Business news from Ukraine

JSC Ukrzaliznytsia in 2022 does not plan to raise prices in passenger traffic.
“So far, there are no such decisions. We have indexed very smoothly this year. Not all at once, but in relation to the consumer price index and stretching for the whole year. On the contrary, we plan to stimulate individual services with promotional rates. For example, with tour operators, we are talking about how to support the transportation of large groups by rail by setting discounts on bulk reservations depending on the size of the group,” Oleksandr Pertsovsky, the director of the Passenger Company branch, said in an interview with Interfax-Ukraine.
He also noted that in the medium term, Ukrzaliznytsia plans to initiate a revision of tariff regulation in order to enter a more flexible pricing policy in the passenger segment.
“What I mean: a common practice among transport operators is that the earlier you buy tickets, the cheaper they are, and if at the last minute – the more expensive. to the price. This will allow us to increase the average profitability while still giving the best price to the individual passengers who are most price sensitive. As an option, make a greater distinction between classes. We are also working on the possibility of changing pricing in relation to distances,” he explained.
According to him, all this requires both certain regulatory changes and programmatic changes in terms of restructuring the current IT system of Ukrzaliznytsia.
The director of the Passenger Company branch also noted that in comparison with 2020, in 2021 Ukrzaliznytsia showed good dynamics in terms of covering expenses with income in the segment of passenger transportation.
To further improve the situation, the company is working on the introduction of contracts for socially significant transportation, since for many years the company had “a huge percentage of underfunding” from the local authorities.
“Plus, we are actively working on the issue of control over fares. In the suburbs, for example, we are piloting an IT system that allows you to sell tickets online or through kiosks, both single and subscriber for passengers. We are also reviewing the configuration of the turnstile system to reduce the percentage of free riders,” Pertsovsky said.
He also stressed that the idea of bringing passenger traffic to the level of prime cost is impossible within the framework of the current market model and does not make sense.