastructure cost input to the model has been calculated on two bases. First, the Track unit (ZOP) and the electro-technical unit (ETP) are treated as part of the same entity as the rest of the railway. In this case, the costs used in the model are the costs incurred by those units. This will be referred to as case 1. In the second approach, ZOP and ETP are treated as a separate infrastructure unit. The costs are then defined as the payments by the operating unit of the railway to the infrastructure unit (case 2).

In case 1, the costs are determined as follows. For track expenses, we used the results of a regression equation relating the number of Track Department personnel per gross tonne-km to the density in gross tonne-kms per kilometre of line. (See Figure1-2. This regression equation was used to derive a variability percentage for labour costs. This percentage was then reduced to account for the existence of surplus personnel.

For materials expenses, a variability of 100% was applied to 1999 expenses. This could be an understatement to the extent that any maintenance deferral was not considered. But there are two aspects to the problem of tax deferral. The first relates the “catch-up” cost, that is, the cost of bringing the track up to the level at which it should be. That cost is not directly relevant to the purposes of the costing system. What the model requires is a measure of the variability of long-term normalized maintenance with traffic. If the cost of rehabilitating the line is unavoidable regardless of the traffic level, it is fixed, and therefore not relevant to any rate-setting decisions.

The second aspect of the maintenance deferral problem is its bearing on the relevance of historical data. Maintenance deferral implies that the maintenance level is below what it should be. If that is the case, then cost calculations based on historical data are understated. It is expected that the Infrastructure study will resolve this issue. Any new information released by that study can, with no difficulty, be incorporated into the costing model. ETP costs are largely fixed and, strictly speaking should not be included in the costing model. However costs do not provide unlimited capacity. As a general rule traffic should be charged for the use of capacity when there is a fixed amount, as a means rationing its use. We have estimated that the total capacity of electrified lines is 7 million train-kms, and have produced a cost per train-km of capacity to be applied on electrified lines.

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This method implicitly defines a “fixed” cost, since the unit cost per train-km of capacity is applied to the actual, lower, train-kms.

The case 2 method is one in which the Track and ETP functions are a separate unit, and the cost is the payment by the operating company to that unit. The Infrastructure draft final report recommends payments on a gross tonne-km basis. These are readily integrated into the costing model input.

1.2.4. Costs and Revenues by LineThe model requires, among other things, the parameters of a cost function, that is, a set of linear equations relating each item of expense to one or several variables. The primary purpose of this cost function is to make it possible for the model to determine the cost of any movement. A by-product of the cost function is the ability to produce a breakdown of expenses into freight, passenger and fixed components. This calculation requires the use of the input to the model but not the model itself.

We have produced three versions of this table. Table 1-8 provides a breakdown consistent with the expenses appearing in the income statement. Financial charges, in particular, reconcile with the accounting statements, and are allocated to freight and passenger in proportion to the assets. Infrastructure costs are also consistent with the income statements.

Tables 1-9 and 1-10 differ from table 1-8 in that they are based on a modified evaluation of financial charges (see section 1.2.2) and infrastructure costs (see section 1.2.3). Tables 1-9 and 1-10 differ from each other in that they are based on the long-term and short-term financial costs, respectively.

The consultant has reviewed the report titled Program for Restructuring of the Public Enterprise “Macedonian Railways” for the Period 2000-2003, by Dr. Aleksandar Petrovski, dated March 2000 (“the Petrovski report”). Page 38 of that report shows a table of costs and revenues by line.

Following is a comparison of the results of Table 1-7 and those of the Petrovski report:

Macedonian Railways Expenses – 1999 (million denars)

Current Study Petrovski Report

Fixed Costs Not Distributed

Fixed Costs Distributed

Passenger 1,128.3 1,569.8 1,665.3

Freight 737.5 1,493.6 1,512.8

Fixed 1,197.6

TOTAL 3,063.4 3,063.4 3,178.1

The first column is derived from Table 1-8. The last column was obtained from page 38 of the report. The results cannot be expected to be the same since the Petrovski figures are based on a distribution of all the costs to freight and passenger services. However, for the sake of comparison, the fixed costs obtained from Table 1.8 were distributed to freight and passenger services in proportion to the gross tonne-kms of each. The result,

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which appears in the middle column above, is quite close to those of the Petrovski report.

The Petrovski report provides a breakdown of the costs and revenues by line. In this respect, the philosophy and methodology underlying the Petrovski report differ in two respects from those of the proposed costing system. The first pertains to fixed costs. For the purposes of the costing system, given its intended applications, it is necessary to use variable costs rather than average costs, and some effort is therefore made to separate fixed from variable cost.

The second major difference pertains to the traffic entity for which the costs and revenues are ultimately calculated. In the Petrovski report that entity is the line. In the costing applications, the entity is one about which a pricing, marketing or investment decision can be made. That entity is a complete movement from origin to destination or a collection of such movements.

A decision can also be made about a line. However, as we have seen in connection with branch lines (see section 1.1.3), a calculation of the costs incurred on the line, and an allocation of revenue to the line are not a suitable measure of the profitability of the line. The reason, quite simply, is that no decision can be made about one line without affecting traffic flows and revenue over other lines. Confining the cost and allocating the revenue to the line itself does not yield a good measure of, for instance, the consequences of abandoning the line. For example, abandoning the Kocani-Veles line is quite likely to lead to the loss of traffic from Kocani to Skopje, and will therefore have some effect on the Veles-Skopje line. Abandoning the Veles-Skopje line would have a devastating everywhere.

One may, of course, argue that it is not the purpose of a cost-by-line calculation to evaluate the consequence of abandonment. The cost-by-line calculation does have some value, but only as a measure of the efficiency of the line, efficiency being measured in terms of cost per unit of production, not cost per unit of revenue.

1.3. Main Characteristics of the Costing ModelCost Analysis of Rail Transport through Automatically Generated Elements, “Cartage”, is a model designed to determine the cost of a rail transportation move from a given origin to a given destination. The model has three application classes, corresponding to the different traffic entities for which the costs are required: the Carload application, the Trainload application, and the Passenger application.

The Carload application calculates the cost of one carload or of several carloads with identical values of the following parameters:

The origin station The destination station The car type The commodity The load per car The number of cars

The Carload application can also be used to calculate the cost of intermodal cars. To cost intermodal traffic, the model requires, in addition to the above car information, the following intermodal-related data:

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The number and type of intermodal units The intermodal Plan number The contents weight per unit

The Trainload application calculates the cost of a complete freight train movement. In this application, the user specifies a number of parameters defining the composition of the train and its movement. The parameters of the cars within the train are specified in the same manner as in the Carload application. For locomotives, the Trainload application requires the user to specify the following parameters:

The origin and destination of the train The type and number of locomotives The origin and destination of each locomotive

For both the carload and the trainload applications, the user may, optionally, enter additional parameters to override assumptions built into the logic of the model and the fixed tables referred to by the model. In the Trainload application, the user may specify the locomotive hours per trip, the crew wages, the car cycle and the number and type of switching required to handle each group of cars. In the Carload application, the user may specify the car cycle, the car empty return ratio and the intermodal unit days per trip.

The Passenger application is used to calculate the cost of a passenger train trip. It requires the user to specify the following parameters:

The origin station The destination station The passenger car type The service category The number of cars The number passengers per car The number of car-hours per car The type of switching The number of switching minutes per car

Optionally, an additional passenger-related cost per car defined by the user, for example, the cost of catering service.

1.3.1. The Fixed Input TablesThe above type of carload and trainload information defines the traffic for which the cost is determined. It will be referred to as traffic information.

To calculate the cost of a move, the model uses a series of tables that contain information related to:

The rail network

The train characteristics in each link

The switching characteristics at each location

The car and locomotive characteristics

Unit costs related to each of the railway’s traffic measures, or Workloads

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The above tables are applicable to all traffic, and need to be updated only periodically. They will be referred to in this manual as the Fixed Inputs.

1.3.2. Interactive Mode and Batch Mode The Carload application can be operated in either Interactive Mode or Batch Mode. In interactive mode, the user enters the traffic information for one move at a time; the output for that move then appears immediately on the screen, and can be printed or saved in a file at the user’s command. In batch mode, the traffic information for several moves is contained in a file, to be referred as the Traffic File. The model reads the file, calculates the cost of each move, and produces a file containing the traffic information initially entered, the cost of each move, and a number of statistics developed by the model for each move.

The major advantage of the Batch Mode of operation is its ability to calculate the costs of a large volume of traffic move by move and to store the results. The file produced in batch mode can be processed to produce summaries for large aggregates of traffic. This is useful in profitability monitoring and economic analyses involving large volumes of traffic

1.3.3. Structure of the Costing SystemFigure 1-7 describes the structure of the costing system. At the core of the system is the point-to-point costing model itself, which reads the traffic data (on the right), looks up the operating parameters (top) and the cost parameters (left) to produce the cost result. Depending on the input and the mode selected by the user, the output can be a screen display, a printed report, or a computer file.

The model uses 13 input tables to perform its calculations. These tables contain the following information:

1) Network: information that allows the model to determine the route and distance for a specified origin/destination pair;

2) Train characteristics: data regarding the train characteristics on every link in the railway network;

3) Shunting: information regarding locomotive time required at every station and terminal for various shunting operations;

4) Car utilization: car type-specific data on car cycle and empty movement.

5) Unit costs: effectively the cost function of the railway; a table containing unit costs relating each item of expense to one or several variables (the workload variables) that measure the work generated by the railway in the production of a traffic movement

1.4. Conclusions and RecommendationsThe consultant has completed the following tasks:

The initial development of 13 fixed input tables providing location-specific operating parameters as well as cost relationships required for costing;

The testing of the costing system on a sample passenger service;

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The testing of the model on a batch freight traffic file provided by MZ for the first quarter of the year 2000;

The training of two MZ counterparts in the use of the costing model.

The consultant has provided MZ staff with the User’s Manual, and will provide an electronic version of the development of the Unit Cost system, and system of half a dozen Excel files lead into the Unit Cost table, a central input to the system.

In our opinion, the system currently in place is usable but can be very substantially improved at little cost. We recommend that MZ staff be assigned the following tasks:

1. Improve the quality of the fixed inputs to the costing system

2. Develop more detailed information about specific passenger services, in particular, the number of passengers and the revenue;

3. Expand the freight batch file to the entire year, establish a routine to produce and maintain a file on a permanent basis;

4. Develop the means to append revenues data to the freight traffic batch file;

5. Apply the costing system to the entire MZ freight and passenger traffic.

The required improvements to fixed inputs will be discussed in the body of the report. They fall into the following areas:

More specific expenditure data

More specific train data

Shunting data

Better information about empty car movement and car cycles;

It is expected that the improvement to the costing capabilities of MZ will consist of an initial surge of enhancements based on ad hoc studies and existing information, followed by a series of improvements as the new Management Information System affords greater possibilities. Appendix A contains the Terms of Reference for improvements to the quality of traffic costing as new data become available with the development of the MIS.

