What can Ukraine learn from the Swiss public transport system?

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Oct. 15, 2011, 4:47 p.m. | Op-ed — by Daryna Ariamnova
Editor’s Note: Daryna Ariamnova was born in Kharkiv, Ukraine, and lives in Switzerland now, after finishing a bachelor’s degree in business administration in Germany. She does not have a driver’s license and has always been a passenger of public transport companies in Ukraine, Germany and Switzerland. During writing her bachelor thesis in cooperation with the passenger transportation division of the Swiss federal railways, she had an opportunity to meet the employees of the company and to get to know the processes in the maintenance of trains in this division. In this article she analy\es her experience and thinks over the future of the public transportation system of Ukraine. When I first came to Switzerland, I was impressed by its public transport system. Almost each village and town has a railway station and the railway tracks are literally everywhere. Trains depart at least twice an hour during the daytime even from the smaller stations. Villages which do not have railway stations have bus stops from where yellow “PostAutos,” public buses operated by the Swiss post, depart (in most cases once an hour) and bring passengers to the nearest towns or cities. Swiss public transport system is an object of the national pride for Swiss people and is often referred to as “one of the most efficient public transport systems in the world.”

Ukrainian public transport system.

Ukraine inherited its transport system from the Soviet Union. The first routes of the Ukrainians railway track were built in 1861 (Lviv-Peremyshl) and 1865 (Odesa-Balta). Today, the length of the Ukrainian railway track is 22,300 kilometers, 44.3 percent of which is electrified.

The authority which coordinates the railway traffic is the State Administration of Railroad Transportation of Ukraine (Ukrzaliznytsa, further UZ). The director of the UZ is subordinated to the minister of infrastructure of Ukraine. The company employs around 375,000 people in all the regions of Ukraine. UZ is organized according to the geographical principle and has six regional departments: Donets’k railway, Southern Railwy, Odessa Railway, Lviv railway, Near-Dnipro Railway and South-western railway. UZ is not merely a service enterprise. There are several producing plants in its structure (for example concrete-producing plant for the building railway tracks or a factory producing spare parts, liquids and other materials needed for the maintenance of the rolling stock).

Passenger inter-city trains in Ukraine are quite slow (120-140 km/hour) and run mostly at night. Most inter-city trains depart late in the evening and arrive to their destination early in the morning. Some Ukrainians like such time-table, but I think that for the most passengers night trains are suboptimal. It is quite embarrassing to sleep in one department with the people one does not know and the quality of sleeping in such trains is miserable. For the business travelers it is probably be very problematic to arrive to an important meeting early in the morning without having had a good sleep. Some trains are not very good conditioned in the summer and badly heated in winter, which can turn a trip to a real impertinence.

There are four classes of wagons in a Ukrainian night train: 1st class, in which two people sleep in the department, second class with four people sleeping in the department, an open-space third-class wagons with sleeping benches everywhere in the wagon and fourth class (not worth mentioning).

The fastest route in Ukraine is the daylight train Kharkiv- Kyiv (480 kilomters). The trip takes six Hours and 26 minutes. A one-way ticket in the second class on this route costs 119 Hr or 5.3 percent of the official average salary in Ukraine.

Ukrainian railway carried 494 million passengers and laid back about 50 bln passenger-kilometers in 2010. An average Ukrainian lays back much less kilometers in the train then an average Swiss. That means that Ukrainians commute less then Swiss on the daily basis. Although many Ukrainians don’t have a car and use railway quite often, the business with passenger transport inside Ukraine is not profitable for the Ukrainian railways (annual loss of about Hr 6 billion). The company remains profitable mainly due to the freight transport.

Ukrainian railway employs a lot of cashiers. In each railway station there are dozens of the counter windows. Ticket machines are absent. At the moment it is possible to book a ticket for certain trains on the main routes and pay for it with a credit card online, but a passenger can’t print a ticket at home and has to receive it in the counter window. According to the press releases of the UZ, a print-at-home e-ticket will be introduced at the end of 2011.

But the most serious problem in Ukraine’s transportation system is not the intercity transportation, but the suburban infrastructure and regional public traffic. In the industrial countries population is divided into urban suburban and rural groups. In Ukraine the suburban group is the weakest one, because it is not possible to commute to the nearest bigger towns from some places. That’s why people have to live in overcrowded and polluted cities. Although there are regional trains and railway tracks in some suburban areas, bus remains the only way to get to and from most villages. There is a large number of small private bus companies who operate in rural regions and a small number of state-owned bus companies. Bus companies have to register their routes in a regional authority and get a license to operate on these routes. In most cases they operate only the routes to the villages and towns with enough population to make the route profitable. That’s why a lot of villages “die out” and people move to bigger cities. Monthly tickets are rather an exception than a rule and it can be very costly to commute from a village to a nearby town, because passengers have to pay for each trip.

