What is the destination of the Bulgarian train?

 

In mid-October, our railways became the focus of social tensions, intensive media attention and biting comments from both former and current managers. What facts did we learn about their actual financial situation from the press-conference of Minister Alexander Tsvetkov and Deputy Minister Kamen Kichev, held on 14th October in the MTITC?

The situation in BDZ and NRIC is exceptionally grave – the Minister used the word “bankruptcy”. A detailed analysis, conducted over the course of two months, came to the conclusion that both companies have been reduced to this situation as a result of uncontrolled spending and lack of professional management during a number of years. Furthermore, Minister Tsvetkov considers that the subsidy for the current year has been intentionally spent in an unbalanced way: in BDZ - BGN25 million in January, while for the months November and December – only BGN9 million. In NRIC – BGN12 million for the first quarter of the year, while for the last quarter – only BGN4 million. According to the new management team in the Ministry, the inappropriate distribution of state funding has brought about the current situation where it is impossible to pay on time the salaries of railway personnel. As an urgent measure to cope with the situation, the Council of Ministers decided earlier on the same day to transfer BGN6.9 million from the capital programme of NRIC into a subsidy, which will be allocated for the disbursement of August, and part of September, salaries of the employees. The financial situation of the companies can be expressed with the following figures: BDZ has outstanding liabilities to contractors of over BGN150 million, pending payments to creditors by the end of the year of BGN37 million and in 2010 - BGN101 million. By the end of this year, the outstanding liabilities of NRIC to its contractors will reach about BGN100 million. At the same time, apart from the advance spending of the subsidy, the funding under the capital programme has also been 90% spent.

As a long-term measure to enhance financial results of BDZ, Minister Tsvetkov announced the intended restructuring of the company – this time in the reverse direction. By merging of the four companies (BDZ EAD and its three daughter-companies) it is expected that departments will be reduced from 59 to 25 and directors will be cut from 16 to 6. The Ministry considers that a 60% reduction of administrative personnel will result in savings of BGN1 million per year. A new marketing structure will be established in order to enhance the market orientation and competitiveness of the national railway carrier. Tightening of financial discipline can be seen in the fact that by the end of the year, payment of all expenditures will have been terminated with the exception of expenditures for salaries and immediate operational costs for BDZ and NRIC activities. It is envisaged that all contracts concluded by both companies will be revised and re-negotiated if possible. Negotiations with creditors will be held with a view to the deferment of due payments. In parallel, a complete internal audit will be made in both companies by an international auditor.

According to Minister Tsvetkov, the streamlining of the administrative structure, reduction of costs and the establishment of a specialised marketing division could stabilize BDZ and transform it into a modern, flexible, market-oriented company. With the same objective in view, he announced the intention to involve a prestigious company from abroad to elaborate a strategy for the development of railways. Minister Tsvetkov expressed his firm engagement with the balanced distribution of the subsidy in 2010 which will make it possible to pay salaries in BDZ and NRIC on time.

A day before the pres-conference at the MTITC (i.e. on 13th October), at a media briefing the new Executive Director of BDZ EAD, Pencho Popov, presented the main priorities in his work and answered questions from journalists. Popov pointed out that the tightening of financial discipline is one of the foremost measures to be implemented. This includes limitation of expenses as well as reduction of 12-13% of personnel, mostly administrative staff. Popov added that the optimisation of personnel will be based on careful selection in order to ensure that qualified and trained employees and workers will keep their jobs.

The attraction of additional cargo through market-oriented actions will be among the main factors for the stabilisation of the financial situation of the company and the enhancement of competitiveness of the national railway carrier. In parallel with the proactive commercial policy in the sphere of freight transport, Popov pointed out the necessity of a flexible offer for passenger services as well.

The Executive Director of BDZ EAD added that the main priority of the railway carrier is the provision of safe, comfortable and reliable services to its customers. Popov explicitly stated that strict penalties will be imposed in the cases of failure to perform professional duties.

 

 

Pencho Popov, the new Executive Director of BDZ EAD

 

On 8th October, the management of BDZ EAD was undertaken by Pencho Popov, who replaced the former Executive Director Hristo Monov. As main priorities in his work Popov defined the implementation of strict measures for financial control with a view to overcoming the difficult financial situation of the company; reduction of administrative staff and elimination of duplicate positions, as well as the conduction of a proactive commercial policy aiming at the restoration of customer trust in the railway carrier.

The Executive Director of BDZ EAD, Pencho Popov, was born in1969 in Polski Trambesh. He is married and has two children. Popov speaks English and Russian.