August 2001 Page 13

Table 1 -1 - Overview of Freight Traffic

Type of Traffic Cars Tonnes NTKm Average haul

Average load per

car

Percent of Total

By Tonnes By NTKm

               

LOCAL TRAFFIC 5,447 177,021 14,784,285 83.5 32.5 8.2% 3.9%

Import 39,515 1,529,280 272,166,302 178.0 38.7 70.6% 71.7%

Export 8,457 345,525 64,589,033 186.9 40.9 16.0% 17.0%

Transit 4,717 113,671 28,131,749 247.5 24.1 5.2% 7.4%

TOTAL INTERNATIONAL 52,689 1,988,476 364,887,084 183.5 37.7 91.8% 96.1%

               

GRAND TOTAL 58,136 2,165,497 379,671,369 175.3 37.2 100.0% 100.0%

August 2001 Page 14

Table 1-2

Freight and Passenger Traffic Since 1980

Year Tons (000)

Ton-kms (million)Haul (kms)

Number of Passengers

(000)

Passenger-kms (million)Distance

(kms)Local International Transit Total Local International Total

1980 6520      -   5471       1981 6749 160 588 118 866 128 5519 203 145 348 63 1982 6797 163 598 138 899 132 6133 230 166 396 65 1983 8511 168 727 101 996 117 6683 246 106 352 53 1984 9102 162 821 121 1,104 121 6678 235 170 405 61 1985 8779 140 852 138 1,130 129 6766 246 171 417 62 1986 8640 140 701 118 959 111 6864 255 181 436 64 1987 7828 122 687 97 906 116 6325 239 173 412 65 1988 7552 82 687 99 868 115 5902 220 165 385 65 1989 7939 96 685 129 910 115 5546 207 164 371 67 1990 6500 51 718 117 886 136 5051 178 177 355 70 1991 5485 189 521 117 827 151 3104 180 24 204 66 1992 3864 104 476 109 689 178 2049 102 11 113 55 1993 3381 97 397 13 507 150 1350 62 11 73 54 1994 1919 88 64  152 79 1257 61 7 68 54 1995 1591 43 126  169 106 1074 58 7 65 61 1996 1804 25 246  271 150 1550 115 5 120 77 1997 2100 22 257 24 303 144 1712 139 2 141 82 1998 2694 13 395 65 473 176 1715 149 1 150 87 1999 2509      -   1662 148 1 149 85.

% Change -60% -92% -33% -45% -45% 37% -69% -27% -99% -57% 39%

August 2001 Page 15

August 2001 Page 16

Table 1-3

Overview of Passenger Traffic Volume

  1998 1999

  Number of Passenger Passenger-kms Distance Number of

Passenger Passenger-kms Distance

             

Total 1,715,454 149,512,729 87.2 1,661,872 149,702,095 90.1

             

Local 1,697,382 148,303,026 87.4 1,654,201 149,118,879 90.1

             

International 18,072 1,209,703 66.9 7,671 583,216 76.0

Figure 1-1

August 2001 Page 17

TRAFFIC THAT WOULD BE LOST IN THE EVENT OF ABANDONMENT

REVENUE GENERATED BY THE TRAFFIC ORIGINATED OR TERMINATED ON THE BRANCH LINE

VARIABLE COST OF TRAFFIC ORIGINATED OR TERMINATED ON THE BRANCH LINE

CONTRIBUTION OVER VARIABLE COST

BRANCH LINE INFRA-STRUCTURE COST

BR

AN

CH

LIN

E LO

SS

August 2001 Page 18

August 2001 Page 19

Total 1999 Traffic Traction Track Mtce ETP HQ Housing IT

5. Wages 907,136 284,019 287,949 147,588 73,300 94,798 5,696 13,786 a) Net 513,078 160,849 162,793 84,334 41,355 52,772 3,213 7,762 b) Fringe benefits and taxes 394,058 123,170 125,156 63,254 31,945 42,026 2,483 6,024

6. Purchase value of goods sold 32,612 10,467 21,190 638 276 41

B. FINANCIAL EXPENSES 778,010 15,302 462,652 167,741 132,005 97 200 13 1. Foreign exchange 639,971 8,988 396,590 109,618 124,468 95 200 12 2. Negative exchange loss 126,580 1,960 58,957 58,123 7,537 2 1 3. Other expenses 11,459 4,354 7,105 4. Reduction in expenses -

C. EXTRAORDINARY EXPENSES 71,500 26,161 36,033 6,363 952 837 1,154 - 1. Write-off of receivables 45,495 18,714 25,580 134 109 115 843 2. Expenses of past years 22,643 6,860 10,442 3,501 843 686 311 3. Additional expenses 3,362 587 11 2,728 36

D. CROSS CHARGES 127,970 43,846 46,429 23,097 11,602 2,507 458 31

II. TOTAL EXPENSES 3,108,442 663,430 1,312,197 584,433 375,899 140,723 9,721 22,039

Total Revenue 2,635,113 783,237 1,494,608 144,694 40,325 140,723 15,678 15,848

Profit (Loss) (473,329) 119,807 182,411 (439,739) (335,574) - 5,957 (6,191)

Page 2 of 2Table 1-4

1999 EXPENSES (000 Denars)

Total 1999 Traffic Traction Track Mtce ETP HQ Housing IT

A.

1. Materials Costs 319,424 27,585 221,823 47,018 12,735 7,773 465 2,025 a) Materials 115,819 3,955 60,235 39,105 7,438 3,611 82 1,393 b) Power 183,789 17,709 154,944 3,555 2,894 3,723 372 592 c) Spare parts 2,011 42 223 1,482 248 16 d) Inventory write-off 17,805 5,879 6,644 4,135 921 191 11 24

2. Services 230,441 63,453 101,325 51,814 2,660 8,078 446 2,665 a) Transport 6,407 1,408 1,837 437 427 2,180 43 75 b) Operations and Investmet 189,664 49,756 84,463 49,916 1,799 1,092 125 2,513 c) Other services 34,370 12,289 15,025 1,461 434 4,806 278 77

3. Depreciation 346,826 99,771 27,681 94,931 121,818 1,709 140 776 a) Amortization 347,586 99,834 27,681 94,931 121,818 2,281 140 901 b) Revaluation of depreciation 1 1 c) Reduction of depreciation of own capital(761) (64) (572) (125)

4. Non-material costs 294,523 92,826 107,115 45,243 20,551 24,883 1,162 2,743 a) Fringe benefits 191,800 57,571 59,876 35,865 16,337 19,064 904 2,183 b) Indemnity insurance 2,581 166 193 2,158 44 20 c) Recourse assistance 31,132 10,352 9,248 6,109 2,129 2,688 164 442 d) Taxes and pension 18,484 6,414 10,213 871 250 700 10 26 e) Axle-km cost 29,995 16,540 13,455 f) Other expenses 20,531 1,783 14,130 240 1,791 2,431 64 92

Table 1-4

Page 1 of 2

1999 EXPENSES (000 Denars)

August 2001 Page 20

August 2001 Page 21

August 2001 Page 22

August 2001 Page 23

Figure 1-6

Long-Term and Short-Term Variable Costs

August 2001 Page 24

TRAFFIC LEVEL Past traffic level Today's traffic level

TOTAL COST

Fixed Cost

Variable cost

Surplus Today's cost level

Long-term marginal cost

Short-term marginal cost Long-term cost function

Short-term cost function

A

B

T1 T2

C1

C2

August 2001 Page 25

Table 1-5

  INTEREST STRUCTURE -1999       1) Eurofina      Ordinary interest Den 141,000,297.00   Deferred interest Den 137,595,539.00          EIB Luxemburg    2) Ordinary interest Den 28,654,184.00   Default interest Den 76,008,474.00   Deferred interest - additional Den 62,526,968.00        3) Radio dispatching - paris club (interest during construction)  Constructional interest Den 6,885,228.00   Ordinary interest Den 1,113,648.00   Deferred interest Den 9,668,163.00        4) IBRD Washington AOB and Ministry    Deferred interest   68,477,258.00        5) World Bank      Ordinary interest Den 680,718.00        6) Spain Train and Paris Club      Agreement of Rescheduling Den 39,332,213.00   Interest during Construction Den 17,097,388.00   Ordinary interest Den 2,802,851.00   Deferred interest Den 16,947,352.00          TOTAL   608,790,281.00          RECAPITULATION      Ordinary Interest   213,583,911.00   Deferred interest   371,223,754.00   Interest during construction   23,982,616.00       608,790,281.00        

August 2001 Page 26

Table 1-6

Capital Costs of Equipment - Long-Term

      Freight cars Passenger cars Electric locomotives Diesel locomotives EMU & DMU motorized cars

EMU & DMU Non-motorized cars

                                               

                

Value of one Unit (USD)   

35,000 80,000 1,200,000 1,200,000 400,000 80,000

Cost of capital rate   

0 0 0 0 0 0

Life (years)   

30 30 30 30 30 30

Capital recovery factor   

0.1061 0.1061 0.1061 0.1061 0.1061 0.1061

Annual cost per unit (USD)   

3,713 8,486 127,295 127,295 42,432 8,486

Annual cost per unit (denars)   

222,766 509,180 7,637,706 7,637,706 2,545,902 509,180

Cost per day (denars)   

610 1,395 20,925 20,925 6,975 1,395

Cost per hour   

25.43 58.13 871.88 871.88 290.63 58.13

Table 1-7

Capital Costs of Equipment - Short-Term

      Freight cars Passenger cars Electric locomotives Diesel locomotives EMU & DMU motorized cars

EMU & DMU Non-motorized

cars

                                               Cost of Rehabilitation (USD)     5,000 15,000 200,000 300,000 80,000 40,000

Net Salvage Value (USD)    5,000 10,000 14,000 14,000 10,000 10,000

Rehabilitation + Salvage (USD)     10,000 25,000 214,000 314,000 90,000 50,000

Cost of capital rate     10% 10% 10% 10% 10% 10%

Remaining Life (years)    10 10 10 10 10 10

Capital recovery factor    0.1627 0.1627 0.1627 0.1627 0.1627 0.1627

Annual cost per unit (USD)    1,627 4,069 34,828 51,102 14,647 8,137

Annual Cost per Unit (denars)     97,647 244,118 2,089,651 3,066,123 878,825 488,236

Cost per Day (denars)    267.53 668.82 5,725.07 8,400.34 2,407.74 1,337.63

Cost per Hour (denars)    11.15 27.87 238.54 350.01 100.32 55.73

Table 1-8

August 2001 Page 28

1999 Expenses and Revenue (000 denars)

           PASSENGER FREIGHT FIXED TOTALTRAFFIC DEPARTMENT        

Including Financial Charges 117,822 215,001 330,607 663,430 Excluding Financial Charges 117,822 208,544 295,601 621,967

TRACTION DEPARTMENT        Including Financial Charges 824,964 283,413 203,817 1,312,195 Excluding Financial Charges 434,462 176,186 165,482 776,130

ZOP        Including Financial Charges 75,198 128,795 380,440 584,433 Excluding Financial Charges 55,873 95,697 258,120 409,690

