Edition June 2025

Michelle Phillips, the Transnet Group Chief Executive, speaks with the calm assurance of someone who knows the high stakes of her job. 

Her tenure comes at a time when South Africa’s state-owned logistics utility is under intense pressure to reform, recover and regain trust. For her, the post is more than a job. “What we do in Transnet is not a job. It is not an occupation. Our purpose is to move people out of poverty,” she said firmly.

The CEO made the reflections during a recent exclusive tour of the parastatal’s cutting-edge manufacturing site in Pretoria.
Transnet, once the crown jewel of South Africa’s freight logistics network, has weathered a devastating decline in performance since the 2017/18 financial year. By 2022/23, freight rail volumes had plummeted to just  149 million tons – a shadow of the company’s former capacity.

Phillips addressed this reality head-on: “We have been in decline since 2017/18. In 2023, we implemented our recovery plan. Within six months of implementation, we have managed to take this business in a different direction.”

While she takes measured pride in her team’s accomplishments, Phillips remains grounded in reality. “While we are happy with the turnaround, we do not want to pat ourselves on the back too much yet. Yes, we have finally stopped a five-year decline, but that is just the beginning.”

Positive turnaround

By the end of the 2024/25 financial year, Transnet reported an improvement in rail volumes. “We recently closed our 2024/25 financial year having moved 161 million tons of freight. While we fell short of our 170 million-ton target, we have made it clear to industry stakeholders and customers that this represents a 9 million-ton improvement over last year,” she said.

Phillips was unequivocal about the financial and structural difficulties facing the parastatal.

“Transnet is not a bottomless pit for public funds. We do not receive a single cent from National Treasury. Instead, we raise capital in the open market – borrowing money that we then invest directly back into this business”.

She emphasises that negative narratives surrounding both Transnet and South Africa have serious financial consequences. 

When we talk badly about our country and about this state enterprise called Transnet, it makes it difficult for me and my team to secure funding, she explained.

For Phillips, supporting Transnet transcends corporate recovery; it’s about protecting thousands of livelihoods. “We have almost 51 000 people in Transnet alone. I do not want to see anyone of them losing their job,” she stated firmly. 

Cultural transformation

A cornerstone of Phillips’s mission has been driving cultural transformation throughout the organisation. For an organisation long burdened by mismanagement and inefficiency, she insisted meaningful change was underway – extending far beyond operational improvements. “This is a different Transnet,” she declared. “We are busy changing the culture in this organisation. We work with integrity and with the utmost of ethics and truthfulness.”

She acknowledged, with refreshing candour, that her leadership credentials have faced questioning in the past. “People will question me because I am not an engineer...But I am very, very firm on this micro solution towards the growth of this country,” she said.

One of the gravest challenges Phillips raised was the ongoing sabotage and criminality targeting Transnet’s infrastructure. This represents a national crisis, she argued — one that requires every South African to actively protect public infrastructure and support national development.

What resonated most powerfully in Phillips’ impromptu address was her unwavering belief in South Africa, even against a backdrop of widespread cynicism. “This is a good country to be a part of, a good country to build in. I do not want to be a part of building any other country but this country”.

She expressed a concern with the national tendency toward negativity. “Too often you have guides in other countries who will take you throughout their country. They do not talk about the fact that they are living in poverty and in shacks and that they are struggling. They talk about the good things that their country and the government have been doing. I wouldd like us as South Africans to start doing the same thing.”

The road to recovery

The road to recovery remains long and fraught with challenges, but Phillips said that the determination to rebuild was already taking root within the organisation – and the country. “We still have a lot of work to do. We have not arrived yet.”

Her message serves as both a rallying call and a clear statement of intent. “We are extremely challenged... but we are working very hard to get Transnet out of the red and into the black...We believe that next year we will be in that position.”

She concluded with an unmistakable resolve: “The responsibility of leading Transnet is not something that just fell into my lap. I take this responsibility very seriously.” 

In May, Transport Minister Barbara Creecy  approved a R51 billion guarantee facility for Transnet in support of the entity’s capital investment programme.  The facility will also enable it to meet its debt obligations.