GERMAN Rail (DB) reported a 10.6% increase in long-distance passenger traffic in the first half of 2016 to 66.7 million journeys compared with the first half of 2015, while the load factor improved from 51.8% in the first half of 2015 to around 60% this year in part due to extensive promotional fares and increased quotas for cheaper advance tickets.


DB longAccording to the German government’s statistical service Destatis, 131 million people travelled on long-distance rail services in 2015, an increase of 1.9% over 2014, almost all of whom were carried by DB as there is currently only one minor open-access operator. DB managed to increase passenger numbers despite suffering the effects of multiple strikes by its train crew which disrupted services over several months. Whilst DB’s performance in 2015 was not stellar it was an improvement on 2014 when long-distance passenger numbers fell by 1.1% with many former rail users switching to long-distance buses, which were liberalised in January 2013.

Long-distance buses pose a real competitive threat to DB. Bus traffic has grown from almost nothing in 2012 to 21.8 million passengers in 2015 operating on 330 routes. Traffic is expected to grow by a further 25% this year to reach 27.2 million passengers.

Two start-up operators MeinFernbus and Flixbus, which included former DB managers, captured around 60% of the long-distance bus market within two years. The two companies merged in January 2015 under the Flixbus brand and with the backing of German and US private equity investors Flixbus has expanded rapidly into several neighbouring EU countries.

Earlier this year Flixbus acquired the Postbus operation from Deutsche Post, Germany’s second-largest bus operator, and the European Megabus operation from Stagecoach, Britain. As a result, Flixbus now has an 87.1% market share in Germany. The next biggest bus operator is DB through its subsidiaries Berlin Linien Bus (BEX) and IC Bus.

In the three years since long-distance bus de-regulation DB’s long-distance profits have fallen by nearly half as it has been forced to reduce its yield per passenger by around 50%, while passenger numbers and revenue have remained fairly constant. DB’s long-distance division made a profit of €171m on revenues of €3.9bn in 2015. While revenues were marginally lower than in 2014, profit was down by €9m. However, DB’s financial performance is still well below that of 2013 and 2012 when its long-distance division achieved profits of €263m and €304m respectively. In both years passenger journeys were constant at around 130 million annually.

Up to now, DB has faced very little competition from open-access train operators. Veolia Verkehr withdrew from the market in December 2014, a victim of stiff bus competition, leaving only HKX which operates a round trip on four days per week on the Cologne - Hamburg route. However, a new challenger called Locomore plans to introduce a daily Stuttgart to Berlin service from late 2016.

In March 2015 DB announced plans to significantly expand its long-distance network in Germany. ICE high-speed train frequencies will be doubled on core routes while conventional inter-city (IC) services will be expanded, re-connecting 25 cities which have not been served by long-distance trains for at least a decade.

IC services will start to be expanded this year, but the network will not be fully in place until 2032 as it partly relies on electrification schemes that have yet to be financed. Eventually the new IC network will serve all cities with a population above 100,000 offering at least one train every two hours. Direct long-distance connections are planned to counter the long-distance bus operators which already serve these cities and are now targeting towns with populations as low as 20,000.

In some cases, such as the planned IC route linking Frankfurt am Main, Siegen and Münster, the expansion of the IC network is being partly facilitated through agreements with local transport authorities to accept their tickets on sections of route in return for payments to DB. Such agreements are not new although the expansion is leading to objections from competing regional rail operators.

To make rail more attractive, a range of cheaper tickets and much improved Wi-Fi and mobile phone reception on existing trains is promised from this year, something which is already available on long-distance buses.

Significant journey time reductions are also planned as DB reaps the benefit of substantial infrastructure investment during the last 10 years with further new high-speed lines set to open over the next decade. Completion of the Leipzig - Nuremberg high-speed line in December 2018 will reduce Berlin - Munich journeys by 2h 5min, while the opening of the Stuttgart - Ulm high-speed line in December 2022 will cut 30 minutes off Stuttgart - Munich trips.

Other infrastructure improvements in the next decade include the completion of the upgrading of the Karlsruhe - Basle main line to increase it to four tracks with a maximum speed of 250km/h, as well as design work for new high-speed lines connecting Hamburg and Bremen with Hannover, and Frankfurt with Mannheim.

DB forecasts 5 million people will switch from car or bus to rail thanks to the expanded network and higher train frequencies. The number of services operated will increase by around 25%, while train-km will grow from 130 million in 2015 to 162 million in 2030. The improvements are intended to boost passenger-km from 36 billion in 2015 to 49 billion by 2030.

However, DB admits it needs to significantly improve the punctuality of its long-distance services in order for the plan to be successful. Only 76.5% of long-distance trains were on time in 2014 compared with regional and commuter services which achieved punctuality levels of between 93.1% and 97.7%.