         ETP        

Including Financial Charges 110,300 110,300 110,300 330,899 Excluding Financial Charges 71,286 27,314 145,018 243,617

OTHER        Including Financial Charges - - 172,483 172,483 Excluding Financial Charges - - 170,182 170,182

         GRAND TOTAL        

Including Financial Charges 1,128,283 737,509 1,197,647 3,063,439 Excluding Financial Charges 679,443 507,740 1,034,403 2,221,586          

REVENUE 130,000 1,329,000 708,000 2,167,000          PROFIT (LOSS)        

Including Financial charges (998,283) 591,491 (489,647) (896,439) Excluding Financial Charges (549,443) 821,260 (326,403) (54,586)

August 2001 Page 29

Table 1-9

1999 Costs and Revenue - Long-term Capital Costs(000 denars)

Passenger Freight Fixed TOTAL

TRAFFIC DEPARTMENT 117,822 452,075 289,241 859,138

TRACTION DEPARTMENT 634,854 299,202 202,917 1,136,974

INFRASTRUCTURE 35,870 257,009 - 292,879

OTHER - - 172,483 172,483

GRAND TOTAL 788,546 1,008,286 664,641 2,461,473

REVENUE 130,000 1,329,000 708,000 2,167,000

Profit (Loss) (658,546) 320,714 43,359 (294,473)

Table 1-10

1999 Costs and Revenue - Long-term Capital Costs(000 denars)

Passenger Freight Fixed TOTAL

TRAFFIC DEPARTMENT 117,822 292,646 289,241 699,709

TRACTION DEPARTMENT 578,650 252,764 202,917 1,034,331

INFRASTRUCTURE 35,870 257,009 - 292,879

OTHER - - 172,483 172,483

GRAND TOTAL 732,342 802,419 664,641 2,199,402

REVENUE 130,000 1,329,000 708,000 2,167,000

Profit (Loss) (602,342) 526,581 43,359 (32,402)

August 2001 Page 31

FIGURE 1-7

August 2001 Page 32

STRUCTURE OF COSTING SYSTEM

August 2001 Page 33

NETWORK TRAIN SHUNTING

PRINTSCREEN DISPLAY

COSTED TRAFFIC FILE

PROFITABILITY REPORTS

EXPENSE DATA

OPERATNG STATISTICS

UNIT COSTS

KEYBOARD

TRAFFIC FILE

August 2001 Page 34

CAR DATA

POINT-TO-POINT COSTING

2. Costing Passenger Services

Table 2-1 shows an exhaustive list of MZ passenger train. To determine the cost of a service, one must select a representative pattern of movements in such a way that the service consists of some whole number of such movements per year. The list describes the station pairs served and the equipment type. The train consist is given in terms of car types labelled as follows:

WLAB: Sleeping carsBC: CouchetteBM: Second-class – 8-seat compartmentsABM First & Second Class – 6-seat compartmentsVR/AR/BR Buffet/RestaurantA: First Class

We can define a “service” as the aggregate of all the train numbers that serve a particular pair of points, for example, Skopje-Kicevo. However, there is another way to define a service, and that is the services provided by one train set. A train set may serve more than one pair of points. For example, one train set runs from Skopje to Kicevo as Train number 6902, returns to Skopje as 6905, runs another round trip to Kicevo as trains 6906/6909, then runs a round trip to Tetovo as train numbers 6910/6911. Conversely, several train sets may serve a single pair of points.

When a train set serves several pairs of points (i.e.. provides several services), one must allocate car time and locomotive time to the various pairs of points. Such allocations are unavoidable: all costing systems are replete with them. They involve tacit assumptions that are valid in most cases, but should be avoided if possible. For example, returning to our example above, suppose that the same train set serves both Skopje-Kicevo and Skopje Tetovo. If we allocate car time to each of the two services, we imply that if, for example, the Skopje-Tetovo service is discontinued, there will be an alternative use for the car time we have allocated to it:

For this reason it may be useful to define services both in terms of train sets and in terms of station pairs served by the train. Figures 2-1, 2-2 and 2-3 show the disposition of train sets. Table 2-2 provides similar information for electric motor units (EMU) and diesel motor units (DMU).

To illustrate the use of the model, we choose the Kicevo-Skopje service. As shown in Figure 2-3, this service is provided by two train sets. One of the train sets, however, also serves the Skopje-Tetovo connection. We will therefore treat the entire operation of the two train sets as one service. Tables 2-3, 2-4, 2-5 and 2-6 display the results of two cost runs. Tables 2-3 and 2-4 show two different formats of the output of a run for trains 6902, 6905, 6906, 6909, 6910, 6911. Similarly, Tables 2-5 and 2-6 show the output of a run for trains 603, 6904, 6907 and 6908.

As stated above, there are two output statements available for each run. The first statement is exemplified by Table 2-3 and 2-5. The first two boxes of these tables display the input. The first boxe shows the locomotive and train data. Each one-way trip is recorded on two lines. The first line of each pair of lines has no locomotive identification; it refers to the train movement as distinct from the locomotive trip. This may seem redundant, but is necessary to identify cases where the same train trip has different locomotive configurations in different sections of its trip. In such cases there could be one line for the train movement and two or more lines for the locomotives.

The locomotive section of the input shows, for each line, the origin and destination of the trip and, in the case of locomotives, the locomotive type and the number of locomotives. The model calculates the number of locomotive-hours for each trip based on the fixed input tables. However, the user may override this calculation by entering the number of hours in the appropriate columns. In the case of Table 2-3, the locomotive performs 4 trips in one day, which works out to 4 hours per trip. An additional 20% was added to account for idle and unserviceable time, for a total of 4.8 hours per trip. In the case of Table 2-5, one locomotive runs 4 one-way trip per day, and it is assumed that the locmotive performs no other work during the day. On a 24-hour day, this works out to 6 hours per trip. Adding 20% yields 7.2 hours per trip.

The car data box provides information about the train consist. As with locomotive information, each line represents a trip by one or several cars of a given type. For each trip, the car data box shows the origin and destination of the trip, the car type, the service as defined by the user,(first class, second class, etc.), the number of cars, the number of passengers per car and the number of car-days per trip. The number of passengers per car is assumed to be 20.

The Output box displays the workloads generated by the movement, and the unit cost of each workload. The total cost is obtained by multiplying each workload by its unit cost, and summing the result.

The total costs shown in tables 2-3 to 2-6 are costs for one complete cycle, of which there are 365 in a daily service. The cost of one cycle must therefore be multiplied by 365.

Train Cost per Trip (denars)

Number of Trips per

Year

Annual Cost (000 denars)

Skopje – Kicego - Tetovo 248,993 365 98,882

Skopje - Kicevo 203,435 365 74,254

It should be noted that the average cost per passenger-km is 4.5 denars for the Skopje-Kicevo-Tetovo train set and 4.3 for the Skopje-Kicevo. This compares with 5.6 denars for the entire passenger service. Part of the reason for the difference can be found in a comparison of some basic statistics between the system as a whole and the train of Tables 2-3 and 2-4 (“the test train”). The system passenger service has 17 passenger-kms per car-kms, whereas the test train has 20 passengers per car.. The system has 4.1 passenger cars per passenger train, whereas the test train calculations are based on 5 cars per train. The combined effect of these 2 statistics is that there are 96 passenger-kms per train-kms on the test train, and 69 over the entire system.

A very significant gap in the above analysis is data on revenue and the occupancy rate. This is the most significant factor in the profitability of a service. We recommend, therefore that revenue data be obtained by individual service.

August 2001 Page 36

August 2001 Page 37

VLA

B

BC

BM

AB

M

VR

/AR

/BR

A DC B AB F

GB

c

WLA

B

BC

BM

AB

M

VR

/AR

/BR

A DC

AB B F

GB

c

334 Skopje Belgrade 441;461 700 1 & 2 0.5 0.5 1.5 2.5 1 2 1335 Belgrade Skopje 441;461 700 1 & 2 0.5 0.5 1.5 2.5 1 2 1390 Skopje Belgrade 441;461 500 1 & 2 0.5 0.5 0.5 0.5391 Belgrade Skopje 441;461 400 1 & 2 0.5 0.5 0.5 0.5392 Skopje Nis 441;461 400 1 & 2 1 1 2393 Nis Skopje 441;461 400 1 & 2 1 1 2410 Bitola Liubliana 441;461 500 1 & 2411 Liubliana Bitola 441;461 500 1 & 2 1 1 1 2 2 1 0.5

441;461 300

441;461 300

441;461 300

441;461 300

441;461 300

441;461 300

441;461 300

441;461 300

441;461 300

441;461 300

MPPM

MPPM

MPM

MPPM

MPPM

MPPM

EMU 412; DMU 71222901 Tabanovci Skopje

MPM

MPM

MPM

MPPM

MZ CARS FOREIGN CARS

Page 1 of 3Table 2-1

Passenger Train Services

Skopje Tabanovci

Tabanovci Skopje

Skopje Tabanovci

Tabanovci

2906

2907 Skopje

2

2

2

2

2

2

2EMU 412; DMU 712

EMU 412; DMU 712

2908

2909

EMU 412; DMU 712

EMU 412; DMU 712

EMU 412; DMU 712

EMU 412; DMU 712

EMU 412; DMU 712

22900 Skopje TabanovciEMU 412; DMU 712

EMU 412; DMU 7122902 Skopje Tabanovci 2

2905 Tabanovci Skopje

2903 Tabanovci Skopje

2904 Skopje Tabanovci

Train Number FROM TO Wagon ClassPowerTrailing Tonnes

EMU DMU

August 2001 Page 38

VLA

B

BC

BM

AB

M

VR

/AR

/BR

A DC B AB F

GB

c

WLA

B

BC

BM

AB

M

VR

/AR

/BR

A DC

AB B F

GB

c

441 300

441 300

441 300

441 300

441 300

441 300

4900 Bitola Skopje 661 400 2 #4901 Skopje Bitola 661 400 2 #4902 Bitola Skopje 661 400 2 #4903 Skopje Bitola 661 400 2 # #4904 Bitola Skopje 661 400 2 # #4905 Skopje Bitola 661 400 2 #4906 Bitola Skopje 661 400 2 #4907 Skopje Bitola 661 400 2 #4908 Skopje Bitola 661 400 2 #4909 Skopje Bitola 661 400 2 # #4910 Bitola Prilep 661 200 2 #

