PKP CARGO's Vision for Intermodal Transport Discussed at Rail Freight Workshop

On November 5, 2024, Dr. Marcin Wojewódka, acting President of PKP CARGO S.A., participated in a debate titled 'European Funds for the Development of Rail Freight Transport'. The event, organized by the Ministry of Funds and Regional Policy, the Centre for EU Transport Projects, and the ProKolej Foundation, aimed to address challenges in rail freight and explore solutions to the current crisis.

Challenges and Opportunities in Rail Freight

As the largest entity in the Polish rail market, PKP CARGO faces considerable challenges but also possesses ample resources and opportunities for growth. Dr. Wojewódka mentioned the need for a shift towards intermodal transport, stating, "We must be aware that coal will soon run out. That is why we are moving in the direction of intermodal transport because we know that if we do not switch to this direction when the coal runs out, our coal wagons will have nothing to do." He pointed out the importance of this transition for the company’s future and the necessity for the industry to adapt to rapidly changing market expectations.

According to the PKP CARGO press release, participants at the workshop discussed key instruments to support the rail industry, identifying potential areas where railways could take overloads from road transport. Marketing freight services and building strong relationships with new customers were also significant debate themes.

A Vision for the Future

Dr. Wojewódka is optimistic about the future of PKP CARGO, stating, "We are deeply convinced that in two to three years when PKP CARGO will have restructured...the slogan 'MakeCargoGreatAgain' will have come true." He clarified that this slogan focuses on the overall cargo market rather than just PKP CARGO, emphasizing the importance of healthy competition to boost rail freight traffic. "This will benefit all of us and, above all, ecology," he added.

The discussion focused on the necessity of systemic solutions from the state to facilitate the growth of intermodal transport, including support for new technologies. Dr. Wojewódka questioned the government’s commitment to transferring freight from trucks to rails, or if it would continue to invest in new motorways instead. He referenced successful solutions from countries like Switzerland, where rail container transport is well developed.

In Poland, the high costs associated with accessing rail infrastructure were cited as a significant barrier to competition with road transport, where access is often free. Dr. Wojewódka called for railways to be modernized and simplified to overcome these challenges.

Overall, the workshop featured various presentations and discussions, along with opportunities for participants to engage in individual consultations with specialists from the CUPT and MFiPR, facilitating further exploration of the issues at hand.

Crisis Facing PKP CARGO

Despite the positive outlook for intermodal transport, PKP CARGO is struggling with serious financial problems. A new management team, including Dr. Wojewódka, Monika Starecka, and Paweł Miłek, was appointed in April to address these issues caused by years of politically driven decisions that have placed the company in a precarious position, leading to the need for a sanitation process that includes laying off thousands of employees to stabilize operations.

As we previously reported, due to its financial difficulties, PKP CARGO is currently unable to provide immediate severance payments and benefits to laid-off employees. To manage these payments, the company plans to apply for a loan from the Guaranteed Employee Benefit Fund, with a commitment to fulfill all obligations as soon as possible.

The company's debt has soared to over EUR 1.2 billion, with approximately EUR 460 million allocated for salaries in 2023 alone. The previous board made questionable decisions, such as approving salary raises while making overly optimistic revenue forecasts for 2024, further complicating the financial landscape. Dr. Wojewódka openly criticized past management practices, stating, "The previous few years at PKP CARGO have been an example of disastrous management, bad decisions, and the use of the company to build political and trade union influence."

Source: PKP CARGO; Rynek Kolejowy; RAILTARGET