ÖBB awaits €33bn

The Austrian government coalition has decided to inject more than 30 billion Euros into Federal Railways (ÖBB).

Werner Faymann’s Social Democrats (SPÖ) and the team of People’s Party (ÖVP) ministers agreed yesterday (Weds) to support the railway company with 33 billion Euros. The money will be invested in the coming years. The subsidisation is supposed to help to reduce ÖBB’s debts from 27 to 18 billion Euros by 2017, according to government sources.

SPÖ and ÖVP agreed in February that the Vienna-based firm – which is headed by ex-Verbund AG board member Christian Kern – must spend 920 million Euros less than initially planned on current and upcoming infrastructure projects in the coming five years. None of the country’s major railroad tunnel construction projects are at risk due to the cutbacks, according to the government.

Especially the Koralm, Semmering Brenner basis tunnel constructions are under close scrutiny by independent public transport experts due to soaring costs and various disputes between ÖBB and local residents.

Sebastian Kummer of the Viennese University of Economics and Business (WU) appealed to the SPÖ-ÖVP government to stop the planned Brenner basis tunnel construction. He labelled the operation set to take place in Tyrol as the least reasonable among the various envisaged railroad infrastructure projects.

Kummer claimed the coalition decided not to pull the plug on the disputed project for political reasons. He made aware that provincial elections would soon take place in Tyrol. The Semmering and Koralm tunnel initiatives were mainly “politically motivated” as well, according to Kummer. Delaying some parts of the constructions will not help slashing costs, he warned. Expenses will rather go up stronger than planned due to various aspects such as the inflation, Kummer added.

Meanwhile, bosses of ÖBB affiliate Rail Cargo Austria (RCA) want to increase the firm’s activity in Eastern Europe (EE), Germany and Italy. RCA manager Erik Regter said the plan was to tighten cooperation with Hungarian railway company MAV concerning the usage of cargo terminals and other issues. He added that the number of RCA trains operating between Italian port city Trieste and the German cities of Munich and Ulm was set to climb. RCA also intends to start cargo transportation from Trieste to Budapest, Hungary, Regter revealed.

ÖBB recently decided to spend more on the replacement of worn-out seats on trains and a higher standard of customer service quality as the battle for passengers intensifies. The state-funded company is competing with Westbahn, its first private rival in domestic passenger railroad services, since December 2011.

Westbahn – which is headed by former ÖBB manager Stefan Wehinger – operates between Vienna and Salzburg. The private firm stops more often on the 300-kilometre service than ÖBB’s Railjet trains to give people the chance to get to the office by train instead of car. ÖBB manages an extensive network of regional links but its Intercity and Railjet services attract rather tourists than commuters.