642 643 200

642643 200

642643 200

642643 200

MPPM

MPPM

MPPM

MPPM

MP

MP

MP

MP

#

#

2

5903 Skopje Kocani DMU 712 2

5902 Kocani SkopjeDMU 712

2

5901 Skopje KocaniDMU 712

2

5900 Kocani SkopjeDMU 712

EMU 412 2

SkopjeEMU 412

2

3905 Skopje Gevgelija

2

3902 Gevgelija SkopjeEMB 412

2

3903

EMU 412

Skopje Gevgelija

SkopjeGevgelija

3901

3900

EMU 412

Skopje GevgelijaEMU 412

2

3904 Gevgelija

Table 2-1

Passenger Train Services

Page 2 of 3

2

Train Number FROM TO PowerTrailing Tonnes Wagon Class

MZ CARS FOREIGN CARS

EMU DMU

August 2001 Page 39

VLA

B

BC

BM

AB

M

VR

/AR

/BR

A DC B AB F

GB

c

WLA

B

BC

BM

AB

M

VR

/AR

/BR

A DC

AB B F

GB

c

5920 Kocani Veles 642 2205921 Veles Kocani 642 2206902 Skopje Kicevo 661 400 2 56903 Kicevo Skopje 661 400 2 46904 Skopje Kicevo 661 400 2 4 16905 Kicevo Skopje 661 400 2 56906 Skopje Kicevo 661 400 2 66907 Kicevo Skopje 661 400 2 4 16908 Skopje Kicevo 661 400 2 46909 Kicevo Skopje 661 400 2 66910 Skopje Tetovo 661 400 2 36911 Tetovo Skpoje 661 400 2 37892 Skopje Volkovo 661 180 27893 Volkovo Skopje 661 180 27894 Skopje Volkovo 661 180 27895 Volkovo Skopje 661 180 2

8930 Veles Skopje 2 MPM8931 Skopje Veles 2 MPPM8932 Veles Skopje 2 MPPM8933 Skopje Veles 2 MPM8960 Skopje Kicevo 661 500 28961 Kicevo Skopje 661 500 2

13302 1) Solun Lebeni 461;441 80013303 2) Lebeni Solun 461;441 80013310 3) Solun Lebeni 461;441 80013311 4) Lebeni Solun 461;441 80013312 Solun Lebeni 461;441 800

13313 5) Lebeni Solun 461;441 80013314 6)

Solun Lebeni 461;441 800

Table 2-1

Passenger Train Services

Page 3 of 3

MZ CARS FOREIGN CARS

EMU DMU

EMU 412EMU 412;DMU 712

EMU 412

Train Number FROM TO

EMU 412

PowerTrailing Tonnes Wagon Class

August 2001 Page 40

STATION

Figure 2-1

TIME

TIME-DISTANCE CHART - GEVGELIJA-VELES-SKOPJE-TABANOVCI

SKOPJE

TABANOVCI

VELES

GEVGELIJA

22:0

0

23:0

0

00:0

0

18:0

0

19:0

0

20:0

0

21:0

0

14:0

0

15:0

0

16:0

0

17:0

0

10:0

0

11:0

0

12:0

0

13:0

0

06:0

0

07:0

0

08:0

0

09:0

0

02:0

0

03:0

0

04:0

0

05:0

0

00:0

0

01:0

0

8930 8931

89328933

29002901 2902

2903

2904

2905

2906

29082907

2909

3902

3903

3905

3900

3901

3904

August 2001 Page 41

01:0

0

02:0

0

03:0

0

04:0

0

05:0

0

06:0

0

07:0

0

08:0

0

09:0

0

10:0

0

11:0

0

12:0

0

13:0

0

14:0

0

15:0

0

16:0

0

17:0

0

18:0

0

19:0

0

20:0

0

21:0

0

22:0

0

23:0

0

00:0

0

TETOVO

SKOPJE

KICEVO

Figure 2-3

TIME-DISTANCE CHART - SKOPJE -KICEVO - TETOVO

TIME

6903 6904

6905

6907 6908

6906 6909

6910 6911

6902

August 2001 Page 42

Motorized Non-motorized

Skopje - Tabanovci 365

50 36,500 146,000

Skopje - Veles 365 56 40,880 163,520

3901/3904/3905/3900 2 EMU 412 2 2 Skopje - Gevgelija 365 161 117,530 333,002

3902/3903 1 EMU 412 2 2 Skopje - Gevgelija 365 161 117,530 352,590

6 6 312,440 995,112

Skopje - Tabanovci 365 50 36,500 109,500

Skopje - Veles 365 56 40,880 81,760

5900/5901/5902/5903 1 DMU 712 11

Skopje - Kocani 365 141 102,930 720,510

3 2 180,310 911,770

6 9 8 492,750 1,906,882

EMU and DMU Services

Table 2-2

StationsNumber of Cars

Car-Kms per YearRound

Trips per Year

One-Way Distance

Train-Kms per Year

2 1

2

Train Numbers Number of Sets Type

8931/8932/2904/2907/ 2906/2909/2908/2901 1 EMU 412

12900/2903/2902 2905/ 8933/8930 DMU 712

2

August 2001 Page 43

Train No. From To Type No. of Units Hours6902 SKOPJE_P KICEVO6902 SKOPJE_P KICEVO 2 1 4.86906 SKOPJE_P KICEVO6906 SKOPJE_P KICEVO 2 1 4.86905 KICEVO SKOPJE_P6905 KICEVO SKOPJE_P 2 1 4.86909 KICEVO SKOPJE_P6909 KICEVO SKOPJE_P 2 1 4.86910 SKOPJE_P TETOVO6910 SKOPJE_P TETOVO 2 1 4.86911 TETOVO SKOPJE_P6911 TETOVO SKOPJE_P 2 1 4.8

From To Car Type Service Cars Psgrs/car Cycle

SKOPJE_P KICEVO BMZ 2 5 20 0.2SKOPJE_P KICEVO BMZ 2 5 20 0.2KICEVO SKOPJE_P BMZ 2 5 20 0.2KICEVO SKOPJE_P BMZ 2 5 20 0.2SKOPJE_P TETOVO BMZ 2 3 20 0.2TETOVO SKOPJE_P BMZ 2 5 20 0.2

Unit Cost Workload CostPassenger car trips - 28 - number of Passengers 9.860 560 5,520 Passenger-kms - 57,384 - Passenger Car-kms 15.27 2,869 43,820 Passenger Car Costs - - Wtd.Loaded car-kms - - Gross ton-kms 0.1018 114,768 11,683 Weighted Gross ton-kms - 149,198 - Train-kms 133 598 79,836 Weighted Train-kms - 598 - Crew Wages . 11,968 - Train-hours - 24 - Passenger car-days BMZ 1,395 6 7,812 Loco-kms 2 57.3 598 34,263 Loco-hours 2 872 29 25,110 Fuel 2 24.3 1,685 40,949 Total VARIABLE Cost 248,993Cost per Passenger Car trip 8,893Cost per Passenger 444.63Cost Passenger-Km 4.3391

LOCOMOTIVE DATA

Passenger Costs - Trains 6902/6905/6906/6909/6910/6911

Table 2-3

CAR DATA

OUTPUT

Output by Workload

August 2001 Page 44

Number Fixed or Variable Description

1 V Traffic Department 35,2925 V Traction crews 39,1767 V Traction fuel and power 53,351

10 V Traction equipment maintenance 34,26312 V Passenger car running repairs 42,30615 V Freight car runing repaits 1,35424 V Financial Charges - Passenger cars 7,81225 V Financial charges - Traction 25,11030 V ZOP 10,329

V Total 248,993V Total Variable Cost 248,993VV Total Cost Per Passenger Car trip 8,893V Variable Cost Per Passenger Car trip 8,893V Total Cost per Passenger 445V Variable Cost per Passenger 445V Total Cost per Passenger-Km 4.339072

Account Group

Table 2-4

Passenger Costs - Trains 6902/6905/6906/6909/6910/6911

Amount (denars)

Expenses by Account Group

August 2001 Page 45

From To Type No. of Units HoursSKOPJE_P KICEVOSKOPJE_P KICEVO 2 1 7.2SKOPJE_P KICEVOSKOPJE_P KICEVO 2 1 7.2KICEVO SKOPJE_PKICEVO SKOPJE_P 2 1 7.2KICEVO SKOPJE_PKICEVO SKOPJE_P 2 1 7.2

From To Car Type Service Cars Psgrs/car Cycle (days)

SKOPJE_P KICEVO BMZ 2 4 20 0.3SKOPJE_P KICEVO BMZ 2 5 20 0.3KICEVO SKOPJE_P BMZ 2 5 20 0.3KICEVO SKOPJE_P BMZ 2 5 20 0.3

Unit Cost Workload CostPassenger car trips - 19 - number of Passengers 9.9 380 3,746 Passenger-kms - 45,182 - Passenger car-kms 15.3 2,259 34,502 Passenger car costs - - Wtd.Loaded car-kms - - Gross tonne-kms 0.1 90,364 9,199 Weighted gross tonne-kms - 117,473 - Train-kms 133.4 476 63,452 Weighted train-kms - 476 - Crew Wages . 9,512 - Train-hours - 19 - Passenger car-days BMZ 1,395.0 6 7,952 Locomptive-kms 2 57.3 476 27,232 Locomotiove-hours 2 871.9 29 25,110 Fuel 2 24.3 1,327 32,241

Total variable cost 203,435Cost per Passenger Car trip 10,707Cost per Passenger 535Cost per Passenger-Km 4.5026

Table 2-5

Passenger Costs - Trains 6903/6904/6907/6908Output by Workload

LOCOMOTIVE DATA

CAR DATA

OUTPUT

August 2001 Page 46

Number Fixed or Variable Description

1 V Traffic Department 27,3975 V Traction crews 31,1377 V Traction fuel and power 42,098

10 V Traction equipment maintenance 27,23212 V Passenger car running repairs 33,31015 V Freight car runing repaits 1,06624 V Financial Charges - Passengercars 7,95225 V Financial charges - Traction 25,11030 V ZOP 8,133

V Total 203,435V Total Variable Cost 203435VV Total Cost Per Passenger Car trip 10,707V Variable Cost Per Passenger Cartrip 10,707V Total Cost per Passenger 535V Variable Cost per Passenger 535V Total Cost per Passenger-Km 4.5026

Table 2-6

Passenger Costs - Trains 6903/6904/6907/6908Expenses by Account Group

Account Group Amount (denars)

3. Costing Freight ServicesThe costing model makes it possible to calculate the cost of freight traffic one carload at a time. The minimum parameters that must be provided to the model for any cost calculation are the origin, the destination, the commodity, the car type, the number of cars and the number of tonnes. The model then searches the fixed input tables for the remaining information about the route, the train sizes, type of power, switching, car and locomotive utilization, and empty return ratio.

The batch mode permits the cost calculation of a large volume of traffic, while taking into account the specific characteristics of each car. This depends, however, on their being the required detailed traffic information in electronic form, that is, a waybill file showing the origin, destination, commodity, car type, and tonnes. MZ has produced such a file for the first quarter of the year 2001.

Unfortunately, that waybill file contains no revenue information. We understand that the main difficulty relates to traffic on contract rates, for which the waybill shows a contract number rather than a revenue figure. It is very much recommended that a system be set up to look up the contract rate for every waybill and produce a waybill bile file that contains a revenue figure on every record. This would make it possible to calculate the profitability, as well as the cost, for any desired aggregate.

Tables 3-1 and 3-2 show the total cost of the traffic on the quarterly waybill file, in the two formats previously discussed in connection with passenger service.

