German rail starts receiving €2.1b in Covid-19 relief

Aid worth more than 2 billion euros has started reaching German rail operator Deutsche Bahn and other companies in the sector to help make up for losses incurred during the coronavirus pandemic, reported dpa.

Starting this month, 2.1 billion euros in public funds are to be paid out to the group's DB-Netz division, said Enak Ferlemann, the government official responsible for the railways.

The compensation money will initially make up for revenue lost due to a lack of user charges on the long-distance rail network. Deutsche Bahn dominates long-distance transport with its ICE and Intercity trains.

The market shares of competitors Flixtrain and the Austrian federal railway with its night trains are small.

So far, only a small part of the direct and indirect state aid totalling 3.77 billion euros to the German railways that was approved by the EU Commission has been provided, according to Ferlemann.

There had been lengthy negotiations with the commission to avoid strict conditions under which the government in Berlin would be able to give Deutsche Bahn compensation for pandemic losses. One such condition could have been the break-up the federal group.