320 - TCDD loco - JeffRailway Companies

Loss of TCDD – I

TCDD made a loss of TL 2.27 bn last year.

Ministry of Development targets to lessen the loss of TCDD to “sustainable” level in the following 3 years. According to this plan, the assignments for social projects and public benefits on TCDD will be minimized, and will be paid by government. The subsidiaries of TCDD; Tudemsas, Tulomsas and Tuvasas will be restructured based on market needs.

Let’s discuss how TCDD made this loss in detail.

Loss of TCDD was TL 271 mn in 1999, and increased every year by 15% in average and reached to TL 2.27 bn (€ 700 mn) in 2014*.

Loss of TCDD

The subsidies in income statement of TCDD is the amount paid by government for social projects and public benefits. Assignments dropped sharply in 2014, but also the subsidies. Thus, the loss did not increase, but did not decrease much either.

Loss vs Subsidies of TCDD

Restructiring of subsidiaries may slightly change this graph, since loss of them are very small compared with TCDD. Below is the profit/loss amounts of subsidiaries in 2014 (2013 for Tuvasas).

Profit/Loss of TCDD’s Subsidiaries in 2014 (mn TL)
Izban -29,7
Hyundai Eurotem 2,5
Voesalpine Kardemir -0,4
Sivas Travers 0
Tulomsaş 3,7
Tuvasas (2013) -21,4
Tudemsas 1,7

Then where did this big loss come from? Here’s the operating losses of TCDD in 2014 in service detail:

Profit/Loss of TCDD in 2014 (mn TL)
Income Expense P/L
Suburban (Marmaray and Ankara) 70 129 -59
Mainline Passenger 194 1.069 -875
Freight 642 2.188 -1.545
Ports 316 196 120
Van Lake 6 36 -31
Sum 1.228 3.617 -2.389

59% of the operating loss comes from freight and 33% is from mainline passenger services. The only unit with profit is ports, where contribution is decreasing everyday due to privatization (the privatization income is not included).

TCDD Expenses 2014

TCDD made operating loss of TL 2.5 bn (€ 800 mn)  from freight and mainline passenger services in total. 2014’s income is TL 907 mn where only fuel/energy cost is TL 610 mn. Income can almost just meet energy/ful + spare parts cost (around TL 100 mn).

Let’s look into expenses in detail:

Expenses of TCDD in 2014 (mn TL)
Traction (Except fuel/energy) 844,0
Fuel/energy 610,4
Rail network 557,2
Traffic 396,8
Regional offices 331,5
High speed 247,7
Non-operating expenses 204,5
Headoffice 138,9
Depots 128,3
Freight 123,1
Suburban 19,2
Restaurants/sleepers 0,4

This table says, it’s almost impossible to come to a balance only with reducing expenses.

* Subsidies are excluded from the profit/loss calculation. The loss drops to TL 1,87 bn when included.

Cover Photo: Jeff Hawken ©

Categories: Railway Companies

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