Job cuts

The head of freight traffic at Germany's rail service, Karl-Friedrich Rausch, recently told newspapers there are "no long term jobs" for 2,400 employees, and that another 1,500 jobs would be cut as part of "structural adaptation measures" in light of the ongoing economic crisis.

Now, the board of directors has officially acknowledged the cuts, according to daily newspaper Die Welt. The freight carrier will close down 72 freight yards and cut a total of 4,000 jobs. The move is part of a larger cost-cutting program at Deutsche Bahn, which plans to trim 14,000 jobs over the next five years.

However, there will be no operational cuts before the end of 2010 due to union agreements, the company said.

Larger cuts are planned

Traffic at Deutsche Bahn's freight unit, DB Schenker Rail, is deep in the red this year. Die Welt reported that 8,500 employees - more than a third of the company's workforce - had their hours reduced between March and September.

"We have to react to the reduced transport volumes, which dropped by one quarter," Schenker Rail chief Alexander Hedderich told Die Welt. "In everything that we do, we will take into account the long-term predictions for growth in freight traffic."

In mid-term planning Deutsche Bahn as a whole said it would drop 14,000 jobs by 2014, and is pinning its hopes on attrition. A jobs accord between unions and the rail company expires at the end of December, 2010.

The rail union Transnet has sharply criticized the plans.

"It shows that management was not up to snuff," said Transnet's acting chairman Wolfgang Zell. The company was using the economic crisis to disguise its plans "to boost its annual yields," he claimed.

"All experts expect that there will be a massive increase in freight tax revenues," Zell said. "Instead of developing an offensive strategy, the management can only think of closures and cuts."

Deutsche Bahn has already cut 13,000 jobs over the past five years.

jen/Reuters/AFP
Editor: Sam Edmonds