Romania’s rail freight company CFR Marfă paid only half the wages of its employees this month as the company’s accounts have been frozen by infrastructure manager CFR SA, to whom it owes more than 100 million Euros.

The salary shortcoming was reported by Economica.net. According to the Romanian media outlet, CFR Marfă’s accounts are blocked on a monthly basis. In this manner, CFR SA is able to recover part of the debt. The recovery of the large debt has been a major topic of debate in Romania. According to some media outlets, the debt is leading CFR Marfă into bankruptcy.

Debt recovery

At a meeting with the trade unions on 20 April, Transport Minister Lucian Şova asked CFR SA to recover the debts. At the end of April, thousands of industry players took to the streets, requesting the Ministry of Transport to resolve the critical situation of Marfă.

In March 2017, the Association of Romanian Private Rail Freight Operators filed a formal complaint with the Commission alleging that CFR Marfă had received state aid. This would be in breach of EU rules, it stated. The European Commission opened an in-depth investigation into the state support, an investigation still ongoing.

Planned investments

CFR Marfă announced the planned investments of 17.5 million Euros this year, according to Romanian news site Hotnews. The company plans to upgrade 13 locomotives, including 6 diesel-electric, 6 electric and a diesel-hydraulic locomotive and repair 40 locomotives. Moreover, CFR Marfă will modernise 600 freight wagons of various types.

According to the same site, CFR Marfă currently owns a fleet of 907 units, of which 422 are active. Of these, 193 are electric locomotives, 138 are diesel-electric and 81 are hydraulic diesel. The freight wagon fleet is made up of 13,000 units, which provide transportation of coal, ore, bulk cargo, cereals, chemicals and petroleum products.
On the national freight market, rail transport has a share of about 15 per cent.

Unlike passenger rail transport, the freight rail transport market is highly competitive, with numerous private operators, some having gained considerable market share following liberalisation of the market in 2007. CFR Marfă holds a share of 6.8 per cent and private railway operators about 8 per cent. However, CFR Marfă has been in financial difficulties since at least 2009.