STRATEGIC AREAS OF DEVELOPMENT

Network

Fundamental rail network optimisation is planned:

Transitioning to innovative rolling stock

The railcar fleet will be timely and fully renewed, with gradual transition to innovative rolling stock, which will constitute approximately 35% of the total rolling stock by 2025. Almost 7,000 carriages will be replaced between 2018 and 2025.

The Company also plans to replace its traditional carriages with double-decker carriages, for which over 1,000 carriages will be purchased by 2025.

Current condition of the passenger railcar fleet

The size of FPC’s passenger railcar fleet as at 31 December 2017 was 19,386 carriages. The age of more than 10,300 carriages is over 20 years.

The average carriage age is a key metric showing the technical condition of a railcar fleet. As at 31 December 2017, the average age of FPC’s carriages was 19.1 years.

Over 5,000 carriages will be retired from FPC’s passenger fleet by December 2020, and the Company has significantly increased the previously planned investment into rolling stock replacement and upgrades to compensate for the railcar fleet shortage.

Objectives and stages of the fleet replacement programme

A programme to develop innovative long-distance rolling stock up to 2025 has been adopted to meet the demand for long-distance rail passenger services with modern carriages that ensure safe and comfortable passenger travel. The Programme aims to:

• improve passenger travel comfort
• offer a wider range of passenger services
• decrease the passenger rolling stock’s average age
• drive innovation
• adopt modern passenger service technologies
• improve rolling stock utilisation
• wider passenger service geography
• streamlined operating expenses
• introduction of a fundamentally new maintenance and repair system for the innovative rolling stock.

The programme’s objectives will be implemented in three main stages:

• Stage I (2017–2019) – upgrading the purchased single-decker rolling stock
• Stage II (2019-2020) – upgrading the purchased double-decker rolling stock
• Stage III (2020–2025) – expanding the range of the rolling stock in operation.

Fleet replacement principles

The innovative rolling stock will feature an improved carriage design that is characterised by:

• personal space and privacy during rest
• spacious accommodation and freedom of movement
• low floors for easy boarding and barrier-free environment
• dedicated baggage areas
• advanced technical equipment
• IT-driven development (Digital Railway).

Power outlets for mobile devices, uninterrupted high-speed Internet access, local train-hosted multimedia content portal, a climate control system in each compartment, and environmentally friendly toilet facilities will be available in all new carriages.

The following standards form the basis of FPC’s long-term fleet optimisation programme:

• Conventional compartment and third-class sleeping carriages will not be purchased after 2020
• Third-class sleeping carriages will be replaced with carriages equipped with seats for short routes and double-decker compartment carriages for long routes
• Compartment carriages will be replaced with innovative (double-decker) carriages
• Innovative carriages will be purchased in increasingly larger volumes as their efficiency is confirmed through use.

Expected outcomes

Stages I and II of the Programme will result in:

• adoption of state-of-the-art technical solutions
• the next level of passenger travel comfort
• achieving a balance between passenger capacity and comfort
• adopting semi-automated passenger service technologies
• improved cost and energy efficiency.

Programme Stage III will result in:

• utilisation of the same rolling stock on railway sections with different electrification systems
• lower locomotive traction requirements
• less time spent on locomotive change operations
• end-to-end passenger service provided at non- electrified sections
• option to split trains and reroute train sections to different destinations
• a wider passenger service geography with minimal extra costs
• end-to-end travel without the need for locomotive replacement, equipping, or inspection of technical condition
• high-tech solutions supporting the range of scheduled maintenance and repair services
• reduced expenditures on manned locomotive lease due trains having own traction units
• reduced traffic at rail yard and passenger station necks through fewer locomotive transfers to and from locomotive depots
• reduced expenditures through servicing innovative trains in shared depots
• eliminating the need for shunters.

Product

The Company is preparing for transition to a new unified high-quality product offering that includes:

• three train types: daytime express trains, night trains, and traditional trains
• three service classes: economy, comfort, business

The older carriages lacking air conditioning units and composting toilets will be utilised under a separate, provisional “economy budget” brand until their eventual decommissioning.

Multimodality

Integrated multimodal solutions are to be developed utilising bus and air ticket aggregation (via code sharing).

The rail network will provide a platform for developing multimodal passenger transport chains comprising all modes of transport.

Other types of activities and adjacent businesses

The Company’s sustainability will be further enhanced by the Strategy, which encompasses business diversification as well as development of businesses which improve the profitability of passenger services through value-added service offerings:

• On-train passenger services
• Services for passengers using any means of transport
• Logistics services (cargo, mail, etc.).

KEY OBJECTIVES FOR 2018