Chairman’s letter

Dear readers,

The UEFA European Football Championship acted as a magnifying glass, raising public awareness of the high demand for environmentally friendly mobility and, at the same time, the need for action in track infrastructure. This is why it is all the more important that we have started the general modernization of the Riedbahn, the line between Frankfurt am Main and Mannheim, which represents the first major project to sustainably improve quality and stability. Many more projects such as this will – and must – follow over the next few years.

Overall, the first half of 2024 showed that demand is intact. After some difficult months, both operationally and economically, we were once again able to record a significant increase in revenues in long-distance transport in June. DB Regional also recorded positive effects in revenues.

However, the track infrastructure is outdated and prone to failure. When extreme weather events also come into play, which occurred more frequently than ever in the first half of 2024, this has a huge impact on rail traffic. In June 2024 alone, on average more than 400 long-distance trains per day were affected by infrastructure damage caused by external factors such as landslides, floods and dam damage.

Several strikes by the German Train Drivers’ Union (GDL) in the first quarter of 2024 also had a significant economic effect on us. In addition to the difficult operating situation, these strikes had a negative impact on the booking behavior of our passengers and on demand in freight transport, where the companies concerned depend on reliable, environmentally friendly logistics.

We are therefore resolute in our efforts to achieve short-term improvements: a punctuality action plan to stabilize the operating situation and a strict spending monitoring and control program to safeguard our profit targets in 2024. Our target is set: we want to improve our profit in the Integrated Rail System by about two billion euros compared to the previous year.

It is also clear that we can only achieve sustainable improvement in all areas if we completely renovate and modernize the rail infrastructure. Our customers rightly expect better quality. A robust, efficient existing network is the prerequisite for a more reliable and thus more attractive railway.

We are grateful that the Federal Government shares this conviction. In 2024, we will receive about 60 percent more funding from the Federal Government for infrastructure than in previous years. A similar level can also be expected for 2025 and 2026. This will enable us to continue modernizing the infrastructure. Building on this, the stabilization of the operating situation as well as the economic recovery and efficient structure of all business units of DB Group remain high priorities for us.

This means that we will standardize, automate and digitize significantly more – also to deploy employees more efficiently and with the greatest benefit for our customers. This is the only way to increase our productivity. In times of a shortage of skilled labor, this is crucial for our readiness for the future.

Five years ago, we launched our Strong Rail strategy to achieve growth and a shift in the mode of transport. Since then, despite a series of global crises such as the Covid-19 pandemic and the war in Ukraine, we have made great progress: we have modernized our long-distance transport fleet and expanded our depots. We have hired at record levels. We have better linked modes of transport and massively expanded the schedule.

Now it is time to pull the central lever: by modernizing the infrastructure, we have the opportunity to bring our strategy to fruition and to progressively contribute to a modern, environmentally friendly society, which is what we have set out to do. A modernized and thoroughly overhauled existing network with high-performance corridors at the heart of it is the foundation for this. The start of the general modernization of the Riedbahn marks the beginning. Germany needs a strong rail system!

Sincerely

Dr. Richard Lutz
Chief Executive Officer and Chairman of the Management Board
of Deutsche Bahn AG