Evelyn Palla, head of Deutsche Bahn, announced that the company will divest from any subsidiaries or investments that do not contribute to its core business, defined as rail passenger services. According to Palla, the focus must become sharply concentrated on train travel.
Non-core operations, such as services addressing the “first and last mile” of a journey, will only be pursued by Deutsche Bahn if they prove to be profitable. This necessary scrutiny means that existing services, such as the rental of bicycles (Call-a-bike) or cars (Flinkster), are now under review. While Palla did not specify which departments would become unprofitable, she made it clear that any segment currently reporting a loss must show a profit in the near future.
The DB group currently maintains a balance sheet listing over 500 investments, many located abroad. To date, the company has already taken significant steps toward streamlining its operations. In the past year, Deutsche Bahn sold its highly profitable logistics division, DB Schenker, which primarily handles freight transportation by truck. Furthermore, the state-owned concern successfully separated from Arriva, the international passenger transport company that managed bus or regional services in countries like Great Britain, Italy, and the Netherlands. These divestitures were driven not only by strategic considerations but also by the resulting proceeds, which allowed the group to reduce its high debt load.
In terms of future plans, it has been decided that Deutsche Bahn will detach itself from large international rail projects, including those in India and Uruguay. These projects are currently managed by the subsidiary DB E.C.O. Group, but Palla stated that this is effectively a business area the company intends to withdraw from in the medium term.
