Germany's DB Cargo plans 6,000 job cuts in bid to return to profit

By Christian Kraemer

BERLIN, Feb 19 (Reuters) - German railway operator Deutsche Bahn's struggling freight business DB Cargo plans to cut 6,000 jobs, nearly half of the workforce, by 2030 as part of a restructuring aimed at returning to profit, the unit's chief said on Thursday.

Confirming a Reuters report, Bernhard Osburg said the unit would eliminate about 6,000 of DB Cargo's 14,000 workforce to try to cut costs that he said were too high.

"That's the gap between us and the competition," Osburg said, adding that business from the automotive, steel and chemicals sectors had fallen but there had not been job cuts to reflect that.

As far as possible, he said staff affected would be offered jobs in other parts of Deutsche Bahn, which employs around 220,000.

DB CARGO IS MARKET LEADER BUT HAS COMPETITION

About one million metric tons of goods are transported by rail every day in Germany. DB Cargo is the market leader, but its competitors are catching up with a combined market share of around 60%.

The company has also come under pressure from the European Commission's insistence governments curb excessive state support. DB Cargo is required to post a profit by the end of 2026, as its state-owned parent is no longer allowed to cover losses at the freight subsidiary.

Osburg said that would be a major challenge but that DB Cargo aimed to post a net profit in the double-digit millions for 2026. He said the unit generated an operating profit for the second half, after a 96-million-euro ($113 million) operating loss in the first six months.

He said the group was looking to build up its international business and was exploring opportunities with the automobile sector in southeastern Europe as well as with steel imports from China, particularly around major ports including Rotterdam.

Cosima Ingenschay, deputy leader of the EVG rail union, said both sides agreed that DB Cargo must become more efficient but disagreed on how to achieve that, adding tough talks loomed.

“We will fight for every job,” said Ingenschay.

As part of the restructuring plan, some smaller maintenance centres would be closed and the group plans a major overhaul of its single wagon transport service, particularly in the steel sector.

($1 = 0.8484 euros)