The Netherlands Sabotages European Rail Freight by Favoring Road Diesel
79 million euros over three years to develop multimodal transport, against an immediate tax exemption for heavy-duty diesel fuel. The Netherlands perfectly illustrates the gap between Europe’s rail ambitions—increasing its market share from 11% to 30% by 2030—and national policies that continue to favor road transport.
This Dutch contradiction reveals the European impasse on rail freight. The European Union displays the objective of tripling rail’s share in terrestrial goods transport, but its member states maintain massive fiscal advantages for trucks while under-financing alternative infrastructure.
The Essentials
- Europe aims for 30% modal share for rail by 2030, compared to 11% currently
- The Netherlands allocates 79 million euros over three years to multimodal transport, but exempts road diesel starting July 2026
- Transferring 9.75% of road freight to rail would reduce energy consumption by 85% and emissions by 76%
- The European rail sector has been demanding equitable taxation between rail and road for a decade
79 Million Against the Dutch Road Lobby
The Dutch multimodal strategy, presented in January 2026, promises to “create equitable conditions” between rail, road, and waterways. In practice, it allocates 26.3 million euros per year—or 0.005% of Dutch GDP—to modal transfer projects. This envelope must finance connections between ports, rail terminals and industrial zones, as well as the digitization of freight procedures.
In parallel, the Netherlands is introducing a tax exemption for heavy-duty diesel fuel starting July 1, 2026. This measure, demanded by the employer organization Transport en Logistiek Nederland, directly reduces road transport costs at a time when the government strategy claims to rebalance transport modes.
This dual policy comes as no surprise to Rail Freight Forward, the European alliance of rail operators. According to their calculations, every euro invested in modal transfer generates 4 to 6 euros in environmental and social savings. But road lobbies have political influence that rail struggles to match: in 2025, the European road transport association IRU counted 180 national organizations, compared to 9 for Rail Freight Forward.
The energy efficiency of modal transfer nonetheless remains significant. Studies by the European Environment Agency show that a transfer of 9.75% of road freight to rail would reduce energy consumption by 85% and CO2 emissions by 76% for the ton-kilometers involved. This performance is explained by the physics of transport: a freight train transports 40 to 50 times more goods than a truck with the same energy consumption per ton-kilometer.
The 2030 Objective Stumbles on National Taxation
Europe’s ambition to bring rail to 30% of terrestrial freight by 2030 requires tripling its current market share. This progression would require massive investment in rail infrastructure and reform of transport taxation. Yet most European states maintain fiscal advantages for road transport that date back to the 1960s.
France has partially exempted professional diesel since 1965. Germany has applied a reduced tax on diesel since 1951. Italy subsidizes road goods transport through partial fuel reimbursement programs. This advantageous taxation represents between 15 and 25 billion euros in annual public subsidies to road transport according to estimates from Transport & Environment, the European clean transport NGO.
In contrast, rail investments are stagnating. The European rail network requires 700 billion euros in modernization by 2030 according to the International Union of Railways. National and European public credits barely reach 50 billion per year, with only 20% for freight. This disproportion explains why European rail has been losing market share for twenty years, falling from 19% of terrestrial transport in 1995 to 11% in 2024.
Private rail operators denounce this unfair competition. DB Cargo, the freight subsidiary of Deutsche Bahn, pays infrastructure tolls for every kilometer traveled, while trucks use the A7 motorway between Hamburg and Munich free of charge. This difference in fiscal treatment represents 0.15 euros per ton-kilometer transported in favor of road, according to calculations by the European Railway Agency.
Multimodality Remains a Niche Market
Despite official rhetoric, multimodal transport—which combines rail, road, and waterways—remains marginal in Europe. It represents 4% of total freight, concentrated on a few corridors linking Northern ports to German and Italian industrial zones. This low penetration is explained by technical and regulatory obstacles that public investment struggles to overcome.
Transshipment terminals constitute the weak link in the system. Europe has 400 multimodal terminals, compared to 2,000 in the United States for comparable territory. Most are under-equipped: 60% do not have cranes capable of handling 45-foot containers, the growing standard in international trade. This technical limitation forces shippers to use less optimal 40-foot containers or resort directly to road transport.