Table 3-3 shows a summary of the results for each of the 54 commodities. For comparison, total traffic volume by commodity for 1999 is also shown. The cost per net tonne-km is also shown by commodity for the 2001 quarterly traffic. The average cost per net tonne-km for that traffic is 2.865 denars, compared to 2.66 denars for 1999 (as per Table 1-9)

There are significant variations among commodities, although the very extreme values are probably due to data problems that require some investigation. In fact, the batch system is an effective way of testing the validity of the input tables and traffic data. For now, however, the quarterly average and the 1999 average are as close as can be expected from an initial effort, given that the 2001 result is the outcome of thousands of calculations carried out on 1857 traffic records

Finally, Tables 3-4 and 3-5 show the results summarized by origin and by destination, respectivelu,

August 2001 Page 47

August 2001 Page 48

Unit Cost Workload Cost (Denars)

Carloads 471 27,161 12,792,838 Tons 49.6 917,193 45,479,321 Net ton-kms - 111,591,105 - Loaded Car-kms 0.4181 3,202,971 1,339,203 Empty car-kms 0.4181 2,788,080 1,165,732 Wtd.Loaded car-kms - 3,202,971 - Wtd. Empty car-kms - 2,788,080 - Gross ton-kms 0.389 231,412,138 89,903,617 Weighted Gross tonne-kms - 321,108,211 - Train-kms 133.42 266,581 35,565,950 Weighted Train-KMS - 266,581 - Crew Wages . 5,331,621 - Train-hours - 10,663 - Car-days MAK1 610 939 572,839 Car-days MAK2 610 2 1,408 Car-days MAK3 610 8,442 5,152,401 Car-days MAK4 610 1,220 744,553 Car-days MAK5 610 6,449 3,935,848 Car-days MAK6 610 1,383 844,243 Car-days MAK7 610 18,411 11,236,783 Car-days MAK9 610 5 2,803 Car-days FGN1 610 2,058 1,255,794 Car-days FGN2 610 4,908 2,995,327 Car-days FGN3 610 5,865 3,579,821 Car-days FGN4 610 1,966 1,199,724 Car-days FGN5 610 4,797 2,927,939 Car-days FGN6 610 42 25,778 Car-days FGN7 610 6,539 3,990,874 Car-days FGN8 610 37 22,409 Car-days FGN9 610 40 24,503 Loco-kms 1 21.9 239,937 5,265,191 Loco-kms 2 57.3 26,319 1,506,966 Loco-hours 1 872 14,396 12,551,852 Loco-hours 2 872 1,579 1,376,829 Fuel 1 2.33 4,592,456 10,708,112 Fuel 2 24.30 130,797 3,179,010 Shunting minutes 2 41.69 1,448,864 60,405,388

Total VARIABLE Cost 319,753,100Cost per Tonne 348.62Cost per Net Tonne-km 2.8654

Costs by Workload

Table 3-1

Variable Cost Calculation through the Batch System First Quarter of the Year 2001

Table 3-2

Variable Cost Calculation through the Batch System

First Quarter of the Year 2001

Costs by Account

Acct Description Batch Cost

1 Traffic Department 98,754,109 5 Traction crews 22,588,344 7 Traction fuel and power 22,094,708

10 Traction equipment maintenance 20,598,581 15 Freight car runing repaits 5,235,599 16 Traction Department Depreciation 2,532,437 22 Depreciation - Passenger cars 38,513,048 25 Financial charges - Traction 22,263,268 30 Infrastructure 87,172,956

Total 319,753,049 Total Variable Cost 319,753,049 Total Cost per LOADED Car 11,773 Variable Cost per LOADED Car 11,773 Total Cost per Ton 349 Variable Cost per Ton 349 Total Cost per Net Ton-Km 2.865 Variable Cost per Net Ton-km 2.865

August 2001 Page 49

August 2001 Page 50

CARS TONS NTK CARS TONS NTK COST (Denars) Cost per NTK (denars

1 Coal, coke 2017 74965 10,442,735 595 21,612 2,397,818 7,223,456 3.0132 Brown coal, lugnute 884 30880 5,287,966 3 Criude oil 12169 566943 120,417,397 4,585 218,601 38,054,807 78,361,684 2.0594 Gasoline, petorleum, gas 1982 95887 13,344,463 1,168 59,438 1,288,798 9,826,134 7.6245 Gaes6 Ferrous ore, scrap 5 100 1,500 31,120 20.7477 Ores & ferrous metals 1494 67995 11,046,245 419 15,318 1,863,989 5,168,425 2.7738 Slag, ash 6 305 30,024 78,296 2.6089 Non-metals except sand & gravel 1050 47715 6,626,590 34 1,641 106,883 365,897 3.423

10 Iron, steel 3991 131713 24,049,522 549 17,344 2,464,215 6,658,975 2.70211 Ferrous metal products 13626 531656 105,158,941 7,499 261,495 36,493,182 92,428,260 2.53312 Non-metal products 62 1427 250,121 13 Processed & unprocessed wood 2399 84984 13,994,201 984 29,364 4,845,667 13,691,943 2.82614 Firewood, cork 26 1232 215,016 15 Cement 57 2246 200,001 1 36 7,410 16,773 2.26416 Sand, gravel 748 27469 3,455,295 17 Limestone, bricks, muilding materials 573 12669 1,845,391 324 8,386 660,677 3,003,686 4.54618 Glass & glass products 298 5851 1,321,997 105 1,704 277,498 1,185,073 4.27119 Fertilizers, 1650 63692 7,195,219 652 23,117 2,074,138 6,818,713 3.28720 Wheat 1179 52313 6,619,033 698 32,108 3,802,790 9,605,006 2.52621 Wheat products 265 10259 456,605 530 20,796 559,886 4,189,184 7.48222 Sugar cane 222 5597 1,178,583 23 Fresh fruit 24 Fresh vegetables 83 3093 551,650 62 2,073 246,100 771,520 3.13525 Live animals 1002 6594 1,155,464 26 Meat & Fish27 Milk & dairy products, eggs 2 86 5,322 13 438 21,736 97,500 4.48628 Sugar & sugar products 61 2237 77,042 36 1,808 78,838 350,516 4.44629 Spirits 150 7163 928,624 44 2,134 216,836 541,026 2.49530 Food produts 460 18566 3,144,226 150 6,433 941,266 2,362,710 2.510

Commodity

Page 1 of 2

Table 3-3

Traffic and Costs by Commodity

Total 1999 First Quarter 2001

August 2001 Page 51

CARS TONS NTK CARS TONS NTK COST (Denars) Cost per NTK

(denars

31 Livestock feed 138 3612 645,617 67 1,604 292,064 919,230 3.14732 Oils & fats 4 167 40,300 33 Hide, varnish, & similar 1 1 133 4 101 20,460 58,706 2.86934 Textile products, fibres 74 1343 244,257 21 490 90,968 268,056 2.94735 Used paper36 Cardboard, resin distillation agents 54 2806 599,328 16 845 171,915 317,091 1.84437 Other chemical products 625 24014 2,804,784 161 6,051 585,462 1,864,353 3.18438 Acids and liquified gases 1573 68132 2,302,657 276 13,572 1,317,916 3,507,310 2.66139 Metal producs 205 3174 552,418 104 1,329 121,651 855,950 7.03640 Road vehicles 2229 39679 8,359,158 832 10,968 1,613,571 8,205,214 5.08541 Rail vehicles 295 6130 1,254,104 25 780 72,544 279,799 3.85742 Machines, engines, boilers, apparatus 1842 57955 3,521,744 387 5,899 999,627 4,522,865 4.52543 Wood produts 5 65 9,348 2 58 2,512 15,994 6.36744 Cardboard, paper 1231 25436 5,678,951 727 13,767 2,614,129 9,507,737 3.63745 Miscellaneous 416 3792 535,191 104 945 77,292 711,973 9.21146 Cars 5,042 115,249 4,757,639 36,588,658 7.69147 Containers - loaded 1943 61333 11,902,942 633 18,636 2,216,244 7,233,440 3.26448 Containers - empty 649 5768 898,124 231 1,661 156,024 1,642,963 10.53049 Khupepak 10 71 13,017 5 55 5,135 45,726 8.90550 Transportation by SPT - 49 free51 Transportation by SPT - 49 paid 107 4144 391,886 52 Subtotal of goods 167 2915 584,875 56 839 35,476 355,353 10.01753 Used packing mmaterial 39 686 148,634 7 81 5,639 60,588 10.74454 Other goods 80 1042 217,251 2 13 810 16,117 19.89855 Part loaded 150 21,555

58,137 2,165,647 379,693,923 27,161 917,193 111,591,136 319,753,020 2.865TOTAL

Total 1999 First Quarter 2001 Commodity

Page 2 of 2

Table 3-3

Traffic and Costs by Commodity

August 2001 Page 52

Origin Station Cars Tonnes Net Tonne-Kms Cost (Denars)Cost per Net Tonne-km (Denars)

Bitola 3 84 19,752 59,684 3.022Gevgelija 15,092 517,462 67,099,896 180,314,689 2.687Jegunovci 33 1,889 273,210 604,387 2.212Krivolak 1 23 3,432 11,958 3.484Kumanovo 92 3,529 458,316 1,191,944 2.601Lisice 37 1,084 66,359 328,178 4.945Madzari 25 615 83,464 289,002 3.463Miladinovci 269 11,920 464,377 2,443,219 5.261Miravci 12 677 68,318 166,068 2.431Negotino 22 1,048 157,211 346,633 2.205Ovec_Pole 5 123 16,431 62,061 3.777Prilep 1 8 1,378 12,281 8.912Skopje_P 2,841 109,211 16,228,066 37,357,400 2.302Stip 36 912 137,101 491,766 3.587Tabanovci 6,778 199,733 21,897,228 76,262,176 3.483Tetovo 1 17 1,713 10,283 6.003Veles 297 14,933 1,498,033 3,876,137 2.587Volkovo 134 3,473 516,931 1,775,374 3.434Yancovic 1,408 47,531 2,269,107 13,221,394 5.827Zgropolci 74 2,920 330,813 928,386 2.806

TOTAL 27,161 917,193 111,591,136 319,753,020 2.865

Table 3-4

Costs by Origin - First Quarter 2001

August 2001 Page 53

Destination Station Cars Tonnes Net Tonne-Kms Cost (Denars)Cost per Net Tonne-km (Denars)

Bitola 173 7,838 1,786,619 4,010,944 2.245G_Petrov 28 414 23,240 207,215 8.916Gevgelija 10,119 280,942 29,965,311 104,916,907 3.501Gostivar 29 1,295 160,591 450,299 2.804Gradsko 74 2,766 232,972 712,930 3.060Ilinden 6 44 1,624 35,656 21.956Jegunovci 81 2,829 292,022 1,037,231 3.552Kicevo 3 80 12,582 46,522 3.698Kocani 3 77 14,144 48,206 3.408Krivolak 3 95 13,992 39,612 2.831Kumanovo 210 8,136 103,328 1,463,690 14.165Lisice 205 8,355 764,983 2,344,873 3.065Madzari 338 10,693 471,560 2,793,179 5.923Miladinovci 4,942 229,311 38,940,062 81,726,935 2.099Miravci 12 72 13,636 128,860 9.450Negotino 28 710 106,490 347,225 3.261Nikola_Karev 67 3,069 631,667 1,410,147 2.232Ovec_Pole 21 723 96,909 285,357 2.945Prilep 30 1,156 212,315 537,318 2.531Skopje_P 6,204 192,899 24,101,702 68,522,130 2.843Stip 88 4,675 732,498 1,640,717 2.240Tabanovci 1,400 54,365 5,073,339 15,831,217 3.120Tetovo 4 95 9,414 44,688 4.747Trubarevo 6 287 11,421 56,636 4.959Veles 1,166 36,817 3,690,790 12,550,674 3.401Volkovo 1,317 47,249 2,002,191 11,891,739 5.939Zelenikovo 2 51 4,167 18,773 4.505Zgropolci 602 22,152 2,121,567 6,653,340 3.136

27,161 917,193 111,591,136 319,753,020 2.865

Costs by Destination - First Quarter 2001

Table 3-5

4. Input to the Costing ModelAs previously mentioned, the costing model is driven by 13 tables that define all the network, cost and operating parameters required to produce a point-to-point cost. The precise functions of the 13 tables are explained in the User’s Manual, which has been provided to MZ staff.