Things to learn. After having read the press releases and having analyzed the activities of the UZ one might get an impression that the company is very efficient and competent in freight transportation and makes good profit in this sector but is not so good in passenger transportation. In Switzerland it is vice versa. Passenger traffic is very good and profitable business for the SBB, while SBB Cargo has experienced financial difficulties recently and is not profitable right now according to the balance sheets. Maybe SBB Cargo could learn something from Ukraine as well.

The fact is that passengers are not freight and should not be treated as freight. A modern railway company has to be a service-oriented enterprise and to offer its passengers top service and top comfort to survive in a competition with the other ways of transportation. The airplane transport is developing very fast in Ukraine, bus companies offer comfortable trips with modern buses between the big cities, car sharing projects are being launched and so on. In the market economy people do have choice between several products or services and can switch between them with ease. And realization of this fact is very important while considering and evaluating the options that Ukrainian railway has.

Transparency and organization of tenders. It is very difficult to find information about UZ (for example an organigram or a balance sheet) in the internet, although it is a state-owned enterprise. An interested person can find much more information about SBB on the company’s website, beginning from the organigrams through the photos of some employees to the balance sheets. Transparency is becoming a very important issue and modern companies have to be transparent and honest towards its customers, suppliers and the society they exist in.

Talking about state-owned enterprises in Ukraine, it is not possible to avoid talking about corruption, although it is an issue very difficult and unpleasant to talk about. I see corruption as one of the main obstacles on the way to the modernization of the country and its infrastructure. In many cases only the companies of the relatives or friends of certain authorities win the tenders published by the state enterprises. That often means that an enterprise either receives poor quality for an average market price or pays much more than the average market price for the average quality, or gets poor quality at very high prices. It is a well-known national problem and it has to be solved on the national level if Ukraine wants to be a competitive country. An effective compliance management at all levels, personal example of the upper management and efficient control system can lead to improvements in these area. Without political will to fight corruption it will be very difficult to improve the system.

Organization. I understand that Ukraine is a big country, but it does not mean that UZ has to be organized by the geographical principle. SBB also has geographical principle it the organigram on the lower levels of hierarchy. Division infrastructure has departments “Region west”, “Region east”, “Region south” on the certain level of its structure. There are also a distinction between departments responsible for the regional trains and inter-city trains in the organigram of the passenger traffic division. But the organization of the SBB by the divisions passenger traffic, freight traffic, infrastructure and real estate has a lot of advantages and can be considered by the UZ as one of the possible ways to reorganize itself. By the way, Serbian railway has already adopted such structure. After the separation of the railway tracks for passenger trains from the tracks for the freight trains there will be a perfect moment for the UZ to launch the process of reorganization.

Infrastructure and speed considerations. Travel times and speed of the trains and not the capacity seem to be one of the main issues for the Ukrainian railway. In Switzerland the capacity of trains has become the main problem (the growing number of passengers stretches the system to its limits). The main reason for the low speed of trains in Ukraine is the poor condition of the railway tracks. That’s why the modernization of the railway tracks has very high priority for the Ukrainians railway at the moment. Maybe the trains in Ukraine won’t travel as fast as TGV in France (300 km/h) or ICE in Germany (230-280km/h) in the nearest future, but I think that the speed of 200 km/h is a realistic goal and can be achieved in the nearest future on the most important routs. Considering the size of Ukraine, that would be a sufficient speed to make the trips comfortable for passengers. It is imaginable that most of the trains on the routes Kyv- Kahrkiv (480 km), Kyiv- Lviv (542 km), Kyiv-Odessa (476 km), Kyiv-Symferopil (828 km) and Kyiv-Donetsk (709 km) could become daytime trains departing several times a day. For these purpose, the railway tracks and the whole infrastructure on these routes have to be modernized and electrified. It will take a lot of money and effort, but it is inevitable in the future.