His whole professional career has been in the sphere of railway freight services. In 1993, he majored in “Railway transport technology and organisation” in the Todor Kableshkov Transport High School and in the same high school he specialised in computer systems for railway transport management.

Immediately after graduation, Pencho Popov started work in the system of the Bulgarian railways as a traffic manager. In the period between 1996 and 2005 he worked first as an expert and later as Head of Sector in the Freight Service Marketing and Tariff Department in the Head Office of BDZ EAD.

In 2005, Popov was appointed Director of the Freight Service Division of BDZ EAD. In the period between November 2007 and October 2009 he was Director of the daughter-company for cargo transport “BDZ – Freight Services” Ltd.

 

 

The rail industry relies upon delivery orders from the State

Eng. Emil IONCHEV

Executive Director of Wagon Works 99 AD, Septemvri

 

It is common knowledge that Septemvri-based Wagon Works 99 AD received a gold medal at the International Technical Fair in Plovdiv held in September 2009. The award was given for the wheelset, made by the company, equipped with two brake discs for passenger coaches for speeds of up to 160 km/h. Such wheelsets have been produced by Wagon Works 99 AD for several years and are exported to Serbia and Greece.

At the Plovdiv Fair, the company presented to its current and future customers a number of products, such as spare parts for brake systems, couplings and other spare parts for railway rolling stock. Only 10 years ago, BDZ imported 200 pieces of such wheelsets from Bonatrans (Czech Republic). In 1994-1995 BDZ imported them from another major producer Lucchini (Italy); in 1982-1985 – from Rafil (Germany), Valdunes (France), etc.

The medal received by Wagon Works 99 AD is an expression of the recognition for the high quality and competitiveness of our production. Nowadays we compete successfully with the above-mentioned well-established wheelset producers and BDZ EAD no longer needs to import such wheelsets from abroad.

Wagon Works 99 AD is the largest producer of wheelsets for both passenger coaches and freight wagons on the Balkan Peninsula. The production capacity is 30 000-40 000 pieces per year. In 2008, we produced and exported 18 000 wheelsets for various countries.

Since 2007, our company has been a holder of an European certificate for wheelset quality TSI. Currently, we are in the process of being certified by DB as well.

We have twice taken part in Innotrans Berlin where we presented our Class BA-004 wheelsets for freight wagons for an axle loading of 22.5 t/axle. We export wheelsets to prestigious companies in Germany, France, Switzerland, Portugal and the Balkan countries.

Wagon Works 99 AD is one of the most significant companies in our national railway industry. The company overhauls of passenger coaches and freight wagons, wheelsets and all types of railway vehicles from the rolling stock fleet of BDZ EAD, NRIC as well as of many other coach/wagon owners from our country and abroad.

In recent years, we have begun the production of several types of new freight wagons as well as of wagon wheelsets for a number of customers abroad. The latest stage in our development allows us to start building new passenger coaches as well.

 

 

In Brief

 

Railways are the most energy-saving transport

In an interview for the Focus information agency, the Executive Director of the Energy Efficiency Agency, Tasko Ermenkov, pointed out that railway transport is the most energy-saving transport mode. He stated that 90% of the energy import (fuels mainly) in our country is used mostly by road transport. According to Ermenkov, “the more road transport there is in our country, the more dependent is Bulgaria in energy terms and the worse becomes our commercial deficit, which amounts to EUR6 billion solely from fuel imports”.

 

Popovo to become an “Express” stop again

According to the Administration of Targovishte Region, the local authorities have reached agreement with the management of BDZ EAD to enable the express trains between Sofia and Varna to stop at Popovo Station again after the new train timetable enters into force on 13th December 2009. It is common knowledge that in 2008 this express train no longer stopped in Popovo.

 

Milcho Lambrev takes on the management of NRIC

On 20th October, the former Director General of the State enterprise NRIC, Anton Ginev, was replaced by Milcho Lambrev. The professional career of the new Director General of the infrastructure company has been in the systems of both BDZ and NRIC. He graduated from the Todor Kableshkov Transport High School, majoring in “Transport Construction and Economic Management of a Transport Company”. Lambrev speaks Russian.

 

Advisory council on railway transport in MTITC

The Ministry of Transport, Information Technologies and Communications has established an Advisory Council on railway transport to support the activities of the Minister. Members of the council are independent leading experts from the fields of business, state administration and science, who will work free of charge and will elaborate independent analyses, positions and proposals concerning the major issues in railway transport. The council members will take part in the elaboration of the Programme for development of railway transport and railway infrastructure. Among the council members is the Editor-in-Chief of “Railway transport” magazine.

