Why is Ukrzaliznytsia increasing transportation tariffs?

The constant increase in tariffs for freight transportation by "Ukrzaliznytsia" became the subject of sharp criticism from Olena Kolesnykova, the head of the branch council of the Federation of Metallurgists of Ukraine. She stated that such decisions are evidence of the inefficiency of the company's management, especially in the conditions of record growth in transportation volumes and revenues of Ukrzaliznytsia.

Kolesnikova noted that the next increase in tariffs for industrialists is "patching holes" at the expense of the enterprises that suffered the most. She emphasized that the management of "Ukrzaliznytsia" should provide an economic justification for changing tariffs, especially considering the concept of "convergence of classes" of cargo, which, according to her, is impractical.

"What is convergence of classes? One used logistics for 10%, and the other for 110%, and we have to pay the same? This is absolutely not economically justified. Therefore, we remain in the position that Ukrzaliznytsia should recalculate the tariffs, as they are too high for the industry," Kolesnikova said.

Kolesnykova also pointed out the need for effective management of resources and implementation of reforms in Ukrzaliznytsia in order to ensure the transparency of the company's activities and eliminate corruption. According to her, the lack of reforms and unjustified expenses incurred by the company indicate bad management.

"If they implemented the necessary reforms, there would be no strange purchases and unreasonable expenses. Now it seems that the effectiveness of their work is ensured solely at the expense of raising tariffs for those who already pay more than it is justified," she said.

"Ukrzaliznytsia" demonstrates record volumes of transportation, for the first half of 2024 the company reports a profit of UAH 3.1 billion. However, according to forecasts, a loss of UAH 2.7 billion may be recorded by the end of the year. The company's management has not yet explained the reasons for the possible loss, but has already initiated a new increase in freight rates.

The European Business Association called on "Ukrzaliznytsia" to focus on finding internal reserves and reducing operating costs, rather than transferring its financial problems to business.

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