Government Shunts Plans for Germany’s Railway System

In Germany’s frustrated effort to build a better railroad, the formula for reform is “push and pull”: push commuters to take the train by raising gas taxes, and pull in vacationers with sleek, high-speed trains and futuristic new stations.

However, after a year marred by the country’s worst-ever train wreck, slumping ridership and erosion of the proud German tradition of punctuality, Europe’s busiest railway appears destined to be driven by fewer carrots and more sticks.

Shortly after taking office in October, the new government of Social Democrats and environmentalist Greens turned off the money tap for the Transrapid, the magnetic-levitation train that was envisioned to cut travel time on the 180-mile Berlin-Hamburg run by half, to less than an hour. Now, the denationalized Deutsche Bahn’s showcase project to move major-city terminals underground also is in doubt.

“We need to ask ourselves what we can get for our limited investment funds, and many now believe this money would be better spent on new tracks and technology than on image-boosting projects,” says Albert Schmidt, a newly appointed member of the railway’s supervisory board and the transport policy chairman for the Greens.

The plan to move tracks and terminals underground and enable prime real estate in the center of Germany’s biggest cities to be sold to private developers was the brainchild of Heinz Duerr, board chairman for Deutsche Bahn until his unexpected and unceremonious ouster in late February.

Heads had to roll after the disclosure last month that the federally financed but privately managed railway suffered one of its worst years in 1998 since wartime in terms of accidents, breakdowns and delays, and saw its number of passengers drop for the first time since the 1994 start of privatization. On June 4, 101 passengers were killed when a high-speed train derailed in the northern town of Eschede.

Britain’s rail service has suffered similar setbacks since it was denationalized in 1996 and private service providers began slimming down the work force.

Deutsche Bahn has shed 25% of its original 336,000 employees, and some fear the slipping safety and on-time records are the result.

Deutsche Bahn Director Johannes Ludewig has sought to repair the railway’s damaged public image with reminders that injury accidents are nine times more frequent per mile traveled by car.

Germany’s trains and tracks are 25 years old on average, and much of the eastern network inherited from the former Communist system was Soviet-built and dates from the 1940s.

The railway’s new leftist masters say priority needs to be given to installing more modern and environmentally efficient locomotives and switching systems on the regional networks, instead of to expensive new stations and sleek carriages for long-range Inter-City trains, which account for only 10% of income and traffic.

Even transport strategists from the other side of the parliamentary aisle tend to agree that the railway’s investment plans could use some rethinking.

Horst Friedrich, transportation policy chief for the opposition Free Democratic Party, says that underground stations are a good idea but that the real estate market is too weak to guarantee sufficient co-financing from land sales in any city but Frankfurt.

With the underground terminals’ projected cost of $3 billion apiece, the railway’s government financiers insist that at least 60% of construction costs must be covered by the private sector, because the financiers’ annual budget for railway investment is less than $7 billion for all of Germany.

The goal for the federal bankrollers must be to convert more car drivers into train riders and move more truck cargo onto the rails, says Winfried Hermann, a Greens legislator from Stuttgart.

“The problem now is that gasoline is too cheap,” says the legislator, whose party advocates a tripling of gas prices over the next decade, to about $12 a gallon.

Janet Stobart of The Times’ London Bureau contributed to this report.