Freight train units at Liepāja railway station, Latvia. License link:

Despite efforts, gloomy market conditions force LTG to release employees

Freight train units at Liepāja railway station, Latvia.

Lithuanian Railways are forced to release around 2,000 employees in an attempt to cope with the increasing financial losses. The company has consulted with employee representatives and will proceed to their release in a controlled manner, allocating 6 million euros for their compensation. The decision will be implemented despite LTG’s intense efforts to improve the situation.

The employees’ gradual release will affect all business units belonging to the group. LTG Cargo will count most of the losses with 1,200 employees leaving the company. LTG Infra will lose 500 employees, while LTG’s passenger branch will lose 300.

“The volume of business has shrunk very sharply and noticeably, so to adapt to the changed situation, we must respond to it accordingly. Painful solutions are needed now, but we want them to be sustainable. First, we must continue to provide quality and competitive services to our customers. Secondly, by reducing the team, we must secure opportunities for its future growth as we find niches for further activities. Third, by saying goodbye to part of the team, we will strive to assist these employees in adapting to the ongoing change fully. They ensured the smooth operation of the Group, so it is important for us that they can successfully continue their professional career elsewhere”, commented Egidijus Lazauskas, CEO of LTG.

150 million losses

LTG has been facing harsh conditions for quite some time. A partial exclusion from New Silk Road routes due to political tension with China and the loss of Belarusian volumes due to US sanctions on the country already cornered the company that forecasted millions of losses.

The war in Ukraine and the respective sanctions on Russia were the icing on LTG’s cake. In 2022 the Lithuanian company expects to transport around half the cargo compared to 2021, resulting in 150 million euros lost. “This will be the largest drop in cargo volumes and the lowest volume of cargo transported in the company’s history”, stressed LTG.

Efforts still in place

Regarding cargo operations specifically, LTG is doing its utmost best to keep the situation stable. Apart from diversifying operations and its market reach with new routes to Germany and Poland, for instance, the company also decreased freight transport rates significantly. “It is expected that freight rates will drop by 64 per cent” to make services more appealing to customers, commented the company. The dropping tariffs from LTG Infra, Lithuania’s rail infrastructure manager, made the rate decrease possible.

On top of that, the LTG came up with an action plan to embrace its financial recovery by focusing on efficiency, reduced costs and diversification. Lazauskas explained that “a partnership is also being developed with Latvian and Estonian colleagues to increase the transportation of the Ambertrain train between Western Europe and the Baltic States, and discussions are underway with representatives of Kazakhstan on cargo transportation to Klaipeda port.”

Still a lot of potential

Despite the difficulties, LTG responded swiftly to most challenges appearing on its way. This time the situation might be more complex and demanding; however, the company and the Baltic country have much more potential to explore and new possibilities on the horizon. With its focus now turned to the west, Lithuania can attract new volumes from hubs like Duisburg, while new corridors through Poland can open the way to southern and south-eastern Europe.

Moreover, there are more possibilities for freight flows coming from the east, as the discussions with Kazakhstan suggest. The port of Klaipeda could play a critical role in forwarding cargo towards Scandinavia and receiving cargo from there that can be forwarded to mainland Europe and further.

Are you interested in learning more about Lithuania and its potential? On 14-15 June, we organise the RailFreight On Tour-The Lithuanian Edition in Vilnius, where we will discuss the possibility of a profitable rail business in Lithuania and the broader Baltic region. Take a look at the event page here and register here.

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Author: Nikos Papatolios

Nikos Papatolios is editor of, the online magazine for rail freight professionals.

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