But SBB faces several challenges, as CEO Andreas Meyer explains to Anitra Green.

DESPITE record passenger figures and SBB Cargo achieving its first profit in 40 years, 2013 was a difficult year for Swiss Federal Railways (SBB). Overall profit dropped by nearly 44% to SFr 238m ($US 268m) while operating expenses rose by 4.3%. Added to this were a series of accidents and additional track maintenance costs, followed this year with the news that its large order for double-deck long-distance trains from Bombardier would be delayed by two years to 2016.

SBB's financial situation is less than satisfactory on three fronts. The extra revenue generated by a 5.2% fares increase in December 2012 was insufficient to cover the cost of higher train-path prices and providing more services, resulting in a drastic drop in the passenger division's profit to SFr 96m, just over a third of the 2012 figure.

Moreover, track maintenance costs exceeded budget by SFr 128.6m. This was partly due to years of under-estimating the increased wear-and-tear from greater use of the network, while the detection rate of track flaws was higher following the purchase of a new diagnostics vehicle.

On top of all this, SBB's debt has risen steadily and has now reached SFr 7.5bn. At a time when public-sector grants for regional and railfreight services are decreasing, current profit levels are not enough to cover these extra costs.

The good news is that Switzerland's Financing the Upgrading of Rail Infrastructure (Fabi) programme was approved by a convincing 62% majority in February's national referendum. It comprises an open-ended rail infrastructure fund (BIF), a strategic development programme dubbed Step and a proposal to fund the first phase up to 2025 with projects totalling SFr 6.4bn. Fabi is an important milestone, as SBB CEO Mr Andreas Meyer points outs: "We cannot spend more on maintaining the infrastructure than we get from the government. But it will probably take until 2016 before it starts to take effect."

Last year's accidents, including a regional train crash in which a train driver was killed, prompted SBB to accelerate the implementation of a project already underway to install speed-monitoring systems at 1700 signals. "There can be no compromise over safety," Meyer says.

SBB is now examining the possibility of bringing forward the planned introduction of continuous speed monitoring in conformity with ETCS level 2. "The original plan was to introduce ETCS by 2065, but due to various incidents, it became clear that it has to be speeded up," Meyer says. "The aim is to have it ready sometime between 2030 and 2040, but it depends on capacity and funding from the government."

Andreas-MeyerThe SFr 1.86bn contract with Bombardier for 59 double-deck Twindexx trains is the largest order ever placed by SBB and is part of an ambitious programme to invest SFr 1bn a year in rolling stock over several years. One of the features of the trains is new tilting technology. Although Bombardier's specially-developed Wako system will provide compensation of just 2o, this will be the world's first tilting double-deck train, and the technology is proving more challenging than expected, but it is not the only cause of the delay.

"Part of the delay was due to the new Swiss law regarding the needs of disabled passengers," Meyer says. This requires low-floor access and accommodation for wheelchair-bound passengers, necessitating design modifications. "We also did a lot of functionality tests with maintenance, cleaning and so on, which took time. But most of the delay is due to engineering problems by Bombardier."

Bombardier has admitted to a design fault, and has agreed with SBB that the first trains will only include one unit fitted with Wako, which Meyer says can be retro-fitted on the other trains once it has proved satisfactory. "We need these trains," Meyer says. "Bombardier is doing its best to keep to our common aim, but we can't deviate from the agreed price."

There has also been a delay in ordering trains for operation through the Gotthard base tunnel which is due to open in 2016, and the winner of the tender for 29 high-speed multi-system trains will only be announced this month. "We should perhaps have ordered them earlier, but it took time to work out what we actually wanted," Meyer says. One reason for the delay was again the new provision for disabled passengers. The gap will be filled by eight new ETR 610 units and another seven being brought back from Trenitalia. "There will be trains for the tunnel," Meyer asserts.