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Make Way – for Healthy Competition Competitor Report Railways 2019/20

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Make Way – for Healthy Competition Competitor Report Railways 2019/20 MAKE WAY – FOR HEALTHY COMPETITION COMPETITOR REPORT RAILWAYS 2019/20 . Infrastructure CAPACITY SHORTAGES AND REGULATORY IMPOTENCE . Passenger transportation MORE OPTIONS – FOCUS ON QUALITY . Freight traffic DIVERSE TRAINS DOMINATE . Human Resources · Innovation · Data Management PERSONNEL URGENTLY NEEDED EVERYWHERE CONTENTS 2-11 Infrastructure CAPACITY SHORTAGES AND REGULATORY IMPOTENCE 12 -19 Passenger transportation MORE OPTIONS – FOCUS ON QUALITY 20 -27 Freight traffic DIVERSE TRAINS DOMINATE 28 -32 Human Resources · Innovation · Data Management PERSONNEL URGENTLY NEEDED EVERYWHERE 33 ABOUT US FORWARD DEAR READERS, Politicians and a broad majority of the general public want more rail traffic. We need to significantly strengthen our railways in order to achieve our climate protection targets for transportation, increase transportation safety and reduce road traffic. This has already been verbally highlighted in party platforms, the coalition agreement of 2018 and the recent climate protection concept 2030. The stage is now set for the long-promised renaissance of the railway and we can begin to shift transportation away from roads and air travel. And it’s high time. Rail transportation has indeed grown since the publication of the fifth “Competitor Report Railways” shortly after the federal elections in the autumn of 2017. However, the modal split shares have not changed significantly in passenger or freight transportation; overall economic growth momentum is likely to have been the main driver of rail growth. Improved rail services, road congestion and the new wave of environmental awareness have all contributed to this development. The majority of the intermodal competitive disadvantages of the railway continue to persist. 25 years after the railway reform, competition in local freight and passenger transportation on the railways remains largely fair. Long-distance traffic, on the other hand, continues to be almost completely dominated by the DB Group, whose infrastructure companies often make life unnecessarily difficult for all railway companies. Dialogue between DB and the competitor railways has intensified, but everyday problems have only really diminished in just a few areas. We therefore believe that policies need to be implemented to reorganise the railway in the near future. In the 6th “Competitor Report Railways 2019/20”, we have once again highlighted the competitive situation and analysed measures which could really strengthen the railway. The long version has been published on our website. We hope you find the report enjoyable and insightful! Ludolf Kerkeling Christian Schreyer CEO NEE e.V. President mofair e. V. INFRASTRUCTURE Infrastructure generates an increasing contribution to the profits of Deutsche Bahn AG. The revenues of the DB as a whole come mostly from the infrastructure companies. In 2018, this highly regulated companies made up for more than 50 % of the total profit. In the first half 2019, it became a record 69 %. INFRASTRUCTURE CAPACITY SHORTAGES AND REGULATORY IMPOTENCE In contrast to road traffic, by far the largest share of the network is in the hands of the federal government; approximately 90% of the German rail network is managed by the network subsidiary of Deutsche Bahn AG, based in Frankfurt, as a “natural monopoly”. There is no competition between railway networks, but rather within the DB rail network between transport companies, which are simultaneously and above all in intermodal competition with private transport and road, air and sea transport companies for passengers and freight. The previously ubiquitous the legislation has confirmed Federal Monopolies Commission systematic obstruction of access some dire predictions and has recommended, in its biennial to the rail network with the aim of shown a need for action so that sector report, “the favouring DB’s own transport the law can make a contribution implementation of an ownership- companies has become much towards the modal shift to rail. related, vertical separation less commonplace in recent Important fields of action include between the infrastructure and years. Nevertheless, the transport the system of train route pricing transport sectors of the DB Group companies are dissatisfied with and approval, criteria for and [...] the limitation of the the service and performance of scheduling and handling federal government’s ownership DB Netz AG in many respects. timetable conflicts as well as of the DB Group to the regulated They criticise the business policy information and application rights parts of the company.” In the or call on the Federal Network of the Federal Network Agency coalition agreement in 2018, the Agency to intervene. when dealing with the only truly government partners, particularly dominant network operator. The upon the instigation of the SPD, The regulatory authority has legal protection of those with stipulated that the privatisation of made good use of its very narrow access authorisation when the railways (meaning DB AG) scope as defined by the Railway dealing with the infrastructure was as out of the question as Regulation Act (ERegG), which operator must also be improved. splitting the “integrated group”. has been in force for three years. This categorical position has Under pressure from the DB Competing companies not within become the status quo. The Group, the federal government the DB Group continue to previous argument of preventing has guided the development of experience disadvantages redundancies due to business EU directives and their compared to the DB transport operations with an intra-group transposition into national law companies due to the informal labour market is irrelevant in view primarily in the interests of the coordination of the Group of the current staff shortages. An federation, but with minimal Executive Board and at the independent and more network- consideration of user and working level, the continuous oriented company management growth-friendly aspects. The rotation of executives, the lack of of infrastructure operators in fact political evaluation of the law as competitor railway makes more sense for the railway agreed in the Coalition representatives in supervisory system. At the same time, Agreement of 2018 has not yet bodies as well as the sheer size of transport service provider been tackled by the Federal the group and the special competition between DB Ministry of Transport and, attention that the federal companies and other companies according to experts, is not likely government gives its “own” would become fairer if there were to result in any significant company. no longer any systematic proposals for changes if it is advantages for DB Group carried out by the Ministry of Infrastructure as a service companies. Furthermore, there is Transport itself. However, from provider for rail transport? simply no need for public the perspective of the competitor transport companies. In a first railways, initial experience with In the summer of 2019, the step, the rail transport companies which are bundled within the DB Group and which currently threshold (2009: 50.3%). The at the “Construction Site compete with each other could value was just 45.6% in 2017, 38% Management Round Table”, in be opened up to further, in 2008 and only 18% in 2004. technical discussions and, since sustainably oriented investors. the summer of 2019, also at the Secure and environmentally The resulting excessively high newly established “Capacity sound capital investments are in train route prices made it Round Table”. However, high demand, particularly in the possible, for example, for DB Netz substantial progress takes time. areas of fixed-income and AG’s profits to increase from EUR The concern is that railway pension funds. 119 million in 2017 to EUR 509 operations which, according to million in 2018. DB the intentions of politicians, are There can be no going back to Station&Service posted a profit of expected to provide significantly organisation within an authority EUR 176 million in 2016, EUR 186 increased transport services, will for the competitive and growth- million in 2017, with a slight suffer for many years from the oriented operation of the rail increase in 2018 at EUR 190 consequences of the improperly infrastructure. However, the million. Following a EUR 35 million dimensioned infrastructure. It is newly founded surplus in 2016, DB Energie therefore all the more important Bundesautobahngesellschaft closed the year 2017 with a profit that the implementation of all GmbH gives a hint as to how this of EUR 59 million before reporting capacity-increasing measures be type of task can be organised – a significant decline to EUR 12 tackled in parallel and that a namely profit-free, as expected million in income after tax in simple financing and planning by citizens and the economy and 2018. solution be found for smaller in contrast to the approach taken measures such as additional by DB infrastructure companies. Bottlenecks reflect many years of switches. Other forms of organisation are missed expansion opportunities conceivable, but due to In the 25th year after the railway categorical resistance from DB There has also been only a reform, there is a wide range of and some politicians, these have moderate increase in average estimations: while DB AG and the not even been assessed using a capacity utilisation in the federal government celebrated scientific systematic comparison previous two years. According to the modernisation, traffic growth under the current conditions. The DB
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