The model is designed to handle very specific input tables, but do not require them. For example, the tables make it possible to specify different fuel consumption rates on different lines, but only a system average was available. That system average was applied to all lines. Once new, geographically-specific information is developed, it can be used without requiring any changes in the structure of the model or the table.

We strongly emphasize that, although the tables as they stand yield a usable system, they suffer from a number of serious shortcomings, many of which can be corrected with a relatively modest effort.

In this section, we provide an overview of the tables, provide some comments on selected tables requiring particular attention, and make some recommendations for improvements.

Figure 4-1 displays the interconnections between the traffic input, the fixed input tables, and the workload calculations. Tables 4-1 to 4-10 show 10 of the 13 tables used by the model. The missing tables are:

The Intermodal Unit table, which normally contains the ownership and maintenance costs of various container and trailer types, and the tare weight of each type. Since MZ does not own intermodal units, there is no ownership cost. But since MZ carries containers, it needs tare weight information. MZ was provided with a generic table for that purpose;

The Intermodal Terminal table, which is not currently relevant since MZ does not provide terminal services. It will be a small matter to develop the required information if MZ does provide terminal services. In the meantime, a non-operative dummy table is used, both to meet the format requirements of the model and the remind the user of the available capability;

The track table, which provides factors by which to adjust an average track maintenance per gross tonne-km according to the terrain and the axle-load. No information is available to fill that table.

4.1. Calculation of Workloads and Costs - OverviewAt start-up, the model reads all the fixed input tables and stores them in memory. It is now ready to receive information about any traffic to be analyzed. When the model receives the traffic input (origin, destination, commodity, car type, cars and tonnes), it looks up all the tables for additional information. In interactive mode, the Commodity table and the Car Type table presents the user with a list of valid commodities and car

August 2001 Page 54

types. In batch mode, the commodity and car type are identified by a code, and the model looks up the codes in the respective tables for further information.

The Car Type table provides information about each car type: the tare weight, the car time required at the terminals, and the car group to which the car type belongs for the purposes of the Car Utilization table.

The Car Utilization table provides, for each group of cars, the empty return ratios by link.

The Link table and the Station table provide the structure of the network. They determine the path and the distance of any movement from origin to destination. In addition, the Station table provides information about switching at every station.

Given the path of the movement, the model looks up the station table and the Node Switching table to calculate the switching minutes.

Given the traffic data and the path, the model can calculate the loaded car-kms. By looking up the empty return ratio in the Car Utilization table, the model can calculate the empty car-kms.Given both the empty and the loaded car-kms, and the tare weight of the car obtained from the car type table, the model calculates the gross tonne-kms by link by direction. Given the car-kms and the gross tonne-kms on each link, the model looks up the Train table and calculates the calculates the number of train-kms, locomotive-kms by type, train-hours, locomotive-hours by type and crew wages.Given the path, the total car-kms, car-time parameters obtained from the car type table and the car utilization tables, and commercial speeds obtained from the Train table, the model calculates the total car-days for the movement.

Given the gross tonne-kms by link by direction, the model looks up fuel consumption rates per gross tonne-km in the Fuel table to calculate the total fuel consumption.

Give the above workload values, the model looks up the appropriate unit cost in the Unit cost table, multiplies each workload value by the corresponding unit cost, and sums the products to obtain the total cost of the movement.

4.2. Switching InformationSwitching information is provided by 2 tables: the Station Table (see Table 4-2) and the Node Switching table (see Table 4-4). These two tables make it possible to specify the following:

For each Node:

o The number of switching minutes required to originate or terminate a car

o The number of switching minutes required to handle a car passing through the Node on a Through train

o The number of switching minutes required to handle a car passing through the Node but arriving or departing on a local train

For each station between nodes, the number of minutes require to originate or terminate a car

August 2001 Page 55

For each station within the terminal limits of a node: the number of minutes required to originate or terminate a car.

It proved impossible with the time and information available to produce the above information. It was therefore necessary to assign the same average time to every origination or termination, regardless of location, and no allowance was made for through switching.

A major improvement could be made through an informal ad hoc study based on discussions with local operating officers. In such a study, an effort should be made to separate the switching work provided at the customer’s expense from that which the railway provides as part of its normal operating function,

4.3. Train InformationTable 4-3 shows the average freight train characteristics for each section, obtained from the railway’s statistical system. However, the model can accommodate distinctions by type of train (local vs. direct, or special-service trains vs. general purpose), as well as by location. That capability is important if there are significant variations in train types. In the absence of a MIS system, it is still possible to develop such information manually through a small but judiciously selected sample of train sheets..

4.4. Car UtilizationSorely missing from the MZ database is car history information, in particular:

Empty return movement by car type by location by direction;

MZ car time of foreign railways and foreign car time on MZ

Car movement history, separating load/unload time, running time, idle time, unserviceable time, etc

This makes it impossible to produce factual information for the Car Type table (Table 4-3) , which requires measures of unproductive time and terminal time, and the Car Utilization table (Table 4-6), which require empty return ratio information.

Pending the establishment of a MIS, it is recommended that MZ staff review all data sources liable to yield such information.

4.5. Energy ConsumptionThe Fuel table (Table 4-7a for freight and 4-7b for passenger), permit the use of energy consumption factors by location by direction by type of locomotive. No geographic distinctions are available, nor is it obvious that such are needed. The possibility, however, should be borne in mind for future developments.

4.6. The Unit Cost TableThe Unit Cost table (Table 4-8) is the result of a complex process leading, through a network of Excel files, from the raw data supplied by the railway, to the final table relating each item of expense to one or several variables. The Excel files will be transmitted to MZ electronically.

The development of the unit cost system was severely hampered by the lack of detail in the accounting data. One serious gap is the lack of activity-based detail. It is recommended that MZ undertake a major review of its expenditure reporting practices,

August 2001 Page 56

to provide the activity detail required by costing. The spreadsheets used to develop the unit cost system should serve as a guide by displaying the amount of work and devices that would not have been necessary had there been a more explicit expenditure-reporting system.

August 2001 Page 57

August 2001 Page 58

Figure 4-1

Development of Workload Units from Input Tables

TRAFFIC INPUTOriginDestinationCommodityCar TypeCarsTonnes

COMMODITY TABLE

CAR TYPE TABLE

Commodity Code

Car Type Information

CAR UTILIZATION TABLE

Route and Distance

LINK TABLE

STATION TABLE

NODE SWITCHING

TABLELoaded Car-kms

Total Car-kmsEmpty Return

Ratio and Car Time Factors

Gross Tonne-kms

TRAIN TABLE

Switching Minutes

Locomotive-kmsTrain-kms

Crew wages

Loaded Car-kms

FUEL TABLE Fuel Consumption

Car-days

August 2001 Page 59

LK_2 SKOPJE_N MADZARI 6 6 600 600 600 10 10 10 1 1 1LK_3 SKOPJE_P MADZARI 6 6 600 600 600 10 10 10 1 1 1SK-45 TOVARNA MADZARI 8 8 600 600 600 10 10 10 1 1 1SK-20 LISICE DRACEVO 5.9 5.9 600 600 600 10 10 10 1 1 1LK_5 LISICE TRUBAREVO 100 100 600 600 600 10 10 10 1 1 1LK_7 SKOPJE_P LISICE 6.7 6.7 500 500 500 10 10 10 1 1 1SK-30 MADZARI TRUBAREVO 4 4 600 600 600 10 10 10 1 1 1LK_6 DRACEVO ILINDEN 23.6 23.6 600 600 600 10 10 10 1 1 1SK-35 MADZARI ILINDEN 6.6 6.6 600 600 600 10 10 10 1 1 1S-42 TRUBAREVO ILINDEN 4.2 3.3 100 100 100 20 20 20 1 1 1Y-10 ILINDEN MILADINOVCI 7.5 7.5 100 100 100 20 20 20 1 1 1YU_15 MILADINOVCI ROMANOVCI 9.7 9.7 100 100 100 20 20 20 1 1 1YU_39 ROMANOVCI KUMANOVO 7.1 3.1 100 100 100 20 20 20 1 1 1YU_40 KUMANOVO TABANOVCI 12.7 3.1 100 100 100 20 20 20 1 1 1Sk-10 TRUBAREVO DRACEVO 14.1 3.6 200 200 200 30 30 30 1 1 1G-10 DRACEVO VELES 43.3 38.64 200 200 200 30 30 30 1 1 1G-20 VELES GRADSKO 27.36 27.36 300 300 300 40 40 40 1 1 1G-30 GRADSKO DUBROVO 30.61 30.61 300 300 300 40 40 40 1 1 1G-40 DUBROVO GEVGELIJA 47 54.08 300 300 300 40 40 40 1 1 1K-20 SKOPJE_N G_PETROV 6.6 6.6 600 600 600 50 50 50 1 1 1KC-10 G_PETROV RADUSA 17.1 17.1 800 800 800 50 50 50 1 1 1KC-15 RADUSA JEGUNOVCI 11.1 11.1 800 800 800 50 50 50 1 1 1KC-20 JEGUNOVCI TETOVO 14.6 14.6 800 800 800 50 50 50 1 1 1KC-30 TETOVO GOSTIVAR 23.5 23.5 800 800 800 50 50 50 1 1 1KC-35 GOSTIVAR ZAJAS 24 24 800 800 800 50 50 50 1 1 1KC-40 ZAJAS KICEVO 10 10 800 800 800 50 50 50 1 1 1KC-40-1 ZAJAS TAJMISTE 7 7 830 830 830 80 80 80 1 1 1K-30 G_PETROV VOLKOVO 6 6 700 700 700 60 60 60 1 1 1K-40 VOLKOVO YANCOVIC 15 15 700 700 700 60 60 60 1 1 1G30-1 GRADSKO SIVEC 5 5 330 330 330 70 70 70 1 1 1BU-10 KUMANOVO KUMANOVO_N 15 15 110 110 110 130 130 130 1 1 1BU-20 KUMANOVO_N BELIAKOVCI 35 35 110 110 110 130 130 130 1 1 1KO_10 VELES OVEC_POLE 35.53 35.53 400 400 400 90 90 90 1 1 1KO-20 OVEC_POLE STIP 16.2 16.2 400 400 400 90 90 90 1 1 1KO-30 STIP SOKOLARCI 22.05 22.05 400 400 400 90 90 90 1 1 1KO-40 SOKOLARCI KOCANI 11.7 11.7 400 400 400 90 90 90 1 1 1B-10 VELES PRILEP 85.08 85.08 500 500 500 100 100 100 1 1 1B-20 PRILEP GUMNO 14.01 14.01 500 500 500 100 100 100 1 1 1B-25 GUMNO BITOLA 30.24 30.24 500 500 500 100 100 100 1 1 1B-30 BITOLA KREMENICA 15.96 15.96 500 500 500 100 100 100 1 1 1SA-10 GUMNO SAPOTNICA 29.07 29.07 510 510 510 110 110 110 1 1 1G_50 SOLUN GEVGELIJA 100 100 510 510 510 120 120 120 1 1 1

CAR-KM WEIGHT

LOADED EMPTYCAR LINK

FUEL LINK

TRACK LINK

TRAIN-KM WT.

