JSC Ukrzaliznytsia plans to receive 40 General Electric locomotives, engines for locomotives, etc. under the Lend-Lease program, Head of Ukrzaliznytsia Oleksandr Kamyshin has said.
At the same time, with the beginning of the active phase of the war unleashed by Russia against Ukraine, the company managed to keep almost all of its rolling stock, unlike in 2014, when a significant part of the rolling stock remained on the lost territory, Kamyshin said in an interview with Forbes Ukraine.
According to him, in particular, out of 30 GE locomotives, 29 were taken out. The company failed to take one, as it was being serviced in a non-working condition in the Melitopol depot.
The head of Ukrzaliznytsia also said that the company is counting on increased state support, compensation from the Russian Federation and the Lend-Lease program.
“We have shaped a large list [for Lend-Lease]. Of the important, there is a request for 40 GE locomotives worth $250 million, engines for the modernization of our other locomotives, special vehicles for infrastructure restoration, and so on. Further, this list is approved by the working group. Let’s see what we can get it,” Kamyshin said.
He also said that now is not the time to raise passenger tariffs, but the compensation mechanism from the state still needs to be improved. At the same time, regarding tariffs for freight transportation, according to Kamyshin, the dialogue in the government is still ongoing.
The head of Ukrzaliznytsia also said that the operating gap in the company today is UAH 2-3 billion per month, and if the ports do not open, the company will not be able to close it on its own.
“We received a support program for UAH 10 billion from the state budget. It ended in May. Now we are talking about the second round of state financing before the end of the year. It will be bigger,” Kamyshin said.
He said that in the first days of the war, the daily load on the railway was reduced from 700,000 tonnes to 150,000 tonnes. In March, Ukrzaliznytsia transported 257,000 tonnes per day, in April – 295,000 tonnes per day, the company ended May with volumes of 300,000 tonnes per day.
Head of JSC Ukrzaliznytsia Volodymyr Zhmak does not see the need for further purchase of diesel locomotives of the U.S. General Electric.
“As for cooperation with General Electric, today I do not see the need for further purchase of General Electric diesel locomotives. Our goal is to switch to electric locomotives, since it is much more cost efficient,” he said at a press conference on Thursday.
He said that Ukrzaliznytsia has eliminated the shortage of locomotives. “We have the first small achievements. For almost one month since the start of work, we have managed to eliminate the shortage of locomotives,” he said.
According to him, today, for the first time in a long time, Ukrzaliznytsia satisfies all transportation needs.
“There is not a single request for transportation that Ukrzaliznytsia did not satisfy. The market saw that we can transport. We can ship everything and do it quickly,” he added.
JSC Ukrzaliznytsia jointly with the Infrastructure Ministry of Ukraine have signed a memorandum of intent with General Electric Transportation (the United States) on the acquisition of 40 more locomotives made by the U.S. company.
“We agreed on the next phase of the acquisition of 40 GE locomotives. We plan that we will receive the first of them in 2020,” Head of Ukrzaliznytsia Yevhen Kravtsov wrote on his Facebook page on Monday.
According to Kravtsov, the new rolling stock will significantly improve the operation of the diesel locomotive traction and the overall operations of the company.
The head of Ukrzaliznytsia said that the first batch of 30 GE locomotives is already operating successfully and is demonstrating its effectiveness, performing about 20% of all freight work.
“According to our estimates, in 2019, only thanks to GE locomotives, we saved about UAH 100 million on fuel,” Kravtsov said.
According to him, the localization of production for the first GE locomotives should be 15%.
Ukrainian President Volodymyr Zelensky has reshuffled the National Investment Council, appointing two deputies head of the Office of the President of Ukraine and introducing officials from foreign companies.
In particular, Zelensky’s decree introduces Senior Vice President, CFO of General Electric (the United States) Jamie Miller, Board Chairman and Executive Director of Rakuten Inc. (Japan) Hiroshi Mikitani, as well as CEO at Bank Citigroup Inc. (the United States) for Europe, Middle East & Africa (EMEA) David Livingston (all three by their consent) as members of the National Investment Council.
The President introduced Livingston to the National Investment Council instead of Chief Operating Officer for Europe, Middle East & Africa (EMEA) at Bank Citigroup Inc. James C. Cowles.
In addition, deputies head of the office of the President of Ukraine Oleksiy Honcharuk and Vadym Prystaiko were approved members of the council.
The regional branch Prydniprovska Railways of JSC Ukrzaliznytsia has selected Transportation Ukraine LLC to procure spare parts to U.S. General Electric locomotives for the total amount of UAH 3.12 million.
According to a report in the ProZorro e-procurement system, the deal was signed using negotiations due to the absence of competition among suppliers.
The subject of the deal is eight types of spare parts to General Electric TE33AS locomotives in the amount of 864 units. The term of the delivery is before December 31, 2019.
Transportation Ukraine LLC with a charter capital of UAH 28.1 million was registered in July 2018 in Kyiv. The founder is Transportation Systems Holdings Inc. (the United States). Gokhan Bayhan, GE Transportation’s General Manager for Russia/CIS, Europe, Middle East & North Africa, is the head of the company.
As reported, Ukrzaliznytsia has completed the first stage of the strategic cooperation with General Electric on supplies of locomotives.
JSC Ukrzaliznytsia has received the last five locomotive made by General Electric Transportation (the United States), Ukrzaliznytsia Board Chairman Yevhen Kravtsov has said on its Facebook page.
Ukrzaliznytsia received all 30 contracted locomotives GE. The last five met in Chornomorsk on Friday [February 1],” he said.
The received locomotives will be sent to Kriukov Car Building Works (KCBW, Poltava region) for retrofitting, where 10 more U.S. locomotives are already in work.
According to Kravtsov, GE locomotives show themselves to be extremely effective.
“As an example, we save fuel by 30% in the Zaporizhia-Kamysh-Zoria-Volnovakha section. In addition, the locomotives of the old fleet run an average of 360 km per day, and GE diesel locomotives – 540 km,” he said.
According to the head of Ukrzaliznytsia, 15 new locomotives now ensure a quarter of diesel locomotive traction in the three regional branches where they operate: Prydniprovska, Donetsk and Odesa.