Travel north on the east coast mainline, the main London to Edinburgh route, and you may spot the gift John Smith received from colleagues last year.
The huge sign, which stands metres away from the line just north of Peterborough station, carries the Sunderland AFC emblem alongside two arrows, one pointing 85 miles south to Wembley, the other 188 miles to the club’s Stadium of Light. “The lad who did it was a Newcastle supporter, so it was through gritted teeth,” says Smith, the boss of GB Railfreight and a lifelong Sunderland fan.
The sign stands next to a maintenance depot – the first depot GB Railfreight owned after it was launched in 1999.
Initially a branch of the now defunct rail operator GB Railways Group, the freight business, which Smith was asked to launch, was aimed at making the most of new opportunities after rail privatisation in the mid-1990s.
From winning its first contract in 2001, GB Railfreight has become one of the largest freight companies in the UK, alongside DB Cargo and Freightliner, operating 173 trains and employing more than 1,400 people. In that time, its ownership has changed four times, with M&G’s infrastructure arm Infracapital its current owner, but Smith has remained at the top of the company.
It has also diversified away from freight during this period, with GB Railfreight operating all maintenance trains for the Elizabeth line tunnels, while also providing the drivers for the Caledonian Sleeper train between London and Scotland.
But transporting goods is its core business. This includes moving aggregate for construction, fuel for power stations (such as the Drax biomass plant in Selby, North Yorkshire), and large containers from the UK’s deep seaports in Southampton, Felixstowe and London Gateway near Thurrock in Essex.
The railways are in his blood. Smith was born in Weston-super-Mare, Somerset, but as a result of his dad working for the RAF, he moved around a lot. He regards Alnwick in Northumberland as the place where he spent his most formative years – particularly in terms of what football team he chose to support.
A teenage trainspotter, he says he would often tell his mum he was just visiting nearby York station before travelling as far down as London to seek new trains. He also admits he still has a model railway in his garage, which he continues to enjoy when he gets time between managing fullsize trains.
“Back when I was growing up, it’s what young boys did, and it led to quite a few people taking careers in the railway,” he says.
Starting out as an apprentice in a carriage works in York, he then became an engineer. Getting a national certificate, he studied at Loughborough University before starting a four-decade career in the railways, 25 of these leading GB Railfreight. “The railways was great as a nationalised industry back then because it allowed you to travel: you could apply for jobs here, there and everywhere,” he says.
However, while nationalisation offered early career opportunities, he has reservations over whether Labour’s plans to fully renationalise passenger services will fix all of the UK railway’s problems.
“There will be many good railway people who get buried in how they set this all up, the legislation, taking the bill through parliament,” he says. “It is going to be so diversionary, and kind of moves away from a train going from A to B.”
Freight has largely been spared any moves to nationalise, but Smith still fears there might be some impacts on the business, particularly if freight carriers lose their protections under current legislation.
“If rules aren’t clear, then, for example, the mayor of Manchester might say, ‘I don’t want freight trains running through Manchester Piccadilly to Trafford Park. I’m going to stop it all’,” he says. “If the law allows them to do that, then that’s a risk.”
Smith clearly knows the business back to front. He greets every colleague he bumps into at the Peterborough HQ by their first name, and can talk in detail about the status of each one of its trains as we walk through the business’s nerve centre, its operations room.
A straight talker, he describes a former unnamed transport secretary as a “pillock”, while telling the story of how he had to explain just how much the UK economy relied on deep-sea imports.
He is also not afraid to criticise government over decisions he disagrees with, including the deal it struck with the unions to end the long-running pay dispute that has blighted passenger services over the past two years. “I was surprised that a settlement was reached without any productivity benefits,” he says. “I think it’s fair to say that, particularly after two years of disruption suffered by the public on the passenger side, to come out with nothing seemed a little bit strange.”
But it is chancellor Rachel Reeves’s budget he reserves his biggest criticism for, describing it as “brutal” for business. “What they’ve decided to do in the budget is not business-friendly at all and that has concerned a lot of businesses,” says Smith.
“It’s about people acting entrepreneurially, it’s about developing businesses, and you’ve got that sense of negativity.”
In 2023, the company made an operating profit of £28m on revenues of £321m. Smith says the environmental benefits of transporting by rail rather than road are clear. GB Railfreight estimates that an average freight train carries the same amount as 129 lorries, and reduces emissions by 74%.
And it intends to go further, having invested £150m – its largest ever investment – in a fleet of 30 new electric-plus-diesel bi-mode locomotives, whose engines will run on vegetable oil and significantly reduce emissions. The environmental benefits are recognised by the government, which has set a target of growing rail freight by 75% by 2050.
However, despite these targets, Smith feels policies still benefit road freight more than rail. He points to fuel duty, which has been frozen since 2011, as a prime example.
“Over the last five years, what we pay for fuel and track access charges, the cost of our wagons has gone up by 25%, while fuel duty hasn’t gone up at all,” he says, explaining his trains have to travel at least 200 miles to be able to compete on price.
Despite the headwinds UK businesses face, Smith says his company will continue to invest in the business and its fleet, to make it greener and more sustainable and secure its long-term future.
“At the end of the day, the diesel locos we use in 20 years’ time, when I’m six foot under, they’re not going to be the mainstay of rail freight,” he says, getting ready for his next meeting. His mode of travel? Rail, of course.
CV
Age 63
Family Married to Lesia with two sons – Marki and Leksi.
Education Archbishop Holgate’s school, York; mechanical engineering at Loughborough University.
Pay The company’s highest-paid director received £657,000 in salary and performance-related bonuses in 2022, according to company accounts.
Last holiday Mauritius.
Biggest regret Missed attending the 1973 FA Cup victory for Sunderland.
Best advice he’s been given “‘You know it makes sense’, engraved on the inside of my wedding ring.”
Words or phrase he overuses “We are where we are.”
