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The Warsaw Voice » Business » April 8, 2009
Business coping with the crisis
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Bring on the Competition
April 8, 2009   
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Krzysztof Celiński, chairman of PKP Intercity, talks to Marcin Mierzejewski.

What are the main tasks facing the company, which you been heading since January?
The most important task is to make PKP Intercity ready to function on the competitive market for railway passenger transportation. As per EU regulations, the market will be liberalized Jan. 1, 2010. Our company is taking up this challenge with a new structure, because since last year, alongside premium train services-express and Intercity trains-we have been in charge of po¶pieszne [fast] trains. A part of the latter are provided as a public service subsidized by the Ministry of Infrastructure. This a whole new situation for the company and a tremendous change whose magnitude is best illustrated by the fact that PKP Intercity's staff has grown from 2,300 to 8,400. We run 555 trains every day, while just two years ago, it was between 100 and 200.

Can passengers look forward to cheaper tickets as a result of the liberalization?
That is possible. Liberalization is about making services more accessible and cheaper, which, however, must not result in poorer safety standards. In terms of travel safety, trains are easily superior to car travel. We hope safety requirements will be strictly observed to eliminate companies whose readiness to provide passenger services causes any doubts.

PKP Intercity has long been planning to enter the stock exchange.
This is another way to improve the competitiveness of the company. Competition will intensify, not least because of the expanding network of roads. In order to be competitive, we have to move away from the heavily unionized state-run enterprise model.

Entering the stock exchange is a way to achieve that, and it also generates funds for the growth of PKP Intercity, enabling, for example, the purchase of new rolling stock.

The current economic downturn is making the stock exchange debut somewhat more difficult. Some enterprises are now worth less on the stock exchange than the real estate they own. Still, our privatization advisers have been working hard on a 10-year corporate development strategy and a marketing strategy to make sure we are ready to enter the stock exchange any time. Their work is additionally complicated by the fact that you cannot really compare the present performance of PKP Intercity to that before the enlargement of the company.

While I would really like the economic crisis to end in the latter half of this year, it seems highly unlikely and so when I think about a date for the stock exchange debut, next year comes to mind. Everything depends on the economic situation.

How is PKP Intercity preparing for increased passenger traffic during the Euro 2012 European soccer championships?
Projects related to the Euro 2012 preparations are a top priority for us. Even now we have quite a good network linking the host cities of Euro 2012. Most railway lines on those routes are in a decent condition and wherever the condition is not satisfactory, we have still plenty of time to make improvements.

We want to carry out some of the Euro 2012-related projects as part of the EU's Infrastructure and Environment program. To begin with, these funds will be spent on the modernization of the Warsaw-Gdańsk and Poznań-Wrocław routes. Together with our colleagues at Polskie Linie Kolejowe (Polish Railway Lines), we may be able to achieve train speeds of 200 kph on the Central Railway Line from Warsaw to Katowice and Cracow in time for the championships.

Since funds are limited, it is impossible to do everything. In order to adjust travel times to Euro 2012 requirements, in some places rail connections will have to be complemented by road transportation. One example is the Warsaw-Wrocław route, which lacks a fast, direct rail connection, while the journey via Poznań takes too long and even after modernization will take almost four hours.

What other projects is PKP Intercity planning as part the Infrastructure and Environment program? Is there anything particularly environmental about them?
As part of our most important plans, we will modernize 400 train cars we have taken over from PKP Przewozy Regionalne and we will buy 20 modern combined trains similar to those that currently travel to ŁódĽ. They can travel at over 160 kph, which is suitable for most railway lines we operate on, where the speed limit is 160 kph. I believe we will submit the relevant applications to the Ministry of Regional Development this May. As far as ecology is concerned, the Infrastructure and environment program essentially treats railways as an environmentally-friendly means of transportation.

Intercity has promised to make it easier to buy tickets. How?
Passengers can already buy tickets online. For now it is for trains on which you book your seat. Another new feature are ticket vending machines, the first of which will soon be in use at the Warszawa Centralna station in Warsaw. We hope this will at least shorten the lines at ticket booths. More machines will appear in the largest railway stations in other cities.

We also want to enable ticket sales via cell phone. The new system is in the test phase and we would like to launch it this year.

What's the future of railways in terms of competing with other means of transportation?
As far as travel between Polish cities is concerned, I can see less and less room for air travel. Yes, people in Poland will fly more, but those trips will be predominantly trips abroad. Freeways will make many regions in Poland more accessible and the simultaneous modernization of railroads will have a similar effect. As a result, travel habits will have to be rethought. Railways will be able to guarantee journeys from one main Polish city to another in around two hours and so I have no doubt train travel will retain its appeal. After all, when you want to take a freeway you first need to get on one, while traffic jams in cities are getting worse and that will continue to give trains an enormous advantage over cars.
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