 

Computer ticketing technology

BDZ EAD has introduced on-board computer ticketing on trains. Train tickets will be issued by mobile computers with an inbuilt printer for the tickets. 15 such mobile computer configurations will gradually be put in operation. 77 train staff members have been trained to use the new facilities. The first phase of the implementation of the new computer technology covers three of the most heavily-used suburban trains between Mezdra and Sofia.

The new ticketing technology will facilitate the railway customers and will help prevent people from travelling without a ticket. The transfer of data from the mobile computers on to a central server allows strict control over ticket sales in the trains.

 

Plovdiv terminal project begun

According to the Governor of Transgeo (which together with the Italian company, Net Engineering, placed the winning bid for the project known as “Technical assistance for the construction of an intermodal terminal in the Southern central planning region of Bulgaria – Plovdiv), Iliya Iliev, the preparation for the Plovdiv terminal project has already started. This is the first stage of the overall project for this infrastructure facility. The completion deadline is September 2010 and the project costs amount to BGN2 million (before VAT). Funding is provided by the EC under TEN-T.

 

Varna-Kavkaz ferry line working well

On 23rd September, the ferryboat Avangard arrived for the fifth time running at Varna port. Avangard operates along the ferry line to the Russian port of Kavkaz. The ferryboat came loaded with 34 railway tank wagons with machine oils and natural gas from Russia. On its return journey the ferryboat was loaded with 40 wagons. It is expected that in the near future further shipments will come from and to other CIS countries. The scope of goods is also expected to broaden. The new ferry line facilitates commercial exchange between Bulgaria, Russia and Central Asian countries and will contribute to the modal shift of additional cargo to the railways.

 

Seminar on transport education in RCIC

On 23rd September, a seminar for the exchange of experience between Bulgaria and Russia in the sphere of transport education was held in the Russian Cultural and Information Center in Sofia. The seminar was attended by 19 lecturers and directors of secondary and high schools from various parts of Russia. On the Bulgarian side, the seminar was attended by representatives of EARA, Technical University of Sofia, the Todor Kableshkov High Transport School, NRIC, etc.

 

Changes in BDZ management

By order of the Minister of Transport, Information Technologies and Communications, Maria Kaleva from the law directorate in the Ministry and Vladimir Vladimirov, CFO of Foodyard Holding, were appointed as members of the Board of Directors of BDZ EAD. In his turn, the new Executive Director of BDZ EAD, Pencho Popov, appointed, as Director of BDZ – Freight, Georgi Drumev, who had hitherto been Director of Transport Organisation and Technical Procurement.

 

Additional transit cargoes must be attracted

According to the Deputy Minister of Transport, Kamen Kichev, if additional transit cargoes are attracted for transport via Bulgarian territory, this would be one means of stopping the tendency for the decrease in freight railway services and for an improvement of the situation in BDZ. Another option is the accelerated construction of freight terminals, as well as the introduction of Ro-La trains.

 

Kamen Kichev takes part in the first ASEM meeting

On 19th-20th October, the Deputy Minister of Transport, Information Technologies and Communications, Kamen Kichev, participated in the first Asia-Europe meeting (ASEM) of transport ministers. The event took place in Vilnius and was a forum for the presentation of initiatives for trade and investment development, balance and stability in the trans-continental transport framework, as well as cooperation between the countries on both continents. The aim of the meeting was to foster a more active dialogue between Europe and Asia, identification of common perspectives and a discussion of a common vision on the Euro-Asian transport scheme and logistics. The meeting was attended by the EU Commissioner for Transport, Antonio Tajani, and the transport ministers of Lithuania, China, Germany, Sweden, Poland, Singapore and Vietnam.

 

Valeri Vasilev is the new Director General of TCR

Minister Alexander Tsvetkov has appointed Valeri Vasilev as Director General of the State Enterprise “Transport Construction and Reconstruction” and as a member of the Management board. Since 2006, Vasilev was Deputy Director General of TCR. Before that, he was Chief Engineer of Topinzhenering Ltd. in Pleven and in the period 1990-2004 he held various positions in NRIC and BDZ. Vasilev graduated from the Todor Kableshkov Transport High School. The other new members of the Management Board of the company are Kamelia Dimitrova and Biser Borisov.

 

Doubling of Bulmarket freight carryings

The Head of Logistics Department of the private railway operator Bulmarket, Dimitar Baev, announced that in the first six months of 2009 the company transported twice as much as during the same period in 2008. Currently, Bulmarket operates with 12 locomotives and 400 wagons and it plans to procure more rolling stock in order to increase its share on the national railway market (for the time being, the company is in third place after BDZ – Cargo and BRC). The company expects the delivery of five more recycled Class 86 locomotives from Denmark and 40 flat wagons. In a longer term perspective, Bulmarket plans the construction of its own depot for locomotive maintenance. According to Baev, there have been no developments concerning the concept for the establishment of a urban railway in Ruse, which the company proposed some time ago.