Table 4-1 LINK Table

'LINK FROM TO DIST. ROUTETRAIN RUN

RUN RUN RUN

August 2001 Page 60

' Switching' Switching Minute' Station Node Type Per Car'

* Skopje_Jug MADZARI 2 32

* Skopje_Sever TRUBAREVO 2 32

* Skopje_Tovarna TRUBAREVO 2 32

* Skopje TRUBAREVO 2 32

' Switching' Real Route Route Switching Minute'Station Link From To Distance Dist 1 Dist 2 Type Per Car'

Zinzifov G-10 Veles Dracevoc 10 10 30 2 32

Kadina_Reka G-10 Veles Dracevoc 20.6 20.6 14 2 32

Zelenikovo G-10 Veles Dracevoc 26.4 26.4 13 2 32

Sandanski G-10 Veles Dracevoc 32.5 32.5 8 2 32

Zgropolci G-20 Veles Gradsko 14.7 14.7 12.67 2 32

Negotino G-30 Gradsko Dubrovo 24.01 24.01 6.7 2 32

Krivolak G-30 Gradsko Dubrovo 20.71 20.71 10 2 32

Miravci G-40 Dubrovo Gevgelija 32.81 32.81 21.27 2 32

Nikola_Karev B-25 Gumno Bitola 7.6 7.6 22.65 2 32

Table 4-2 - STATION TABLE

August 2001 Page 61

100 25 18.9 866.8 1 1 1.15 0 0 0 1 0 0 0 1.5 0 0 0 0

200 25 23.6 851.9 1 1 1.17 0 0 0 1 0 0 0 1.5 0 0 0 0

300 25 12.6 934.4 1 1 1.07 0 0 0 1 0 0 0 1.5 0 0 0 0

400 25 20.6 527.6 1 1 0 1.90 0 0 0 1 0 0 0 1.5 0 0 0

500 25 8.0 526.6 1 1 0 1.90 0 0 0 1 0 0 0 1.5 0 0 0

600 25 12.1 619.0 1 1 0 1.62 0 0 0 1 0 0 0 1.5 0 0 0

700 25 12.6 659.7 1 1 0 1.52 0 0 0 1 0 0 0 1.5 0 0 0

800 25 8.0 575.9 1 1 0 1.74 0 0 0 1 0 0 0 1.5 0 0 0

830 25 13.2 396.8 1 1 0 2.52 0 0 0 1 0 0 0 1.5 0 0 0

330 25 5.6 287.8 1 1 0 3.47 0 0 0 1 0 0 0 1.5 0 0 0

110 25 11.3 340.2 1 1 0 2.94 0 0 0 1 0 0 0 1.5 0 0 0

510 25 8.0 300.0 1 1 0 3.33 0 0 0 1 0 0 0 1.5 0 0 0

Table 4-3 - TRAIN TABLE

Crew Wages per Train-Km

LINKKms per Hour

Cars per Train

Tonnes per

Train

Locomotives per Train Locomotive Unproductive Factor

1 2 3 4 1 2 3 4

Alloc. Method

Train Loco

Locos per 1000 Tonnes

1 2 3 4

August 2001 Page 62

1 TOVARNA 2 32 2 0 1 22 SKOPIE_P 2 32 2 0 1 23 LISICE 2 32 2 0 1 24 MADZARI 2 32 2 0 1 25 DRACEVO 2 32 2 0 1 26 ILINDEN 2 32 2 0 1 27 TRUBAREVO 2 32 2 0 1 28 MILADINOVCI 2 32 2 0 1 29 ROMANIVCI 2 32 2 0 1 2

10 VELES 2 32 2 0 1 211 GRADSKO 2 32 2 0 1 212 DUBROVO 2 32 2 0 1 213 GEVGELIJA 2 32 2 0 1 214 BITOLA 2 32 2 0 1 215 KREMENICA 2 32 2 0 1 216 SKOPIE_N 2 32 2 0 1 217 G_PETROV 2 32 2 0 1 218 VOLKOVO 2 32 2 0 1 219 RADUSA 2 32 2 0 1 220 JEGUNOVCI 2 32 2 0 1 221 TETOVO 2 32 2 0 1 222 GOSTIVAR 2 32 2 0 1 223 ZAJAS 2 32 2 0 1 224 KICEVO 2 32 2 0 1 225 TAJMISTE 2 32 2 0 1 226 SIVEC 2 32 2 0 1 227 KUMANOVO 2 32 2 0 1 228 TABANOVCI 2 32 2 0 1 229 KUMANOVO_N 2 32 2 0 1 230 BELIKOVCI 2 32 2 0 1 231 OVEC_POLE 2 32 2 0 1 232 STIP 2 32 2 0 1 233 SOKOLARCI 2 32 2 0 1 234 KOCANI 2 32 2 0 1 235 YANCOVIC 2 32 2 0 1 236 PRILEP 2 32 2 0 1 237 GUMNO 2 32 2 0 1 238 SAPOTNICA 2 32 2 0 1 0

NODE

Table 4-4 - NODE SWITCHING TABLE

Type Minutes per Car

Local Way Thru

Type Minutes per Car Type Minutes

per Car

August 2001 Page 63

MAK1 Ordinary_closed_MZ 1 20 2 1.2

MAK2 Special_closed_cars_MZ 2 20 2 1.2

MAK3 Two_axle_flat_MZ 3 20 2 1.2

MAK4 Automobile_Flat_MZ 4 20 2 1.2

MAK5 Open_car_high_side_MZ 5 20 2 1.2

MAK6 Special_open_cars_MZ 6 20 2 1.2

MAK7 Tank_cars_MZ 7 20 2 1.2

MAK8 Refrigerator_cars_MZ 8 20 2 1.2

MAK9 Compressed_air_MZ 9 20 2 1.2

FGN1 Ordinary_closed_foreign-owned 10 20 2 1.2

FGN2 Special_closed_cars_foreign-owned 11 20 2 1.2

FGN3 Two_axle_flat_foreign-owned 12 20 2 1.2

FGN4 Automobile_Flat_foreign-owned 13 20 2 1.2

FGN5 Open_car_high_side_foreign-owned 14 20 2 1.2

FGN6 Special_open_cars_foreign-owned 15 20 2 1.2

FGN7 Tank_cars_foreign-owned 16 20 2 1.2

FGN8 Refrigerator_cars_foreign-owned 17 20 2 1.2

FGN9 Compressed_air_foreign-owned 18 20 2 1.2

F99 UNKNOWN 18 20 2 1.2

Car Type Code

Decription

Table 4-5a - FREIGHT CAR TYPE TABLE

Tare Weight

Car Group

Days per

Carload

Unproductive Factor

August 2001 Page 64

WLABMZ Sleeping_MZ 1 40 0 0

BCMZ Sleeping_MZ 1 40 0 0

BMMZ Second_Class_MZ 1 40 0 0

ABMMZ First_Second_Class_MZ 1 40 0 0

VABRMZ Buffet_Restaurant_MZ 1 40 0 0

AMZ First_Class_MZ 1 40 0 0

DCMZ Mail_Cars_MZ 1 40 0 0

BMZ Second_Class_8_seats_MZ 1 40 0 0

FMZ Seasonal_MZ 1 40 0 0

DMU DMU_cars 1 40 0 0

EMU EMU_cars 1 40 0 0

WLABfgn Sleeping_Foreign 1 40 0 0

BCFGfgn Couchette_Foreign 1 40 0 0

BMfgn Second_Class_Foreign 1 40 0 0

ABMfgn First_Second_Class_Foreign 1 40 0 0

VABRfng Buffet_Restaurant_Foreign 1 40 0 0

Afng First_Class_Foreign 1 40 0 0

DCfng Mail_Cars_Foreign 1 40 0 0

Bfng Second_Class_8_seats_Foreign 1 40 0 0

Ffng Seasonal_Foreign 1 40 0 0

PC99 UNKNOWN 1 40 0 0

Table 4-5b - PASSENGER CAR TYPE TABLE

Car Type Code Decription Car

GroupTare Weight

Days per

Carload

Unproductive Factor

August 2001 Page 65

10 20 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87

20 20 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87

30 20 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87

40 20 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87

50 20 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87

60 20 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87

70 20 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87

80 20 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87

90 20 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87

100 20 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87

110 20 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87

120 20 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87

130 20 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87 0.87

R F R

Table 4-6 - CAR UTILIZATION TABLE

LINK F R F

Group 5 Group 6Com. Speed R F R F R F

Group 1 Group 2 Group 3 Group 4

August 2001 Page 66

F R F R F R F R10 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.720 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.730 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.740 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.750 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.760 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.770 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.780 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.790 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.7

100 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.7110 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.7120 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.7130 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.7140 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.7150 21.2 21.2 8.6 8.6 22.7 22.7 10.7 10.7

