freight transport subsidiary of Deutsche bahn
DB Cargo has to cut substantially more jobs than previously known
Updated on December 8, 2024 – 6:00 p.mReading time: 2 min.
The job cuts at Deutsche Bahn’s freight transport subsidiary are larger than previously known. A total of 5,000 jobs will be lost.
The ailing freight transport division of Deutsche Bahn will have to cut significantly more jobs than previously assumed. “the current economic forecasts mean that we expect a loss of 5,000 jobs by 2029,” said DB cargo boss Sigrid Nikutta to the German Press Agency. This increases the previously expected job cuts as a result of the change of DB Cargo.
So far, only the reduction of 2,300 jobs has been agreed with the works councils. A large part of the additional jobs will be eliminated in governance, but the operational area will also be affected.
Nikutta wants to achieve this primarily thru natural fluctuation. “Around 1,000 employees will have left the company as early as 2024, essentially as the baby boomer generation of employees is now retiring,” she said.
Around 650 colleagues have already received new job offers within the railway group. A further 700 employees would leave the company as part of a voluntary exit program. From a cargo viewpoint, this reduces the remaining need to cut jobs over the next five years to around 2,650 jobs.
Sharp criticism comes from the Railway and Transport Union (EVG). “Sadly, it is typical for DB Cargo that you cannot rely on management’s promises. The bad news always comes in bits and pieces,” said EVG board member Cosima Ingenschay, who is also deputy chairwoman of DB Cargo’s supervisory board, to the Berlin “Tagesspiegel”.
“Sending away everyone who isn’t on the clock at three is not the right way,” said Ingenschay. You also lose a lot of employees who are urgently needed in order to grow again at some point.There is a great risk that more and more transport will be shifted to the road in the coming years. “This is a fatal signal for the transport transition.”
The company has been making heavy losses for years. according to a decision by the EU Commission, these will no longer be allowed to be offset by the parent company in the future. DB Cargo now has untill 2026 to get out of the loss zone.
That’s why the company, the EVG railway union and the works councils have been fighting for a far-reaching savings program for months. In October, all sides agreed to cut an initial 2,300 jobs. However, Nikutta had always emphasized that other jobs coudl be affected. According to DB Cargo, it has around 31,000 employees.
What are the main challenges currently faced by DB Cargo in the freight transport sector?
Interview between Time.news Editor and transport Expert
Editor: Good afternoon,and welcome to Time.news! Today, we have a very vital topic to discuss—recent developments concerning DB Cargo, the freight transport subsidiary of Deutsche Bahn. Joining us is Dr. Elena Schneider, a renowned expert in transportation economics. Thank you for being here, Dr. Schneider.
Dr. Schneider: Thank you for having me! it’s a pleasure to discuss such an critically important issue.
Editor: Ther have been reports that DB Cargo is facing the need to cut significantly more jobs than initially expected. What can you tell us about the reasons behind this decision?
Dr. Schneider: Absolutely. The logistics sector, particularly rail freight, has been under immense pressure due to multiple factors, including a decline in demand, rising operational costs, and increased competition from other modes of transport like road freight. These challenges have forced DB Cargo to reassess its workforce needs.
Editor: It sounds quiet challenging. What specific factors do you believe have contributed to this increase in job cuts?
Dr. Schneider: Several elements are at play here. The impact of the COVID-19 pandemic is still being felt, as freight volumes did not bounce back to pre-pandemic levels. Additionally, the current energy crisis and inflation are driving up costs for rail operators. This combination of economic stress and decreased demand creates a tough habitat for companies like DB Cargo.
Editor: These job cuts can have broad implications. What could be the potential impacts on the labor market and the overall freight transport industry?
Dr. Schneider: Job cuts in such a important firm can lead to uncertainty in the labor market, especially in regions heavily dependent on rail freight employment. Moreover, if major players like DB Cargo cut back, it can potentially lead to a ripple effect, causing smaller competitors to reconsider their staffing and operational strategies.This could, in turn, impact service levels and freight rates across the entire industry.
Editor: Given these challenges, what strategies do you think DB Cargo might consider to stabilize its operations and workforce in the long run?
Dr. Schneider: One crucial strategy would be investing in technology and innovation to improve operational efficiency. Automation and data analytics can optimize routes and reduce costs.Additionally, exploring new markets and diversifying services could help mitigate risks associated with reliance on conventional freight modes.
editor: That makes a lot of sense. What can other transport companies learn from DB Cargo’s current situation?
Dr.Schneider: Companies need to remain agile and proactive in monitoring market trends. diversification of services and a strong focus on sustainability could be key. the rail industry is shifting towards greener solutions, and aligning with this trend can not only attract business but also align with regulatory pressures for environmentally amiable practices.
Editor: Thank you, Dr. Schneider. This has been incredibly insightful. As DB Cargo navigates through these tough times, it’s crucial to keep the conversation going about how the industry can evolve and adapt.
Dr.Schneider: Thank you, and I look forward to more discussions on this vital topic in the future!
Editor: Absolutely. Thank you for joining us, and to our viewers, stay tuned for further updates on this evolving story.