Montekargo, Montenegro’s majority state-owned railway company, reported a loss of €1.58 million in the past financial year, a 163% increase compared to the €602,225 loss in 2023. The company primarily provides freight transport services within Montenegro and neighboring countries.
The management attributes the poor results mainly to strong competition from road transport, which benefits from better infrastructure, lower fixed costs, and higher commercial speeds. Road transport’s flexibility and “door-to-door” service appeal have led to a decline in rail competitiveness over the past two decades, especially for high-tariff goods. Montekargo mainly transports bulk goods unsuitable for road transport and serves companies with industrial sidings.
The company also faces competition from private rail operators, which it claims operate unfairly by violating regulations regarding worker qualifications, work hours, and safety standards, creating discriminatory conditions.
Economic recovery in Montenegro remains slow, with local rail transport accounting for less than 1% of total freight volume in recent years. Montekargo lacks the capacity to independently compete in the rail market and aims to build stronger partnerships with neighboring rail operators and logistics companies, particularly in the Port of Bar, to improve commercial presence. However, progress is hindered by unclear revenue-sharing mechanisms.
Additional challenges included a two-month transport blockade caused by a strike at the Nikšić bauxite mine, an ecological ban on transporting copper concentrate in open wagons requiring costly adjustments, a landslide near Kruševo limiting train weight, and disruptions from the Ukraine war affecting transport routes and cargo volume.
Despite these difficulties, Montekargo has reduced costs in non-safety-related areas and continues to focus on improving service quality. Management prioritizes cooperation with Serbia Kargo and Albanian Railways to enhance service, explore market opportunities, and resolve operational and commercial issues related to freight transport.