Administrative procedures further complicate the multimodal equation. A rail-road shipment between Rotterdam and Milan requires 14 different documents and involves 7 parties, according to a McKinsey study on European corridors. The same transport by direct truck requires 3 documents and 2 parties. This administrative complexity adds 48 hours to transit time and 150 euros in costs per container.
Digital technology could simplify these procedures, but interoperability between national systems remains deficient. The European Digital Transport and Logistics Forum project, launched in 2021, aims to create a unique “digital passport” for multimodal shipments. Three years later, only 6 member states had connected their customs systems to this platform, slowing adoption by transport companies.
Some companies circumvent these obstacles by creating their own integrated ecosystems. Samskip, a Nordic operator, owns its vessels, trains, and terminals between Scandinavia and continental Europe. This vertical integration allows it to offer rail-sea transit times competitive with “all-road” transport. But this strategy remains inaccessible to small transport companies that form 85% of the European freight market.
European Rail Corridors Seek Their Cruising Speed
The central European network, completed in 2023, connects 94 cities via 9 transnational rail corridors. These infrastructures theoretically allow transporting a container from Hamburg to Naples in 18 hours, compared to 24 hours by road. But actual performance struggles to meet these theoretical objectives.
The Rhine-Alps corridor, Europe’s busiest, illustrates these difficulties. It transports 180 million tons of goods per year between Northern ports and Northern Italy. Yet its rail share has stagnated around 15% for ten years. Bottlenecks persist: the Basel-Chiasso section can only circulate 220 trains per day, half of the potential demand according to RailNetEurope.
This saturation pushes operators toward hybrid solutions. India is building its high-speed rail network at one-fifth the cost of Japan’s, demonstrating that it is possible to industrialize rail infrastructure. In Europe, costs remain prohibitive: a kilometer of new line costs between 15 and 40 million euros, compared to 3 to 8 million in India for comparable technical standards.
Automation of rail freight could reduce operating costs. DB Cargo has been testing autonomous trains on certain German routes since 2024. This technology allows capacity to increase by 30% on existing lines by reducing intervals between trains. But it requires harmonization of European signaling systems, a project launched in 2008 and still being deployed.
Private operators develop their own networks to circumvent institutional slowness. Captrain, a subsidiary of SNCF Connect, operates 15,000 wagons across 25 European countries in partnership with industrial shippers. This downstream development strategy—starting from customer needs rather than existing infrastructure—generates 8% annual growth, above the sector average.
Decarbonization Drives Toward New Equilibria
Carbon taxation gradually transforms the economic equation of goods transport. The inclusion of road transport in the European emissions trading system, scheduled for 2027, will add 45 to 75 euros per ton of CO2 to truck costs. This increase represents 3 to 5 cents per kilometer for a heavy-duty vehicle, or 15 to 25 euros additional for a Paris-Berlin journey.
This tariff evolution will make rail more competitive over long distances. Calculations by the European Environment Agency show that a carbon price of 60 euros per ton would equilibrate rail-road costs for journeys exceeding 500 kilometers. Below this threshold, road’s advantages in flexibility and speed would maintain its dominance.
Companies are anticipating these changes by renegotiating their logistics contracts. Ikea has committed to transporting 70% of its European goods by rail or waterways by 2030, compared to 45% currently. This transition requires rethinking warehouse organization and accepting slightly higher inventory levels to compensate for rail’s reduced flexibility.
Green hydrogen could disrupt these equilibria by decarbonizing road transport. Mercedes has been testing hydrogen trucks with 1,000 kilometers of range since 2025. If this technology reaches commercial maturity, it could maintain road’s competitiveness against climate requirements. But costs remain prohibitive: 4 euros per kilogram of green hydrogen, compared to 1.50 euros for equivalent energy diesel.
European rail freight has a four-year window to prove its capacity for adaptation. The 30% modal share objective by 2030 requires doubling infrastructure investment and fundamentally reforming transport taxation. Without these structural changes, Europe risks missing its logistics transition despite its stated climate ambitions.
Sources
- Rail Freight Forward / RailFreight.com - Dutch freight strategy focuses on multimodality but with little money to back it up
- European Environment Agency - Report 2025 on multimodal transport in Europe
- Transport & Environment - Fiscal advantages in European freight transport 2025
- International Union of Railways - Infrastructure needs assessment 2024
- McKinsey - European freight corridors efficiency study 2025