International Railway Journal - January 2008 - (Page 17) H UNGARIAN State Railways (MÁV) is in the midst of the biggest upheaval in its history. The vertically-integrated structure that was in place for more than a century is being swept away with the creation of a holding company, infrastructure manager and separate business units, a process which will be completed by the end of this year. As IRJ went to press, MÁV was due to submit its final structural plan to the government, which must ensure that MÁV’s new structure is fully compliant with European Union legislation. “In the last 160 years there has been no single change as big as the restructuring of the last 18 months,” MÁV CEO Mr István Heinczinger told delegates at Terrapinn’s CEE Rail 2007 conference in October. The reform of MÁV is proving immensely challenging for an organisation which, until recently, had changed little since the end of communism in 1989. “The railway was very much part of the state and it did not care about its customers,” explained Heinczinger. “Getting away from this attitude is one of the biggest challenges for rail in central and eastern Europe, and I think it will take 15 years to achieve a customer-oriented railway.” MÁV is, by Heinczinger’s admission, a long way short of government or customer expectations. The average age of the locomotive fleet is more than 35 years, speed restrictions are in force on 44% of the network, and 40% of Budapest commuters are travelling without a valid ticket. Furthermore, the railway continues to make a loss and is saddled with huge long-term debts. “The inefficiency of MÁV is not accepted by the government, the railway or the railway’s customers,” he said. In July 2006 the government unveiled its latest set of reforms for passenger transport, giving regions the power to determine who provides local public transport and the timetables they operate to. MÁV has therefore been required to synchronise its timetables and tariffs with those of state-owned bus operator Vólan in an effort to achieve a more integrated public transport system. “The government says it will not finance parallel services - for instance, where bus routes serve the same corridors as railway lines,” Heinczinger explained. “This means MÁV has to improve service levels if it is to receive the subsidy it needs to run specific services.” The Transport Ministry has instructed MÁV’s newly-formed passenger division, MÁV Start, to improve its efficiency, even if this means reducing the size of the network. MÁV Start intends to withdraw all services on 38 branch lines by the end of 2008 and 21 of these lines, totalling 751km, were due to close last month. “Bus services are more comfortable for people served by marginal lines because there has been no money available to upgrade rolling stock or infrastructure to an acceptable minimum level,” said Heinczinger. “The companies that built the diesel railcars used on these lines no longer exist, so there is a shortage of spare parts which means maintenance is becoming a problem. We would need to replace 200 of these railcars, when the money is urgently needed to fund new trains for urban areas.” The two railway unions reacted furiously to the closure plans, which would result in further job losses, and with opposition already mounting to controversial pension reforms, railway employees went on strike at the end of October, and twice in November. MÁV says even if it receives Forints 6 billion ($US 35 million) more than the Forints 110 billion subsidy allocated for 2008, it would still have to suspend passenger services on all 70 of its branch lines. With the possibility of cross-subsidy from MÁV’s more profitable operations evaporating as reforms take effect, difficult decisions will have to be made about how - or if - services will be funded on Hungary’s remaining branch lines. Ageing fleet MÁV is also facing issues with ageing locomotives and rolling stock. “Many locomotives are over 35 years old and this is becoming a big challenge for the traction and maintenance division,” says Heinczinger. Investment in new rolling stock is already underway with a fleet of 30 Flirt emus currently being delivered by Stadler, Switzerland, and a further 30 ordered in December at a cost of ƒ141.6 million. Last September, MÁV issued tenders for 25 dual-voltage electric locomotives with options for up to an additional 25. It says it will purchase up to 100 of these locomotives by 2013. This year MÁV Start plans to issue tenders for 45 intercity emus (15 of which will be equipped for international operation) and 10 more Bombardier Talent emus. It also plans to buy 185 locomotive-hauled intercity 17
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