New fleet

DB plans to operate the future ICE/IC network with 360 trains. Siemens is building a fleet of 130 ICE4 (formally known as ICx) trains which will replace some ICE1 and ICE2 trains between 2017 and 2025 as well as some locomotive-operated IC trains. The ICE3 and ICE-T high-speed fleets will be refurbished, with work starting in 2017. A batch of 16 Velaro-D class 407 320km/h EMUs entered service between 2013 and 2015 and now operate all DB high-speed services linking Germany with France. In addition, there are plans to purchase up to 120 new IC trains, many of which will be double-deck, for services within Germany as well on on some routes into neighbouring countries such as Stuttgart - Zürich and Berlin - Amsterdam.

Despite onboard catering reportedly losing €78m per year, all of the new ICE4 trains will have restaurant cars as DB considers catering on trains to be a key part of its offer and a differentiator from competing modes.

The first of the 12-car, 830-seat, ICE4 pre-series trains is due to enter service this month followed by the first series-production trains in December 2017 where they will start to replace ICE1 trains on the Hamburg - Hannover - Munich and Hamburg - Berlin - Munich routes.

DB will need 120 new trains between 2016 and 2032 to operate its expanded IC network replacing most if not all of its 1445 IC coaches, 770 of which have been refurbished in the last five years. DB has already ordered 44 new IC trains from Bombardier, each comprising a Traxx AC locomotive and five Bombardier Twindexx IC Dosto coaches operating in push-pull mode. The first 27 of these trains, which DB has branded IC2, should be in service by December, with the remaining 17 IC2 sets following next year. DB expects ICE4 and the new IC trains such as the IC2 to reduce energy consumption by 20% up to 2030.

While DB is investing heavily to expand its daytime IC network, it says that all of its overnight services comprising couchette and sleeper cars, together with its car-carrying overnight trains, will cease operation in late 2016, citing losses of €31m on a turnover of €90m. To replace them, a limited number of ICE trains will run overnight between major German cities. However, Austrian Federal Railways (ÖBB) intends to take over the operation of several routes serving German cities as well as those in neighbouring countries offering sleeper, couchette and seated accommodation plus some car-carrying services.

With significant investments underway or planned in both new trains and infrastructure, DB should be well placed to increase its share of the growing long-distance passenger market in Germany. It acknowledges that its performance in terms of punctuality or cancellations has not been anywhere near good enough - especially as customers now have more choice than ever before. DB’s plans to remedy past mistakes will stand it in good stead provided it delivers the levels of reliability and punctuality that rail passengers in Germany expect.


Berlin - Munich high-speed line nears completion

GERMANY’s chancellor Mrs Angela Merkel opened the new 123km Leipzig/Halle - Erfurt high-speed line on December 9 2015 with ceremonies in both Leipzig and Erfurt. ICE services started four days later with Erfurt - Berlin journey times reduced by 50 minutes to 1h 45min and cross-country journeys such as Dresden - Frankfurt by an hour to 4h 15min.

The €2.74bn Leipzig/Halle - Erfurt section is a key part of a €10bn project to create a new high-speed corridor - between Berlin and Munich enabling journeys in under 4 hours for the first time when it opens in December 2017.

The project was agreed by Germany’s federal and state governments shortly after German re-unification in 1990 as part of the German Unity Transport Project (VDE) covering the 515km route between Berlin and Nuremberg.

The project is divided into three parts:

  • Berlin - Leipzig/Halle upgrading, completed inMay 2006
  • Leipzig and Halle to Erfurt new line, opened December 2015, and
  • Erfurt - Nuremberg, involving new line construction to Ebensfeld and upgrading from there to Nuremberg, and due to open December 2017.

Work to complete the Berlin - Munich route is well advanced. Electrification of the complex new-line section from Erfurt south to Bavaria through the hills of the Thüringenwald was due to be energised on September 1 to enable testing to start later this year. The last section of track to be rebuilt in Bavaria from Ingolstadt to the suburbs of Munich is also nearing completion.

The Berlin – Nuremberg line is designed for mixed operation by freight trains and high-speed passenger trains. Four loops are provided at roughly 20km intervals on the Leipzig - Erfurt section to enable ICEs to overtake freight trains. Connections are provided at Gröbers to enable freight trains to access the freight terminals at Leipzig-Halle Airport and the intermodal terminal at Leipzig-Wahren.

However, DB told IRJ that while freight trains could use the new line now, it depends on the rail freight operators and so far no requests for paths have been received. When the southern section of the line opens from Erfurt to Bavaria it is likely that freight operators will start to use the new line as it offers a less-steeply-graded alternative to the current route.