It is difficult to judge about financial situation of the Ukrainian railways without seeing the balance sheet. One of the sources of the financing the modernization could be the state budget. The question of modernization is also about ticket pricing policy. Ukrainian railway should reflect on whether Ukrainians are ready to pay more for the better quality of transportation. It is difficult to judge about purchasing power in Ukraine according to the official salaries information, because a significant part of the salaries is being paid illegally in the envelopes. Of course, tickets should be affordable to the citizens and the slower night trains probably should be kept in the first years of modernization for people who can’t afford faster trains.

One of the positive consequences of the introduction of the daytime trains is avoiding the laundry of the bed linen. The passengers of the daytime trains do not have to sleep on the benches and do not need the bed linen (the price for which is now mostly included in the ticket price). This fact can save UZ the necessity to make tons of laundry and will reduce the environmental damage and costs.

Electrification of the railway tracks will have another positive effect -- less carbon dioxide emissions from the diesel locomotives, which are now being used on the non-electrified routes.

Faster trains cab lay back more kilometers a day, increasing revenue per operating hour.

And last but not least, UZ will save money on paying extra bonuses to the train drivers and movement inspectors for working at night after introducing daytime trains. Labor statistics say that most accidents happen at night, so it is definitely safer to operate daytime trains.

The introduction of the faster daytime trains poses one other challenge. UZ would have to replace the rolling stock, because existing trains can develop speed up to 160 km/h only. First, a technical possibility of the renovation of the existing rolling stock with help of the own facilities of UZ must be considered. If it is not possible, then the new train fleet should be bought. There is a rolling stock producing plant (Kriukov car building works in Poltava region) in Ukraine, which produces passenger wagons and locomotives. According to website, the trains produced can develop speed up to 160 km/h. That means that UZ will have to buy the rolling stock abroad if this plant does not have enough technical expertise until the new rolling stock is needed. The enterprise can seek cooperation with foreign rolling-stock producing plants, which can help to get the know-how needed to build the fast trains. The renovation of the rolling stock could become an opportunity to create thousands of jobs in Ukraine and to bring technical innovations and know-how to the country.

According to the latest press releases that I’ve read, Ukrainian railway has already realized that faster daytime trains are inevitable and decided to separate the railway tracks for freight from the tracks from the passenger trains, which would allow passenger trains to travel with the speed of up to 160 km/h. UZ has also bought several trains of the South Korean company Hyundai, which will be used during the EURO 2012 as daytime trains between Kyiv, Lviv and Kharkiv and will reach the speed up to 160 km/h. That is very positive development and shows that UZ is on the right way. Maybe this approach of performing the modernization in two stages- first increasing the speed of the trains to 160 km/h then up to 200 km/h during the second stage- it is even more sustainable.

Internet appearance. The website of the UZ is quite confusing and it difficult to find things that one wants to find, but it might not be as important to passengers as the ticket-booking portal The portal does fulfill its purpose of booking and paying for tickets with a credit card, but it is not the best technical solution and the design is miserable. In addition, there is no English interface, although there is “English” button on the top. By clicking on this button, a user gets a Ukrainian interface. There are a lot of improvements which should be done on this portal. I hope that by the end of 2011 print-at-home e-tickets will be introduced as promised. Maybe the UZ officials can get inspired by the SBB website , where the passengers can get information about destinations in Switzerland and abroad, services on the railway stations and be inspired by the ideas of excursions to different places of interest.

Software. I wrote my bachelor thesis about a software issue and I understood how important software can be for a railway company. Modern enterprise- resource planning software allows to plan resources ahead, to perform better controlling and establishes more transparency. I don’t know whether UZ uses any ERP-Software, but if not it is definitely worth considering doing so.

Classification of trains. The existence of four types of wagons means additional administrative and maintenance costs. It would be more cost-effective to keep two classes of wagons in the daytime trains, which is already the case on the daytime train Kyiv- Kharkiv.

Ticket distribution. Employing an army of cashiers is not the most efficient way to distribute tickets. Salaries in Ukraine are not comparable with the salaries in Switzerland, but due to inflation, legal regulations and other factors it can be assumed that salaries in Ukraine will continue to rise from year to year. In the long term it will be inevitable to install ticket machines on the train stations, to develop the distribution of e-tickets and to reduce the number of counter windows. Such system has its advantages, for example passengers can buy tickets at any time and do not have to consider the opening hours of the counter windows.