Fuel Link

Table 4-7a -FREIGHT FUEL TABLEElectric Locomotive Diesel Locomotive EMU DMU

August 2001 Page 67

1 Traffic Department1 Crew wages TRK 19.30 Total train-kms1 Psgr ticket selling PSGR 9.86 No of passengers1 Passenger train inspection CKP 0.14 Passenger car-kms1 Other passenger personnel CKP 0.39 Passenger car-kms1 Freight traffic billing CL 265.69 Carloads1 Loading/unloading TONS 46.21 Tonnes loaded + unloaded1 Customs TONS 3.37 Tonnes Import + export 1 Other freight personnel CL 205.31 Carloads1 Train control TRK 21.42 Total train-kms1 Switchmen SM 2 8.59 Yard switching minutes1 Switching staff (Shunting) SM 2 10.66 Yard switching minutes1 Other train control personnel TRK 6.51 Total train-kms5 Traction crews5 Train locomotive driver TRK 47.26 Train-kms 5 Train locomotive assistant driver TRK 18.21 Train-kms 5 Yard locomotive driver SM 2 3.54 Yard switching minutes7 Traction fuel and power7 Train electric power FL 1 2.33 Electric power - passenger trains7 Train diesel locomotive fuel FL 2 24.30 Diesel fuel - passenger trains7 EMU fuel FL 3 2.18 Electric power - EMU-s7 DMU fuel FL 4 25.98 Diesel fuel - DMUS's7 Yard fuel SM 2 1.85 Yard switching minutes7 Railbus 25.41 Diesel fuel - Railbus7 Other TRK 20.73 Total Train-kms

10 Traction equipment maintenance10 Elec. Locomotive running repairs LK 1 13.47 Electric locomotive-kms10 Diesel loco running repairs LK 2 57.26 Diesel locomotive-kms incl switching10 Diesel loco running repairs SM 2 9.54 Yard switching minutes10 DMU trains running repairs LK 4 87.11 DMU-kms10 EMU train running repair LK 3 53.58 EMU-kms10 DMU & EMU car running repairs CK DMU 0.00 DMU + EMU car-kms10 Rail bus running repairs 74.07 Railbus-kms10 Zelazaea locomotives 437.89

Table 4-8 - Unit Cost TablePage 1 of 3

F R F R F R F R

10 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.720 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.730 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.740 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.750 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.760 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.770 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.780 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.790 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.7

100 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.7110 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.7120 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.7130 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.7140 23.1 23.1 14.7 14.7 22.7 22.7 10.7 10.7

Table 4-7B -PASSENGER FUEL TABLEFuel Link

Electric Locomotive Diesel Locomotive EMU DMU

August 2001 Page 68

12 Passenger car maintenance12 Passenger car running repairs CKP 11.06 Passenger car-kms incl DMU & EMU cars15 Freight car runing repaits CKL 0.42 Freight car-kms15 Freight car runing repaits CKE 0.42 Freight car-kms15 Work equipment running repairs GTK 0.0118 GTKM10 Investment mtce of elect. Locos LK 1 8.48 Electric locomotive-kms 12 Investment mtce of psgr cars CKP 3.68 Passenger car-kms16 Dep shunters SM 2 1.75 Switching minutes22 Financial Charges - Freight cars CD MAK1 610.32 Ordinary_closed - MZ22 Financial Charges - Freight cars CD MAK2 610.32 Special_closed_cars - MZ22 Financial Charges - Freight cars CD MAK3 610.32 Two_axle_flat - MZ22 Financial Charges - Freight cars CD MAK4 610.32 Automobile_Flat - MZ22 Financial Charges - Freight cars CD MAK5 610.32 Open_car_high_side - MZ22 Financial Charges - Freight cars CD MAK6 610.32 Special_open_cars - MZ22 Financial Charges - Freight cars CD MAK7 610.32 Tank_cars - MZ22 Financial Charges - Freight cars CD MAK8 610.32 Refrigerator_cars - MZ22 Financial Charges - Freight cars CD MAK9 610.32 Compressed_air - MZ22 Financial Charges - Freight cars CD FGN1 610.32 Ordinary_closed - foreign-owned22 Financial Charges - Freight cars CD FGN2 610.32 Special_closed_cars - foreign-owned22 Financial Charges - Freight cars CD FGN3 610.32 Two_axle_flat - foreign-owned22 Financial Charges - Freight cars CD FGN4 610.32 Automobile_Flat - foreign-owned22 Financial Charges - Freight cars CD FGN5 610.32 Open_car_high_side - foreign-owned22 Financial Charges - Freight cars CD FGN6 610.32 Special_open_cars - foreign-owned22 Financial Charges - Freight cars CD FGN7 610.32 Tank_cars - foreign-owned22 Financial Charges - Freight cars CD FGN8 610.32 Refrigerator_cars - foreign-owned22 Financial Charges - Freight cars CD FGN9 610.32 Compressed_air - foreign-owned22 Financial Charges - Freight cars CD FC99 610.32 Unknown Car type24 Financial Charges - Passenger cars CD WLABMZ 1395.01 Sleeping_MZ24 Financial Charges - Passenger cars CD BCMZ 1395.01 Sleeping_MZ24 Financial Charges - Passenger cars CD BMMZ 1395.01 Second_Class_MZ24 Financial Charges - Passenger cars CD ABMMZ 1395.01 First_Second_Class_MZ24 Financial Charges - Passenger cars CD VABRMZ 1395.01 Buffet_Restaurant_MZ24 Financial Charges - Passenger cars CD AMZ 1395.01 First_Class_MZ24 Financial Charges - Passenger cars CD DCMZ 1395.01 Mail_Cars_MZ24 Financial Charges - Passenger cars CD BMZ 1395.01 Second_Class_8_seats_MZ

Table 4-8 - Unit Cost TablePage 2 of 3

August 2001 Page 69

24 Financial Charges - Passenger cars CD FMZ 1395.01 Seasonal_MZ24 Financial Charges - Passenger cars CD WLABfgn 1395.01 Sleeping_Foreign24 Financial Charges - Passenger cars CD BCFGfgn 1395.01 Couchette_Foreign24 Financial Charges - Passenger cars CD BMfgn 1395.01 Second_Class_Foreign24 Financial Charges - Passenger cars CD ABMfgn 1395.01 First_Second_Class_Foreign24 Financial Charges - Passenger cars CD VABRfng 1395.01 Buffet_Restaurant_Foreign24 Financial Charges - Passenger cars CD Afng 1395.01 First_Class_Foreign24 Financial Charges - Passenger cars CD DCfng 1395.01 Mail_Cars_Foreign24 Financial Charges - Passenger cars CD Bfng 1395.01 Second_Class_8_seats_Foreign24 Financial Charges - Passenger cars CD Ffng 1395.01 Seasonal_Foreign24 Financial Charges - Passenger cars CD EMU 1395.01 Non-motorized cars in Electric motor units24 Financial Charges - Passenger cars CD DMU 1395.01 Non-motorized cars in Electric motor units24 Financial Charges - Passenger cars CD PC99 1395.01 Unknown Car type25 Financial charges - Traction25 Financial Charges - electric locomotives LH 1 871.8825 Financial Charges - diesel locomotives LH 2 871.8825 Financial Charges - EMU LH 3 290.6325 Financial Charges - DMU LH 4 290.6325 Financial Charges - shunters SM 2 5.7518 Financial Charges - passenger wagons CD P 58.1330 Infrastructure charges GTK 0.3767

Table 4-8 - Unit Cost TablePage 3 of 3

August 2001 Page 70

1 Coal_coke2 Brown_coal_lignite3 Crude_oil4 Gasoline_petorleum_gas5 Gases6 Ferrous_ore_scrap7 Ores_&_ferrous_metals8 Slag_ash9 Non-metals_except_sand_&_gravel

10 Iron_steel11 Ferrous_metal_products12 Non-metal_products13 Lumber14 Firewood_cork15 Cement16 Sand_&_gravel17 Limestone_bricks_building_materials18 Glass_&_glass_products19 Fertilizers20 Wheat21 Wheat_products22 Sugar_cane23 Fresh_fruit 24 Fresh_vegetables25 Live_animals26 Meat_&_Fish27 Milk_&_dairy_products_eggs28 Sugar_&_sugar_products29 Spirits30 Food produts31 Livestock_feed32 Oils_&_fats33 Hide_varnish_&_similar34 Textile_products_fibres35 Used_paper36 Cardboard_resin_distillation_agents37 Other_chemical_products38 Acids_and_liquified_gases39 Metal_producs40 Road_vehicles41 Rail_vehicles42 Machines_engines_boilers_apparatus43 Wood_produts44 Cardboard_paper45 Miscellaneous46 Cars47 Containers-loaded48 Containers-empty49 Khupepak 50 Transportation_by_SPT-49_free51 Transportation_by_SPT-49_paid52 Subtotal_of_goods53 Used_packing_material54 Other_goods55 Part_loaded

Table 4-9 - FREIGHT COMMODITY TABLE

August 2001 Page 71

SKOPJE_N 2970 3015MADZARI 3330 5040SKOPJE_P 3960 4155TOVARNA 3645 3495LISICE 4290 5295DRACEVO 4335 6525ILINDEN 3435 6750TRUBAREVO 3810 5925MILADINOVCI 2970 6990ROMANOVCI 2565 7020VELES 4740 6930GRADSKO 5730 7725DUBROVO 6570 8235GEVGELIJA 7710 9195BITOLA 6135 4545KREMENICA 7230 4890G_PETROV 2130 2595VOLKOVO 1530 2265RADUSA 2970 2145JEGUNOVCI 3480 1215TETOVO 4395 1080GOSTIVAR 6315 1650ZAJAS 7260 1890KICEVO 8055 2355TAJMISTE 7380 600SIVEC 6150 7230KUMANOVO 1995 6930TABANOVCI 945 7050KUMANOVO_N 1935 8295BELIAKOVCI 1650 9705OVEC_POLE 5010 8445STIP 5790 9825SOKOLARCI 5085 10335KOCANI 4575 11265YANCOVIC 615 1860PRILEP 5610 5655GUMNO 5800 5000SAPOTNICA 5800 4500SOLUN 8565 10140

Table 4-10 - NODE TABLE

ANNEX A

ENHANCEMENT OF THE COSTING SYSTEM OFMACEDONIAN RAILWAYS

A recent report prepared for Macedonia Railways, Program for Restructuring of the Public Enterprise “Macedonian Railways for the Period 2000-2003 prepared by Dr. Aleksandar Petrovski

In a previous study, an initial traffic costing model was installed at AR using data available at the time. Since then, significant improvements have been made to the information system of AR. The objective of the present study is to take advantage of the improved data to enhance the costing system.

Specific Tasks for the Consultant

A. Consultant will review the current status of AR’s information system, projected information system development, and current status and applications of the costing system . The consultant will study in particular:

The status of the accounting structure and the progress made toward an activity-base chart of expense accounts;

The status of the operating statistics

The availability of link-specifi train information

The availability of terminal-specific shunting information

The availability of wagon history information

B. Consultant will produce a design of an improved costing system consistent both with existing and with anticipated developments.

C. With the aid of a local counterpart, consultant will collect the costing model input and incorporate it into the costing system

Task Schedule

Task A – review current status: two person-weeks (PW)

Task B – Design improved system: ( 1PW)

Task C – Collect data and incorporate into system – 8 weeks

Two trips to Macedonia for a total of eight weeks. MZ to provide office space and report translation. Consultant will pay own interpreter

August 2001 Page 72

Completion schedule – Inception report – 4 weeks after commencing work

First draft 12 weeks after commencing work

Final report: three weeks after acceptance of draft report by the client

August 2001 Page 73

August 2001 Page 74