Poland’s rail passenger competition increases

Attracting passengers to railways is not just a trend, it is an important element which supports the environmental and economic objectives of each country. For Poland, this criterion reflects infrastructure modernisation investments, the renewal of rolling stock and the delivery of services and facilities to increase the number of passengers. After repeated drops in the number of passengers for 2012-2014, as of 2015, the Polish rail market has recorded growths in this segment as a result of completing infrastructure rehabilitation works, at least on main lines. Other positive results included reduced travel time and improved punctuality.

In the first three quarters of 2017, Poland’s rail network carried 227.5 million passengers with a transport performance of 15.5 billion passenger-km and an operational performance of 122 million train-km. Compared to the same period of the previous year, the number of passengers increased by 4%, traffic performance by around 7% and operational performance by around 1.4%. Railway passenger transport services were provided by 18 transport operators of which Przewozy Regionalne (PolRegio) had the biggest share of 26.4%, followed by Mazowieckie Railways with 20,44% and PKP Intercity and PKP SKM with around 14%.
According to the latest report of IRG-Rail (2017), two years ago, the share of new entrants in Poland for this segment, and non-incumbent railway undertakings covered 62% of the operational performance (train-km). In Poland, these operators are regional public companies. This majority share of new entrants is due to regional services being operated by regional companies including the authorities of the respective regions and to the fact that Przewozy Regionalne, an operator of the national company, also municipalised regional authorities in 2008 and ceased to have ownership relations with the national operator. Although two years ago, 51% of the shares were bought by the state, and the rest of 49% remained in the property of regional authorities, the company had the same structure with no connection to the national operator. The new entrants in the Polish market that have bigger shares in this segment are divided into 11 rail passenger transport operators. In the country, the operational performance of a new entrant has an average of 8.45 million train-km. In terms of public services obligations (PSO), in EU, Poland ranks second, after UK, among the biggest markets per new entrants which operate based on PSO contracts, recording 8.92 million train-km per new entrant. In the commercial activity segment, each new entrant operates an average 1 million train-km. New entrants are main regional operators and over 50% of the contracts are granted directly.
Regarding the structure of the rail passenger transport market, there is a series of types of services delivered by operators divided into several categories: international, provincial (with services in the same province), inter-provincial (with services that cross the border of a province), inter-provincial express trains (a service provided only by PKP Intercity which operates through other brands: Twoje Linie Kolejowe – on long distances, InterCity, as well as others) and there are also periodic services which complete the above-mentioned services, but are provided based on special demands, with individual routes and outside train schedules.

Rolling stock development

According to the latest report of UTK, Office of Rail Transport, in 2015, passenger rolling stock expanded by another 21 electric multiple-units (compared to previous year), their number reaching 1,342, while the number of EMUs cars increased by 4.6% from 4,214 to 4,408. Also, the number of cars, including those for the EMUs increased by 3%. The diesel fleet of passenger transport operators increased by 16%, the total number reaching 253 units, including 93 single-unit railbuses (with two units). In turn, the number of locomotives dropped from 510 vehicles to 484 vehicles, including the reduction of 31 electric locomotives (from 363 to 332) and the increase of diesel locomotives, from 145 to 152. At the end of 2015, rail passenger transport operators invested PLN 2.8 million (EUR 660 million) in the procurement of new rolling stock.
To develop the rolling stock fleet, Przewozy Regionalne (PolRegio), Polski Tabor Szynowy and rolling stock manufacturer Fabryka Pojazdów Szynowych H Cegielski signed a letter of intent for building and testing a new EMU prototype. A collaboration with the Rail Vehicles Institute “Tabor” will be set for the project. The train will be completed in 2019 and necessary investments amount to EUR 7 million.
At the end of 2016, several banks decided to grant a EUR 146 million loan to PolRegio to complete the modernisation of 36 electric multiple-units and the procurement of 13 multiple-units of which ten electric and three diesel units.
Operator Koleje Mazowieckie will also contribute to the development of the rolling stock fleet of Poland by purchasing 71 EMUs. The project also includes the modernisation and construction of depots. Total costs amount to EUR 463 million of which EIB could grant EUR 116 million. With this procurement, the operator will replace a significant share of its own rolling stock fleet of 243 vehicles. Under the project, 150 vehicles will be new or upgraded, while 93 vehicles will be replaced or modernised.
Regional operator SKM Warszawa announced the tender for the procurement of 13 new EMUs, of which eight 5-car and five 4-car. The tender also includes an option for >
> eight additional trains to be delivered four years after the conclusion of the contract. The winner will also provide maintenance services for the 13 trains for a period of 15 years.
This year, Koleje Śląskie, operator in Silesia Region, launched the first Elf2 EMU built by Pesa. The contract is estimated at EUR 68 million and includes the delivery of 19 vehicles by 2018.
Starting with 2016, PKP Intercity announced its intention to allocate EUR 410 million for rolling stock. Plans include the modernisation of 400 cars and 60 locomotives, the procurement of over 50 cars, but also the rehabilitation of depots. This year, the operator signed two contracts worth EUR 138 million for the modernisation of 143 cars with an option for other 42 cars (mentioned in the contract). Also, Alstom began the rehabilitation of the first train of the 20 Pendolino vehicles which run a total of 1.2 million km.
EUR 43.5 million were allocated to the procurement of 19 EMUs for Małopolskie, Podkarpackie, Śląskie and Świętokrzyskie, total investments amounting to EUR 66.9 million. For the procurement of 20 intermediate double-deck coaches, 2 control coaches and 2 new electric push-pull locomotives, EC announced the allocation of EUR 41 million of the total necessary investment of EUR 51.3 million. The vehicles will run on the railways in Warsaw metropolitan area.

The first private long-distance operator

Railway operators in EU member states are allowed to deliver transport services in Poland, but have to meet various criteria such as licenses, free access decision and safety certificates. The Part A licenses and certificates in any other member state are valid and don’t require additional procedures, while the Part B safety certificate confirms meeting all necessary requirements to deliver services on a network and is valid in the issuing country. In April 2017, LEO Express received a Part B certificate for Poland. Another document necessary for providing international services includes the free access permit and, before its issue, the regulatory authority must evaluate the testing of the main objective and that of economic balance of a PSO.
In October, Office of Rail Transport (UTK) granted a license to operate passenger rail transport services on Krakow – Prague route to Czech private operator, LEO Express. In 2016, LEO Express sent a notification to the authority expressing their intention to operate on Prague-Warsaw-Prague route, but has formally withdrew the demand for open infrastructure access for this service. However, in June 2017, the operator signed notifications to UTK on the intention to deliver the international rail transport service between Prague and Krakow.
Thus, as of December 2017, Leo Express will be Poland’s first private operator to provide long-distance transport services launching regular services between the two cities.
“Competition on tracks boosts the chance that the passenger will obtain a better offer: price, comfort and quality of service. It is important that competition should be governed by the law provisions so as to improve the situation of the passengers. We do not want to face the worsening of service frequency in the longer term,” Ignacy Góra, President of the UTK said.
LEO Express will operate a pair of trains every day on Prague-Krakow-Prague route notifying three route alternatives. Each one includes stops, but two of them have three stops each, while one has four stops.
“It is news even on a European scale. Thanks to the efforts of the EU, there are operating several commercial carriers together with a state carrier on the markets of individual countries. It involves a lot of new challenges. We are glad that Polish authorities care about development of international connections and expanding the offer,” said Peter Jančovič, director at LEO Express Polska.
Under plans, the operator wishes to offer a network of cross-border connections in Central Europe through railway services and road services (bus). The company is already providing transport services in over 25 European cities.


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