ROMANIA
the long road to integration









Eng. Valentin Bota, General Manager


National Passenger
Railway Transport Company

Interview with

Eng. Valentin Bota,
General Manager

April 11th, 2000

What have been the results and changes taking place in your company since it was first established?

This splitting of the former CFR has allowed a better knowledge of every sector of CFR regarding the incomes and the expenditures. Due to this division, for the first time in Romania the rail passenger sector is subsidized by the Government as it is all around the world. In one year and 3 months, until the 31st of December 1999, the Passenger Company succeeded to significantly reduce the expenses both by cutting down the personnel by 7,000 people (from 31,000 to 24,000) and by reducing the material expenses. This led CFR Passengers Romania to obtain profits for the first time last year. It was not very much but it was already something. I think that this profit demonstrates that the reorganization was the right one and we are on the right path.

Can you give us some more statistics about your company?

CFR Passengers operates daily 1,735 passenger trains, it has under its property 4,400 coaches, sleeping cars and restaurant cars. It counts almost 800 locomotives of different types and it carries every month approximately 12 million passengers.

What efforts are you making in order to keep up with the European standards?

After the reorganization we have also started a modernization program, both for the locomotives and the coaches. This modernization was done partially with our own resources and partially with credits from different banks. In 1999 we modernized 24 electric locomotives with Siemens Co. through a credit from the EBRD, and we produced two prototypes of modernized locomotives with General Motors from our own resources in Electroputere Craiova. We also produced four prototypes of hydraulic Diesel locomotives with Alstom Co. through Alstom Romania. The modernization program for locomotives will go on in the year 2000 through a credit for which we are in an advanced level of negotiations talks with the Japanese Bank JBIC.

With our own efforts we succeeded in 1999 to modernize 200 coaches in the Romanian repairing workshops (Grivita-Bucharest, Remar-Pascani and Astra-Arad). In December 1999 we signed a contract for the modernization of 100 coaches with Alstom in France, and these are going to be produced here in Romania with Romanian companies. These 100 coaches will meet international standards and they will be able to run at a speed of 200 km/h, with A/C and all the usual comfort.

In Western Europe there are two passenger areas which are developing very fast. Short distance for the people living in the outskirts of the cities and the high speed trains such as TGVs. What are your plans in this respect?

Our plans have been already accomplished. Starting with February 1st 2000, the Passengers Company I have talked about has been divided into nine independent companies. Eight of these companies are in charge with short distance traffic and they are divided geographically in the country. The remaining company is in charge with long distance trains and I am the general director of this one.

And what is your present role since the company has been divided?

I am responsible with the long distance passenger traffic.
When you talk about long distance are you referring only to trips inside Romania or are you also including trips abroad?

We also have trips outside the country. The Long Distance Company is operating daily 250 pairs of trains (we talk about pairs because they are running forward and back) out of which 70 are international trains. These are both the long distance trains Bucharest-Vienna or Bucharest-Istanbul and the international traffic at the borders. Out of the total passengers traffic we hold 42% of train/km and 57% of passengers/km. The rest is represented by the regional traffic.

What do you do to attract more customers?

Regarding internal traffic, air traffic does not represent a serious competition - there is a small number of flights inside the country and the number of passengers is quite pretty reduced. The main competitor for internal traffic is the land transportation, and here I include both personal motor cars (of which there are so many lately) and bus transport. Basically the railway has an advantage towards the road transportation: smaller tariffs. Also the safety of the railway transportation is much higher.

The number of passengers has decreased very much since 1989 but this decrease was due first of all to the economic decrease. In 1989 approximately 50% of the people using trains were people who were going from the villages to the cities to work. The economic fall and the reduced number of working places has made the number of this kind of passengers to represent now only 10%. The decrease is due first of all to economic causes and secondly to the competition. We hope the year 2000 to be a year of equilibrium from the passenger point of view and that the decrease will stop. The results of the first three months allow us to think that things are better.

What are your plans for the future? Do you have any international aspect in mind?

First, we want to continue the modernization program for coaches. We will do this from our internal resources, raising the qualitative level of our services. Of course, we have very good relationships with all the European countries. In the year 2000 we want to reach agreements regarding the long distances Romania-Hungary and Romania-Austria concerning a fast and through train, and we are working out an optimal solution. Besides the through trains we also have direct coaches as the ones between Bucharest and Paris, Bucharest and Munich and Bucharest to Prague. The utilization degree of these coaches is very high. We also have good tariff agreements. We have special agreements with Germany about round tickets from Romania to any city in Germany at a cost of only 100 EURO. Through these agreements we want to attract more passengers in international traffic and when the citizens of Romania are able to travel around Europe without visa, the traffic will be, of course increased.

Do you have a final message for our readers?

I consider that the Passengers Company and the Romanian Railway reorganization are in line with the European Community Directives regarding the organization of railways.

Ours is a railway that has found its financial balance and which is going to fight for the improvement of the technical characteristics of the rolling stock and for the development of the transport market.

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© World INvestment NEws, 2000.
This is the electronic edition of the special country report on Romania published in Forbes Global.
July 24th 2000 Issue.
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