On the basis of an improved financial situation, the Italian state railway Ferrovie dello Stato (FS) wants to attack Deutsche Bahn. CEO Stefano Donnarumma confirmed this at a presentation of a new four-year plan in Rome on Thursday. “We have strengthened ourselves over the past year and are now embarking on a solid growth path.” After last year there was a loss of 200 million euros, this year there was a small after-tax profit, which the company has not yet quantified. Foreign business should be a pillar of expansion – especially in Germany. FS is currently identifying routes within Germany on which the Frecciarossa high-speed train will be used in the future, and is examining the purchase of new trains of this type. However, entry into the German high-speed market is not expected before 2029, said Donnarumma. However, the FS boss was already advertising on his own behalf by making a few comments against Deutsche Bahn: “When you get on a train in Germany, you don’t know when you’ll arrive.”
Break-even point abroad will be 2027 at the earliest
FS operates with its subsidiary Trenitalia on the foreign markets of France, Great Britain, Spain and Greece. The group is also represented in Germany by the regional company Nitinera. However, the FS foreign business with its 12,000 employees and a sales contribution of three billion euros is recording significant losses. FS keeps to itself how much. Donnarumma admitted that the break-even point in foreign business could not be expected until 2027 at the earliest.
The overall situation of the group, which, like in Germany, also includes the rail network, is expected to gradually improve in the coming years. According to the new four-year plan, the after-tax profit should increase to 500 million euros by 2029. Sales of 16.5 billion euros last year will increase to 20 billion euros during this period if everything goes as planned.
Two dozen billion euros from the EU for Italy’s tracks
FS benefits significantly from EU funding on its home market: the state-owned company will receive 25 billion euros from the European reconstruction plan, which expires next June. No other country in the EU receives as much funding as Italy from the plan adopted during the pandemic. So far, Italy has received a good 150 billion euros, and a total of more than 194 billion euros is earmarked – around 37 percent of it as grants and the rest as discounted loans. “The vast majority of these funds go into infrastructure, it is not the case that we can use them to buy trains to enter the German market,” said Donnarumma when asked whether this was an unfair market advantage.
As agreed in May, FS and Deutsche Bahn actually want to cooperate on cross-border connections, especially between Milan and Munich and later also Berlin to Naples. “We are looking forward to the new direct connections Munich-Milan and Munich-Rome in the 2027 timetable in cooperation with Trenitalia and the Austrian Federal Railways,” said a DB spokeswoman on Thursday. However, it is difficult for the German company to imagine how this will be compatible with a competitive situation on long-distance routes within Germany in the future. FS boss Donnarumma, on the other hand, expressly believes that coexistence between cooperation and competition is possible.
Transport Minister Salvini was annoyed about delays
The FS subsidiary Trenitalia had significant problems with train cancellations and delays last year. The company reported that the proportion of trains running on time improved by three percentage points to 85 percent last year; The rate for high-speed trains also rose by three percentage points to 77 percent. But the consumer organization Altroconsumo speaks of a deterioration. The Minister of Transport, Matteo Salvini, who was present at the presentation, also gave the railway company the task of “annoying him less” in the coming year because he, too, often travels by train.
To justify this, the Italian state railways point to the 1,200 construction sites in the country that are used to renovate the track network. 18 billion euros were invested last year, twice as much as five years ago. And between 2026 and 2034, the railway company wants to invest a total of 177 billion euros. In contrast to Deutsche Bahn in Germany, FS and Trenitalia have a popular competitor on the Italian tracks: the private railway company Italo. It has taken significant market share from Trenitalia, especially on the routes between central and northern Italy. Italo also recently announced plans to expand into domestic German routes, but has not yet provided any details.
