Visible improvements in Hungary

Hungarian State Railways (MÁV Co) celebrates the 160th anniversary of its foundation this year.

The first railway line running between the capital city of Pest and Vác, a town situated 30km from the capital and operated by steam engines, opened on 15 July 1846. István Széchenyi and Lajos Kossuth, eminent reformers in the period after the turn of the 18th-19th centuries, recognised the social and economic importance of the railways and dedicated their talents to the creation and development of the Hungarian railway network.

The Hungarian railway system has always played an important role in European transport due to the country’s geographical and geopolitical position. International railway corridors pass through the country and almost 30% of the network belongs to the Pan-European railway corridor system. Consequently, the role of railways in Hungary’s European integration is indisputable. Hungarian Railways disposes over 7,723km of railway tracks, which constitutes 4% of the approximately 200,000km long European normal double track network. One third (2,580km) of the total Hungarian network is electrified. Approximately 14% of the railway network operated by MÁV Co is double track lines and 86% are single track lines. MÁV Co has a 2% share of Europe’s transport market based on the number of passengers transported and a 3% share based on freight volume.

MÁV Co’s modernisation programme

Railway companies all over Europe aim to adjust to the changed conditions when developing their strategies. They are improving the effectiveness of passenger and freight transport as well as the quality of services by modernising their organisational structures. MÁV Co launched its programme for improved efficiency in 2002 and the development of the organisation and renewal of the railway infrastructure are also included in the programme.

The tasks outlined in the modernisation programme are built on four pillars. Fundamental changes include handing over regulatory and supervisory rights to the newly established Railway Authority and organising profit-making activities – such as passenger and freight transport, traction/ maintenance – into independent profit centres, as well as separating these business lines from the track railway that operates the railway infrastructure. According to the expectations of the European Union, MÁV Co will separate the railway infrastructure from railway operator functions. By doing so, MÁV Co will create equal opportunities for all market players in accessing the railway infrastructure, as required by EU regulations. Passenger-friendly and customer-oriented operation is now supported by a transparent operating, controlling and financing system and related performance measures. One of our key aims is to improve MAV’s competitiveness through investments and by developing the organisation of the railway company (introducing modern management methods).

The first signs of modernisation are already noticeable.

The Freight Transport Division of MÁV Co has been outsourced as of 1 January 2006. Since then the activities related to freight transportation are carried out by MÁVCARGO, a 100% owned MÁV Co company that is nevertheless a separate entity. In order to comply with the liberalisation requirements of the EU and to meet the increasing challenges of European competition, MÁV Co plans to operate its Passenger Transport Division and later it’s Railway Infrastructure Division as independent companies as well.

During the last few months we have also taken significant steps towards improving the efficiency of the company by modernising the organisational structure and the management of finances and human resources. A new human management system has been introduced to optimise the organisation and the working processes of MÁV. The EU Program Directorate has been restructured and enlarged to ensure that EU funds are obtained and used more efficiently.

One of our top priorities is to prepare for obtaining and using to the maximum extent and with the best efficiency European Union funds becoming available with the launch of the 2007-2013 budget.

We can say that MÁV Co has made significant progress in ensuring the organisational, technical and financial conditions for implementing the modernisation programme and in carrying out the necessary preparatory work.

The improvement of the railway infrastructure

The modernisation of the railway tracks and the reconstruction of telecommunications, catenary systems and signalling equipment are underway across the whole network of the company, using EU subsidies, the companies own funds and other external resources. The up-to-date traffic control and information system now being introduced will make the Hungarian railway system compatible with the European network. The infrastructure at railway stations and the passenger information system are also being renewed during the line reconstruction works. In regard of the competitiveness of the railways, we pay special attention to interoperability. The preparations for the nation-wide GSM-R system has begun and we intend to install ETCS Level 2 systems along all major routes.

Between 2002 and 2007, the main financial resource for infrastructural investments has been and is the so-called pre-accession fund (ISPA, and the cohesion funds from 1 May 2004). These resources are being used to develop the Budapest-Cegléd-Szolnok, Budapest-Hegyeshalom and ZalalövŒ-Boba railway lines. The reconstruction of the railway line in the area of Érd has started, with funding from KIOP , in order to improve the conditions of suburban traffic.

We lay special emphasis on making use of the funds of the European Union that will become accessible for Hungary from 2007. As a result of implementing the pre-planned projects, by 2013 it will be possible to complete the modernisation of the Hegyeshalom-Budapest-Szolnok-LŒkösháza lines on corridor IV and of the Hodos-Bajánsenye-Ukk-Boba-Veszprém-Székesfehérvár-Budapest line on corridor V. The reconstruction of the alternative line of corridor V between Budapest-Cegléd-Szolnok, then the Szolnok-Debrecen-Nyíregyháza section and the main line of corridor V between Budapest-Miskolc-Nyíregyháza-Záhony can also begin, which will increase the track speed as well.

To the degree that our financial possibilities allow it, we will pay special attention to improving the technical condition of our buildings and the railway environment. Heritage buildings will get special treatment; all historic buildings, which have not yet been restored, are included in the medium-term property development plan of MÁV. The protection of the environment is regarded as a priority. In recent years we focused on investments in noise protection – partly using European funds. Last year new noise protection walls with a total surface of 21,000m2 were built along railway lines in Hungary.

The railway as a service provider

To become a true service provider, MAV Co continues to invest in upgrading the quality of its services for passengers and improving the timetable structure provided in passenger transportation.

Recently we have taken a lot of measures to renew and develop our rolling stock fleet. In addition to our 23 Siemens Desiro multiple unit trains, we now possess some new up-to-date vehicles; purchasing 30 Flirt and 10 Talent EMUs and 300 refurbished second-hand carriages from Germany. According to our vehicle development concept, within a few years, third generation cars with all convenience features will appear in the InterCity services.

MÁV Co also attaches great importance to the renovation of its old type carriage fleet. So far, 248 suburban cars have been refurbished and as of this year we started to renew 24 suburban cars and by 2010, 185 InterCity carriages and 20 dining cars will also be renewed. Furthermore, we plan to refurbish 60 power cars which will mainly improve the quality of services in regional passenger transportation.

In accordance with its strategic objective, MÁV Co regards the development of suburban and intercity traffic as a priority as well. In view of this priority, in the near future we are intending to extend the so-called timed and zoning timetables which are hugely popular with passengers, to all of Eastern Hungary. In cooperation with local governments and other public transport companies we are making efforts to establish intermodal junctions. We have taken part in the creation of the Budapest Transport Alliance and the preparation of several regional transport alliances is now underway based on this model.

The modernisation programme and the developments will make the operation of MÁV cheaper and more effective in the long run. Therefore, they predict the vision of a modern, stable railway company that is competitive in the European market. By 2013, MÁV Co will have implemented its plans and will operate as an effective and efficient service company that meets the demands of our times at a high standard.