Works council agrees
DB-Cargo is restructuring itself with job cuts: 2,300 jobs gone
October 10, 2024, 5:12 p.m
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The logistics division of Deutsche Bahn has long been a problem child for the group. After a long dispute with the EVG union, a restructuring concept was agreed upon. This involves setting up new business units – and cutting more than 2,000 jobs.
The ailing rail freight transport subsidiary DB Cargo has decided on a restructuring concept after months of disputes with the works councils and the Railway and Transport Union (EVG). This includes, among other things, the reduction of 2,300 jobs, as the company announced.
In addition, new business units are to be founded in order to be able to focus more closely on customer needs. These are the steel, automotive, chemicals and raw materials as well as consumer goods segments.
“Each business unit works like an independent company, has its own staff, its own locomotives and its own freight wagons,” Cargo continued. “And: She has full responsibility for the quality, the transport performance and the financial result.”
Combined transport remains under the corporate umbrella
There is no longer any talk of the originally planned outsourcing of so-called combined transport – such as container traffic from seaports or terminals – to a corporate subsidiary. It was said that combined transport would remain under the umbrella of DB Cargo. Outsourcing was one of the main points of contention between the employers and the works councils.
However, the logistics market environment remains difficult, a company spokesman said. “We will respond to this and expect further significant adjustments.” This means that even more jobs could be lost, particularly in administration.
The general works council agrees
According to its own information, the general works council has approved the concept. After months of disputes, there is now an agreement on the future of the group.
“Approval was not easy for us,” said the deputy chairwoman of the Railway and Transport Union (EVG) and the Cargo Supervisory Board, Cosima Ingenschay. “DB Cargo was put in a difficult economic situation due to mismanagement and a lack of political environment.”
There are therefore no plans for operational layoffs. According to the EVG, a social plan and a program for voluntary resignation were decided upon. “That was also difficult, but given the current situation it was an acceptable decision,” emphasized Ingenschay. With the agreed measures, the board now has all the tools in hand to get the group back on track for the future.
Cargo has been in crisis for years
DB Cargo says it has 31,000 employees. The company has been making heavy losses for years. In the first half of this year alone, the operating loss before interest and taxes (EBIT) was more than 260 million euros.
A large part of the losses occur in so-called single-wagon traffic. Loads are collected directly from industrial customers and the wagons are assembled into long trains at marshalling yards. These are then decoupled again at the destination station and the wagons are transported further individually.
Many experts believe that this offer cannot be operated economically. The federal government therefore supports single-wagon traffic with funding.
EU state aid proceedings are still ongoing
A state aid procedure by the EU Commission is currently still open. Since the beginning of 2022, the authority has been checking whether the federally owned railway group can offset losses at DB Cargo via a so-called profit transfer agreement. It is already clear that the Commission will prohibit this approach.
DB Cargo will therefore have to stand on its own feet financially in the future. It is also conceivable that the Commission will order that individual cargo business areas be outsourced as part of the procedure.