Schroeder backs embattled rail chief

23rd September 2004, Comments 0 comments

24 September 2004 , BERLIN - German Chancellor Gerhard Schroeder has given his full backing to the chief of the country's state-controlled railway after it scrapped plans for a stock market listing in 2006. Schroeder said he now expected plans to privatize Deutsche Bahn to go ahead by 2008 at the latest. There have been calls for Deutsche Bahn chief executive Hartmut Mehdorn to resign over his running of the railway. But Schroeder said Mehdorn, who took charge of the unprofitable company in late 1999 taske

24 September 2004

BERLIN - German Chancellor Gerhard Schroeder has given his full backing to the chief of the country's state-controlled railway after it scrapped plans for a stock market listing in 2006.

Schroeder said he now expected plans to privatize Deutsche Bahn to go ahead by 2008 at the latest.

There have been calls for Deutsche Bahn chief executive Hartmut Mehdorn to resign over his running of the railway.

But Schroeder said Mehdorn, who took charge of the unprofitable company in late 1999 tasked with getting it out of the red and fit for flotation, was "really on the right tracks".

Deutsche Bahn "will this year for the first time in decades make a considerable profit", he said. He now expected a share offering to take place "in a time corridor between 2006 and 2008".

Mehdorn has faced heavy criticism from politicians but also customers and company employees.

Calls for his resignation came Thursday from three parliamentary transport experts whom Mehdorn had complained about in a letter to the head of the country's industry federation.

One of the deputies, Albert Schmidt of the Greens, said parliament had lost confidence in Mehdorn.

Deutsche Bahn had said Wednesday its plan to hold an initial public offering of shares by summer 2006 "appears unrealistic".

In the first six months of this year, the company had a loss of EUR 62 million. Although down on its loss of EUR 143 million in the same period last year, the reduction is much slower than planned.

It also announced this week it would increase long-distance ticket prices by an average of 3.1 percent in December and local journeys by up to 3.9 percent, citing higher energy costs.

DPA

Subject: German news
 

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