Members of the European Railway Wheelset Association (ERWA) have expressed concerns for the future of the industry after revealing production costs have increased by 20% since the beginning of 2008.
At an annual meeting of the association in Krakow last Thursday, the association's members discussed the "critical situation" within the industry, caused by the sharp increase in the price of steel.
ERWA has called on all manufacturers of railway wheels and wheelsets to pass on these extra costs to their customers promptly, as the current situation is believed to be too unpredictable to provide reliable, quality goods in these economic conditions.
Furthermore, planned increases in energy prices scheduled for later this year are expected to compound the industry's woes.
The dramatic rise in the cost of steel has resulted from the prices of some of its constituent materials, namely iron ore, pig iron and cocking coal increasing globally for 2008.
A shortage of scrap steel during April and May 2008 has further exacerbated the problem according to ERWA.