Switzerland’s Freight Future: EUR 192M for DAC, Intermodality, and Innovation

Switzerland is no stranger to precision, but this time it's not clocks—it's freight. With EUR 192 million earmarked for Digital Automatic Coupling (DAC), terminal upgrades, and combined transport subsidies, the Alpine nation is wiring up its railways for a greener, smarter future—one wagon retrofit at a time.

The funding, announced alongside new legislative measures, will support the retrofitting of thousands of wagons and locomotives with Digital Automatic Coupling (DAC) technology, while also providing significant support for rail terminals and combined transport infrastructure. In this way, Switzerland recognises that targeted public investment is crucial if rail is to compete with road freight over the long term.

Subsidy Levels Based on Vehicle Age

According to Swiss transport outlet Bahnonline, the funds will be directed toward equipping approximately 15,000 freight wagons and 520 locomotives with DAC. What makes Switzerland’s approach stand out is the detailed differentiation in subsidy levels based on the age of the rolling stock. Freight wagons built after 2010 and registered before 1 January 2026 will be eligible for CHF 10,000 each, while those manufactured between 1995 and 2009 will receive CHF 5,000. Locomotives can qualify for up to CHF 75,000 in support, provided that they remain in active service for at least five years following the retrofit. This clear framework gives operators financial certainty and incentivises early participation.

The government expects that public contributions will cover 30 to 40 percent of the total cost of DAC retrofitting, easing the burden for private operators while keeping market discipline intact. The funds will be managed by a newly created distribution body, and recipients must submit detailed inventories of eligible vehicles, including year of manufacture, to the Federal Office of Transport (FOT). This pre-approval mechanism is designed to streamline disbursements and prevent fraud, while also offering the state visibility over the deployment process.

Legislation and Logistics: Terminal and Combined Transport Support

Beyond vehicles, the legislation also introduces comprehensive support for intermodal logistics facilities. The new framework allows for both existing terminals and new construction projects—located within Switzerland or abroad—to apply for DAC-related infrastructure subsidies. The key condition is throughput. Eligible terminals must handle at least 720 full train units annually or process 5,000 twenty-foot equivalent units (TEU) per year. Modernisation efforts can receive up to 40 percent of costs, while new terminal builds qualify for up to 50 percent. In cases where a terminal is deemed to have national significance, the state will provide up to 80 percent of the required funding.

These subsidies are not a blank cheque. Switzerland has built accountability mechanisms into the funding model. If a terminal fails to meet performance expectations—defined in terms of operational volumes—within five years of receiving support, the FOT reserves the right to reclaim a portion or all of the funds. This performance-based approach is intended to ensure that subsidies lead to lasting improvements in capacity and service, rather than short-term fixes.

Switzerland is also incentivising combined transport as part of its modal shift strategy. Operators will receive CHF 40 for every wagon used in combined transport, provided the associated routes meet the 720-wagon threshold, with a cap of 8,000 units per operator. For newly established terminals, this threshold will be waived during the first six years of operation, offering them a runway to scale up without risking disqualification. This mechanism reflects a nuanced understanding of the investment cycle in freight infrastructure.

In tandem with the financial measures, the government will revise national transport legislation to align legal structures with the technical requirements of DAC. This includes incorporating DAC implementation guidelines and expanding the legal basis for terminal and transhipment support. These adjustments will provide regulatory clarity for all stakeholders and help accelerate the transition from pilot programmes to commercial deployment.

Switzerland Invests $211 Million in Digital Coupling DAC - Railway Supply//t.co/6MUwuplV85

— Kathie (@TheCrimsonWorm) September 10, 2024

While DAC has been the subject of cautious debate across Europe, Switzerland’s approach shows what can be achieved with focused investment, clear legislation, and strong accountability. By supporting both digital coupling and broader infrastructure, the country is not just preparing for DAC—it is laying the foundation for a more competitive, resilient, and green freight sector. Other European states may want to take note.