 

Minister Tsvetkov takes part in the Xth Turkish transport forum

Minister Alexander Tsvetkov has taken part in a summit of transport ministers from Europe and Asia, held on 28th September at the X-th transport forum of Turkey. The forum’s main focus was the vision of the countries from both continents on the future of transport policies. In his presentation, Minister Tsvetkov outlined the vision and main objectives of the Bulgarian strategy for the development of the transport sector and he acquainted his colleagues with the major projects under the Operational Programme for Transport. Minister Tsvetkov held a bilateral meeting with his Turkish counterpart Binali Yildirim, at which they discussed some open questions and unresolved issues concerning the transport links between Bulgaria and Turkey. The two Ministers agreed upon the convening in the nearest possible future of a joint transport commission and expressed their willingness for the development of ferry links, as well as railway and infrastructure links.

 

Progress in talks on Danube Bridge 2

On 30th September, the MTITC hosted the second meeting of the Joint Bulgarian-Romanian Sub-committee for the monitoring of the Danube Bridge 2 Project. The meeting was opened by the Deputy Minister Ivaylo Moskovski in the presence of HE Ambassador of Romania, Anton Pacuretu. The Romanian delegation was headed by the State Secretary in the transport ministry, Euzebiu Pistru. On behalf of Bulgaria, the meeting was attended by the Head of the unit for construction and management of the Danube Bridge 2, Simeon Evtimov. Representatives of the Regional Development DG of the EC also participated in the meeting. All the attendants noted the improved coordination between the two countries. Test results for the Romanian shore have been approved, as well as the final lengths of foundation pillars of the bridge.

The two countries have coordinated the technological solutions for the construction of the bridge supports as well as for the beginning of construction works in the navigable part of the river and on the infrastructure on the Romanian shore. The bridge is expected to be completed in 2011.

 

Online train information

As of 23rd September, the customers of BDX EAD can check online information about the arrivals and departures of trains from Sofia Central Station. The access to the new information service is through the railway operator website (www.bdz.bg). The introduction of the new service, which took place with the support of the Railway Administration Executive Agency (EARA), provides the customers with information about the arrival and departure times of the trains as well as the particular platform of each train movement. BDZ customers can check online train delays as well. Such information will be provided for other large railway stations as well.

 

Railway transport volumes drop

In August, cargo volumes transported by rail were 9.65 million tons, which is 4.9% less than in July and 42.4% less than the same month in 2008. Traffic (in ton/km) has dropped by 6.5% in comparison with the previous month and has reached 226.2 ton/km, which is 45.4% less than in August 2008. The number of passengers transported is 26.139 million, i.e. 1.6% less than in July and 7.1% less than in August 2008 (in passenger/km the decrease is 9.7%).

 

Appeal to the banks for railway employee credits

The Minister of Transport, Information Technologies and Communications, Alexander Tsvetkov, as well as the transport and railway trade unions appealed to the Association of Banks in Bulgaria to show understanding for the difficult situation of railway workers and to discuss possible deferment of due credit disbursements.

 

BDZ cares for blind passengers

On the occasion of the International White Cane Day, the national railway carrier expressed its support for all initiatives which aim at the provision of comfortable and equal access to public transport of visually-impaired people. As a result of the good cooperation between BDZ and Four Paws Foundation, the specially-trained guide dogs of blind passengers have access to all trains, including sleeping and couchette cars.

 

Express Serviz and Wagon Works–99 gold medals at Plovdiv Fair

Once again this year, the International Technical Fair in Plovdiv was the forum for the presentation of awards for significant achievements in the business sphere.

The Bulgarian companies in the railway sector received recognition for their efforts, not only to survive in the times of a global financial and economic crisis, but to evolve and gain positions on the international market.

The long years of innovative work of Ruse-based company Express Serviz, the builder of Class MDD 3-04 diesel shunting locomotive, were awarded with a gold medal and an honorary diploma at the Fair. The shunting locomotive is designed for operation at railway stations and industrial branch lines.

A Gold medal was also awarded to Septemvri-based Wagon Works 99 for their wheelset with two brake disks for passenger coaches for speeds of up to 160 km/h. This product, which until ten years ago was imported into our country from abroad, is delivered today both to Bulgarian companies as well as being exported to Serbia and Greece.