Deutsche Bahn takes over local transport in Toronto

The manager explains that the frequency provided by the existing network is not yet being exhausted: “It is therefore a matter of using the network’s capacity to the full and expanding it further. For this, the Canadians will invest in infrastructure and new trains.”

The project should fuel the debate about the cost-benefit calculation for the state-owned company’s foreign business. A few months ago, the Federal Court of Auditors criticized the fact that the commitments did not make a stabilizing contribution to the group’s finances. On the contrary, the risks for the group and thus also for the owner, the federal government, would increase as a result of the foreign activities.

Representatives of the FDP and Greens also want the group to focus more on its German core business. The criticism sparked, among other things, at the British subsidiary Arriva. It has been in the red for a long time, and attempts to sell Arriva have so far failed. In 2021, however, the operating loss of the investment fell from 431 to 73 million euros.

Mixed success of Deutsche Bahn abroad

In contrast, the internationally active logistics subsidiary Schenker shines. Last year it was able to increase its operating result from EUR 711 million to EUR 1.25 billion. The group has more than 400 holdings, many of them abroad. In total, Deutsche Bahn turned over 23.2 billion euros beyond the German borders in 2021. That was 49 percent of group sales.

Bahn manager Warbanoff counters the criticism of international business and refers to the current mega deal in Canada: “Deutsche Bahn is not investing any of its own money in Toronto. We are also not dependent on ticket sales or the occupancy of the trains.” DB IO has the contract for planning, operation and maintenance and is paid for it by Metrolinx. Ronald Pofalla, the Group’s outgoing Chief Infrastructure Officer, goes even further: “The enormous technology and knowledge transfer and the experience that we are gaining in Canada are of direct benefit to the railways in Germany.”

>>Read about this: Losses, restructuring, permanent construction site network: How things will continue at Deutsche Bahn

A statement that raises questions. The state-owned company can reinvest the money it earns in Canada in Germany. But how the modernization of rail transport in Toronto will help to make trains in Germany run more reliably and more punctually cannot be seen at first. Bahn Manager Warbanoff tries to explain and refers to the automated S-Bahn line that started operating in Hamburg a few months ago.

Colleagues from DB ECO who had previously gained experience abroad were involved in the project. “That shows how important such commitments abroad are for the core business in Germany.” In Toronto, the experts could gain experience in the modernization of rail transport under optimal conditions. “The renewal of the node in Toronto during ongoing operations will bring us valuable insights that will help us in all German metropolitan areas.”

The railway management does not have to fear criticism from the federal government because of the new order. “The risk for the group is very low. On the contrary, Deutsche Bahn in Germany benefits from the technology transfer from Canada,” said Warbanoff: “It has a model character, which is why the federal government gave us the green light for the project.”

The special tendering procedure could also have a model character. Instead of outsourcing the expansion of the rail network, the operation and the purchase of new trains separately, an integrative and collaborative approach was chosen in Toronto, which cannot be compared to other processes, according to Warbanoff.

DB IO applied together with three partners. The Aecon Group from Canada, together with the FCC Group from Spain, is responsible for expanding the infrastructure, while Alstom from France is supplying signaling technology and trains. DB takes over the operation and maintenance of the network.

“New and forward-looking for me too: even the CEOs of the companies had to face an assessment, i.e. a kind of job interview,” says Warbanoff. He could also imagine something like this in Germany when modernizing tendering procedures.

Streets in Toronto are congested

The Toronto administration wants to completely reorganize local transport. The metropolis is growing very fast. Around three million people currently live directly in Canada’s largest city, and another six million people in the surrounding area on the border with the USA. Forecasts predict that this number will double in the next 20 years.

At the same time, local rail transport has not kept pace with this development. As with all of North America, the car was heavily bet on. It is true that rail services have been expanded during typical commuter times. However, there is no regular scheduled service in Toronto, such as is standard in German cities. The network is now to be expanded from 450 kilometers to up to 700 kilometers.

Because the roads are now completely overloaded. The existing infrastructure does not allow for the construction of even more or wider roads. So the focus is more on rails. Especially since municipal politics has started to make traffic more sustainable. 300 electric buses were ordered last year. They complement the 60 electric buses that are already in operation.

More: The most important route in the republic will be closed – transporters warn of Easter chaos on the rails