Deputy CEO Kalin Petrov reveals Discordia’s Mobility Package plans

The rules on road transport implemented in the new EU Mobility Package are now a reality. According to research by Transport Intelligence, the impact of the measures will be a reduction in capacity in the EU market, as well as increased freight rates and CO2 emissions. Among those believed to be most affected are logistics companies from countries like as Bulgaria and Romania, who have called for some Mobility Package rules to be scrapped in an open letter signed by the haulage associations of 6 CEE countries. One of the most recognisable carriers in the region is of course Bulgaria's Discordia, whose bright yellow trucks, trailers and containers can be seen throughout Europe.

Deputy CEO Kalin Petrov reveals Discordia’s Mobility Package plans
Photo: Discordia

Given the scale and scope of Discordia’s business, the new rules no doubt represent a challenge. Curious to find out how the well-known Bulgarian logistics company is meeting these difficulties head on, we reached out to Kalin Petrov, the company’s Deputy CEO, for a quick Q&A.

Read on to find out:

  • How the company may set up an entity in Western Europe
  • To what degree cabotage is important to Discordia
  • To what extent the business wants to expand its overall logistics capabilities
  • How attractive the UK market is to the company
  • The modernity of the company’s fleet

Bulgaria’s road transport association was one of many from Central and Eastern Europe to request that the EU remove the return truck obligation in the mobility package. However, as it stands, the rules won’t be changed. In light of this, what changes are Discordia making in order for the company to run as efficiently as possible and meet the needs of customers? 

This is one of the most controversial rules, which contrasts with the EU’s carbon reduction policies. There is an ongoing trial about it in the European Court.

We will await for the outcome of the trial and then we will determine our long-term solution for the regulation. Meanwhile, our current business model allows us to reorganize our activities in compliance with the new rules without reducing the efficiency of our operations.

If this obligation remains unchanged, we will most likely acquire or establish a company in a Western European country with a highly developed economy. This will allow us significantly to increase our activity there.

Hauliers from Poland and the Czech Republic have lower operational costs than their western neighbours, but are also located much closer to lucrative markets than road transport businesses from Romania and Bulgaria. Do you feel the mobility package has now given those companies an unfair advantage?

This is the case for most of the companies and it is a fact that this rule is unfair and creates an unequal environment for companies from different countries.

Here at Discordia, we have invested in many technological solutions and have optimized many processes in our organization. This allows us to maximize benefits from the opportunities provided by the environment and to minimize the negative effects from external threats.

We are convinced that each barrier on the market is an opportunity for us to manage better with it than our competitors. In addition, if this rule remains, we will most likely have own company in Western Europe, which will give us additional advantages over our competitors from Poland and Czech Republic.

The UK has relaxed cabotage rules recently, allowing unlimited domestic trips within a two period. The relaxation is due to end at the end of April. If this relaxation was to be relaxed until the end of the year or made permanent, would this make the UK a more attractive destination for Discordia and other road transport companies from Bulgaria? 

Cabotage is not our priority. We are focused on international transport. Most of our transport to the UK is from Germany, France, Italy and Spain.

We will not be changing our strategy due to temporary changes. We could only benefit from them if they match our strategy. If there is a permanent decision in this direction, then we would consider future changes in our business.

The UK has also decided to implement specific elements of the mobility package, including the salary requirements for posted workers. Do you feel that the country could benefit from removing this requirement? It could encourage more hauliers from Europe to do work in the country, thus reducing the need for drivers and the strain on supply chains post-Brexit. 

Even before the discussions on the Mobility package, the remuneration of our drivers was at the level of their colleagues in Western Europe, and currently they are even in their upper range. Therefore, this regulation affects us only by its heavy administration requirements, which also affects all transport companies in the EU.

The UK will find solutions to its problems and we would support them if they are in accordance with our strategy.

Besides road transport, Discordia provides container, air and rail transport. Do you foresee the company growing in any of these areas in the near future? Much has been made recently about rail freight picking up, especially amid the driver shortage and the motivation to reduce CO2 emissions. 

Discordia is a transport and logistics company. Our transport business has developed faster in recent years, but we are determined to support the development of our logistics activities both through organic growth and acquisitions in countries like Germany. We have clients from 59 countries, 27 of which are in Europe, which we serve including by rail, sea and air transports. Our growth in container, air and rail transport for 2021 is more than 90%.

We are interested in investing in multimodal transport. We expect to see how the new regulations from the Mobility package will be applied to deliveries to the final destination in multimodal transport. Then we will decide if we will make such an investment.

How does Discordia plan to upgrade or expand its fleet? There are lots of considerations to be made at the moment when it comes to larger cabs for drivers, high fuel costs, and the pressure to cut carbon footprints. 

We use our trucks for 3 years, then we sell them. Therefore, our trucks are the most ecological and the newest in Europe. The average age of our 1,000 trucks is 1.5 years and all are Euro 6. Our trucks are equipped with the most advanced technologies and provide the highest level of comfort and safety to our drivers.

Because of the configurations of our trucks and our eco-driving program, we have an average fuel consumption of 15% -20% lower than our competitors in Europe. In this way, we produce 10-15 tons less carbon emissions per year, with each of our trucks compared to the average European truck. That is why we are proud to be one of the most environmentally friendly fleets in Europe.

When the technologies for alternative fuels are sufficiently developed and have the necessary infrastructure to be used in long-distance heavy transports, we will be one of the first companies in Europe that will swiftly replace the entire fleet.

In what ways has Discordia been using more digital tools in recent years to streamline its operations? 

We invest a lot of money in digitalization and automatization of our processes. We are among the leading technology companies in our sector and we are using all existing advanced technologies available to us. In the future, we intend to continue to invest a lot in these areas.

The technologies allow us to provide our customers faster deliveries, precise and quick information about their transports.

Finally, what are the company’s plans and goals for 2022 and beyond?

By the end of 2022 we plan to have more than 1,300 trucks, by 2025 to reach over 3000 trucks, and by the end of 2030 we have the ambition to be one of the leading transport and logistics companies in Europe.

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