One of the largest railway carriers in Poland announced the decision to send employees to the so-called parking.
The management board of PKP Cargo also decided to terminate contracts with the Polish Olympic Committee (screen YT / pkpcargoTV)
This decision is a response to the serious financial problems the company is struggling with.
Parking allowance applies to all groups of employees
The management board of PKP Cargo announced that the decision to launch the parking program was made on 27th 0f May 2024. This is part of a broad recovery program aimed at rebuilding the company's value and market position. The program will cover a maximum of 30% of employees and will last for 12 months.
Parking will not be limited only to regular employees. The management board of PKP Cargo decided that it would cover all groups of employees, including plant management and the company's headquarters. Employees who are covered by standby leave will be exempt from the obligation to work, but will receive a social benefit in the amount of 60% of the monthly cash equivalent, calculated in the same way as remuneration for holiday leave. This amount will be reduced by mandatory contributions and tax.
Drastic steps in the face of serious losses
The decision to put employees on standby is part of a broader strategy aimed at improving the company's difficult financial situation. PKP Cargo recorded a loss of almost PLN 120 million in the first quarter of 2024. In response to these financial problems, the management board also decided to terminate all sponsorship agreements with sports clubs and the Polish Olympic Committee.
Loss of market and competition
The decline in PKP Cargo's financial results is largely the result of the loss of market share. Since the first quarter of 2019, the company's market share, measured by the weight of freight transported, has decreased from 43.4% to 32.1%, and in terms of transport performance (tonne-kilometers) from 46.1% to 32.5%. In the Czech Republic, PKP Cargo's share in the transport labor market was only 3.4% in the fourth quarter of last year, which is a decrease from 7.4% in the fourth quarter of 2019. These numbers show that the Polish state carrier cannot withstand competition on the market.
The future of PKP Cargo
The management board of PKP Cargo is aware of the seriousness of the situation and is taking drastic steps to prevent further losses. The shutdown program is just one element of a comprehensive recovery plan. Time will tell whether the actions taken will bring the expected results and allow the company to regain lost market shares and improve financial results.
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