Rail industry lambasts DB’s largest ever track price increase programme

Image: Deutsche Bahn AG Hans-Christian Plambeck

Deutsche Bahn’s intention to raise rail route prices in Germany has been faced with strong criticism. The planned increase would take effect from next year. It would be the largest price increase ever. Industry representatives like the German private rail association Die Güterbahnen have strongly denounced the plans. 

The German Bundesnetzagentur has approved the application from the German infrastructure manager DB InfraGO for a route price increase. The increase of 16,2 per cent will be the largest ever, according to Die Güterbahnen, and even larger than initially expected.

From December 2024, the price per kilometre for a standard freight train will grow by 52 cents and amount to 3.73 euros. Since the current regulatory framework for route pricing came into force in 2016, all previous price increases have together amounted to merely 23 cents.

Profits

The private rail association points out that DB InfraGO has been formally oriented towards the ‘common good’ since 1 January 2024. However, the association decries current regulations and DB InfraGO’s supposed focus on profits.

“The main driver is the maximum profit claim permitted by law that the state-owned company can realise in its prices,” says Die Güterbahnen. Neele Wesseln, the organisation’s managing director, also states that the federal government’s decision to cut 50 million euros from track price subsidies has prompted DB InfraGO to pursue higher revenue.

Die Güterbahnen heavily criticises Germany’s regulatory framework for route pricing. “The only characteristic of the route pricing system is the helplessness of customers and the licensing authority. From the beginning, we criticised the fact that DB and the federal government wanted to make profits from the monopoly of the rail infrastructure,” says the association.

It also points out that the current regulatory framework establishes a maximum on financial returns as a share of DB InfraGO’s capital stock. Therefore, “as a result of the federal government’s annual equity injections that began in 2019, the possible profit claim that DB InfraGO AG can realise from the customers it serves will automatically increase. If the federal government carries out its intention to grant the currently planned additional funds of 20 billion euros for the rail infrastructure as equity and not as a subsidy, the profit claim will literally explode in the following years.”

Common good

Die Güterbahnen expresses its dissatisfaction with government policy and ridicules DB InfraGO’s official work for the ‘common good’. “The government had a good two years to intervene and correct the system. It didn’t use it and is now standing in front of the rubble. The biggest joke of all is DB Netz AG, which was recently renamed to become DB InfraGO AG, which is oriented towards the common good. The corporate goal of making a profit was never removed from its statutes, and it now makes extensive use of it,” says the rail association.

“Instead of reducing costs when demand declines, it will pass on increasing costs plus profits to the railway companies and will thereby reduce the proportion of climate-friendly freight transport by rail. According to the current figures from 2023, DB InfraGO achieved an increase in sales with fewer train paths sold because of its prices, which were also increased in 2023. Fantastic—at least for the DB and its owner, the Federal Government.”

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Author: Dennis van der Laan

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