Fret SNCF, the cargo division of the French national railway company will not recover the positions of 700 retired employees from 2018 to 2021, several media reported. These positions represent 14 per cent of its current workforce.

In addition, SNCF will eliminate the independent management team of Fret SNCF, which is set to become a wholly-owned subsidiary of SNCF Mobilités. From 1 January 2020 SNCF will be a national public company with two subsidiaries: SNCF Réseau and SNCF Mobilités. The capital of the national company will be fully owned by the state, contrary to earlier plans of the government to have no capital in the company.

Restructuring

SNCF Fret faced a deficit of 4 billion euros in 2017. After several attempts to strengthen the company, Macron´s government decided this year to restructure SNCF completely, as part of a modernising scheme reactivating the national economy. It considers the rail freight industry as a strategic sector and therefore pushed for the reforms.

In the last few years, the rail freight subsidiary has been losing market share. Apart from a change of industrial production, it faced fierce competition of new rail freight operators after the liberalisation of the European rail freight industry. Moreover, the French company is rivalling with other European national companies such as Renfe Mercancías, DB or RFI, which all acquired rail freight operators in Spain and eastern European countries.

Decline

The rail freight subsidiary of SNCF enjoyed its better years from 1950 to 1970, when it had an average market share of 75 per cent in France. It relied heavily on the importance of coal and iron industries. Its market share fell to ten percent in 2006 and its handled volumes declined by fifty per cent between 2006-2016.

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