The other advantage of such distribution channels is their transparency. Due to some manipulations passengers sometimes can’t buy tickets in the counter windows and have to buy them on the black market and pay much more than the tickets cost. In summer it is very difficult to buy tickets to Krym and other southern destinations and according to the news I hear from Ukraine, this summer it has been particularly difficult to do so. Such state of things should not take place in the European country which has ambitions to join the European Union. And of course there have to be some protection measures in the online ticket selling system and in the ticket machines against manipulations, for example a restriction on the number of tickets a user can buy at once with the same debit or credit card. I can imagine that it would be reasonable to narrow the ways of payment in the ticket machines to the debit and credit cards in order to reduce the risk of vandalism and to restrict the number of tickets one person can buy with the same card.

Another disadvantage of selling tickets in counter windows is that the counter windows require a lot of space. There are huge areas in the railway stations with nothing but counter windows. In contrast to the ticket counters, ticket machines are very compact and require little space. An extra space saved by reducing ticket counters can be rented out to shops, cafes, kiosks and so on or used for other purposes of UZ. Zurich main station is an example of how a railway station can be overfilled with sales areas. When I first got there, it was difficult to find ticket machines and information boards because I got distracted by the bright colors of shops and kiosks. By then it is quite easy to get oriented due to the numerous information signs.

Regional public transportation and mobility in rural areas. Although Ukraine is a unitary state and regions (oblast) does not have many freedoms, I believe that many problems can be solved on the local level. The problem of the regional transport system in rural areas without railway tracks may be solved by founding regional bus companies which would be responsible for the bus routes in the whole region. Such companies can be founded in a form of stock corporations and regional authorities could buy 51% of the stocks.

The existence of bigger companies has a lot of advantages towards the current system of big number of smaller companies. First of all, such a company could realize economy of scale. Second, it is easier for a bigger company to survive and to make larger investments and modernize its fleet. Third, such company would see the problems of the region as a whole and try to solve these problems together with regional authorities. Such a private company would need some control from the side of the regional authorities regarding security, prizing issues and the existence of certain routes, but I believe that most regional problems can be solved by the company itself (for example organizing bus on demand in sparsely populated regions, launching school buses or introducing monthly tickets for commuters). Subsidizing some routes could be a good way of helping people from villages to stay mobile. One of the regions of the western Ukraine could be a good candidate for launching the pilot project of such company. If the project is successful, it can be launched country-wide.

Mountain regions and building of tunnels. Building railway tracks in the mountain regions is a challenge. Switzerland has already managed this challenge with bravura. The new Gotthard tunnel in Tessin will be the longest tunnel in the world after its completion in 2015. Another mentionable and already finished Swiss project is a subway line in Lausanne, which is situated on the hills. Ukraine is primarily a vast country, but it has Carpathian Mountains in the west. Zakarpattia region is separated from the rest of Ukraine by these mountains. In general, the mountain regions of Ukraine are not very well economically developed and the infrastructure in these regions is mostly out-of date. Tourism plays an important role there. It takes the same time to travel from Ivano-Frankiwsk to the mountain village Yasynya (94 km) with a regional train as to travel from Zurich to Geneva (257 km) with an inter-city. By modernizing the railway track and using modern buses in the system of public transport it will be possible to give new impulses to this region. I am sure that these beautiful places will attract more tourists if its infrastructure is more efficient. The Ukrainian government could seek cooperation with the Swiss government to receive technical expertise on developing the infrastructure in the Carpathian Mountains at affordable prize.

Conclusion. Ukrainian railway has already made efforts during preparations to the Euro 2012 soccer championship, among them modernization of same parts of the infrastructure and providing online ticket reservation system, but the changes take too long and sometimes the services provided are not of sufficient quality. It is also clear that changes have to happen faster. I hope that after the Euro 2012 these good intentions will not be forgotten and the development of the UZ and Ukrainian public transport system will proceed. This article gave several suggestions on what can and should be done in the field of public transportation. The question of how it can be done is much more complicated and can be an issue for a subject for the articles in the professional journals.

The process of modernization is a long way to go and requires resources and time. But with persistency and effort bigger changes can occur very fast and projects, which seemed impossible short time ago, can be brought to life. Public transportation is not only about logistics and moving from A to B. It is much more about improving quality of life, caring about environmental issues and creating new opportunities for millions of people in Ukraine. With an efficient public transportation system it is possible to create new jobs, enable people to live in suburban areas and give new economic impulses to the regions which are depressive nowadays. If a forgotten abandoned village suddenly gets a scheduled bus line to the nearest town and it enables its inhabitants to commute, if it is suddenly possible to travel from Lviv to Kyiv in 3 hours and further to Kharkiv in 2.5 hours. then life becomes brighter, faster and full of opportunities and adventures.
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