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Business met with the newly appointed Chairman of the Management Board of JSC “Ukrainian railways”

24/ 04/ 2023
  On April 20, the Logistics Committee of the European Business Association held a meeting with the newly appointed Chairman of the Board of JSC Ukrzaliznytsia Yevhen Lyashchenko. During the meeting, the business had the opportunity to discuss with the top management of Ukrzaliznytsia urgent issues related to the ban on the import of Ukrainian agricultural products by a number of neighboring European countries, as well as the issue of immediate infrastructure reconstruction. In addition, the Chairman of the Board shared his plans and key tasks in the office, and also confirmed the unchanged strategic priorities, in particular, the allocation of verticals of Ukrzaliznytsia according to the sphere of activity and ensuring compliance of industry legislation with the EU regulations. The draft law On railway transport is currently being finalized and will soon be published for discussion with businesses and the public. At the same time, Mr. Lyashchenko noted that the current strategy and model of Ukrzaliznytsia reform need to be updated, taking into account the experience of UZ work during wartime and the tasks of post-war reconstruction and modernization of the country. The management of UZ plans to focus on three areas of reform - infrastructure, passenger, and cargo verticals. Within the implementation of the investment program, the restoration and modernization of infrastructure, the renewal of rolling stock, the development of cargo and multimodal transportation, and European integration are defined as strategic directions. In 2023, UZ plans to break even due to a set of measures aimed at both increasing revenues and reducing costs. In particular, revenue growth is expected due to: An increase in the volume of cargo transportation in comparison with 2022; Increase in income due to the conclusion of direct contracts with cargo owners; Introduction of new products (container and contrailer trains). Currently, three container trains are planned for Gdansk and Budapest, while the directions of Constanta, Istanbul are being developed; Development of intermodal terminals and hubs (out of the planned 20 terminals, this year 5 are planned to be developed, which will start generating revenue in the 4th quarter of 2023); Increase in revenues from transportation in new wagons 1435 (there are currently 40 such wagons, and the purchase of another 120 tankers and 80 intermodal platforms is planned); In passenger transportation (dynamic pricing, growth of additional revenues, increase in the number of trains, work with the state on compensation for beneficiaries). In order to reduce expenditures, the UZ will resort to cost reduction and demonopolization of procurement by switching to direct contracts, reducing the costs of fuel and energy resources and electricity, optimizing processes and increasing labor productivity, reducing non-core assets and costs for non-core assets and relevant personnel, reducing costs for inactive districts. We are grateful to Yevhen Lyashchenko and his team for dialogue with business and hope for regularity of such meetings in the future!

On April 20, the Logistics Committee of the European Business Association held a meeting with the newly appointed Chairman of the Board of JSC “Ukrzaliznytsia” Yevhen Lyashchenko. During the meeting, the business had the opportunity to discuss with the top management of Ukrzaliznytsia urgent issues related to the ban on the import of Ukrainian agricultural products by a number of neighboring European countries, as well as the issue of immediate infrastructure reconstruction. In addition, the Chairman of the Board shared his plans and key tasks in the office, and also confirmed the unchanged strategic priorities, in particular, the allocation of verticals of Ukrzaliznytsia according to the sphere of activity and ensuring compliance of industry legislation with the EU regulations.

The draft law “On railway transport” is currently being finalized and will soon be published for discussion with businesses and the public. At the same time, Mr. Lyashchenko noted that the current strategy and model of Ukrzaliznytsia reform need to be updated, taking into account the experience of UZ work during wartime and the tasks of post-war reconstruction and modernization of the country.

The management of UZ plans to focus on three areas of reform – infrastructure, passenger, and cargo verticals. Within the implementation of the investment program, the restoration and modernization of infrastructure, the renewal of rolling stock, the development of cargo and multimodal transportation, and European integration are defined as strategic directions.

In 2023, UZ plans to break even due to a set of measures aimed at both increasing revenues and reducing costs. In particular, revenue growth is expected due to:

  • An increase in the volume of cargo transportation in comparison with 2022;
  • Increase in income due to the conclusion of direct contracts with cargo owners;
  • Introduction of new products (container and contrailer trains). Currently, three container trains are planned for Gdansk and Budapest, while the directions of Constanta, Istanbul are being developed;
  • Development of intermodal terminals and hubs (out of the planned 20 terminals, this year 5 are planned to be developed, which will start generating revenue in the 4th quarter of 2023);
  • Increase in revenues from transportation in new wagons 1435 (there are currently 40 such wagons, and the purchase of another 120 tankers and 80 intermodal platforms is planned);
  • In passenger transportation (dynamic pricing, growth of additional revenues, increase in the number of trains, work with the state on compensation for beneficiaries).

In order to reduce expenditures, the UZ will resort to cost reduction and demonopolization of procurement by switching to direct contracts, reducing the costs of fuel and energy resources and electricity, optimizing processes and increasing labor productivity, reducing non-core assets and costs for non-core assets and relevant personnel, reducing costs for inactive districts.

We are grateful to Yevhen Lyashchenko and his team for dialogue with business and hope for regularity of such meetings in the future!

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