Russian Railways JSCo RZhD (ОАО «РЖД»)Russian Railways JSCo RZhD (ОАО «РЖД»)Russian Railways or in Russian: ОАО «Российские железные дороги» (ОАО «РЖД»), romanized: OAO Rossiyskie zheleznye dorogi (OAO RZhD)) is a Russian fully state-owned vertically integrated railway company, both managing infrastructure and operating freight and passenger train services. The company was established on 18 September 2003, when a decree was passed to separate the upkeep and operation of the railways from the Ministry of Railways of the Russian Federation. RZhD is based in Moscow at Novaya Basmannaya str., 2. The operating units of the central part of the staff are at Kalanchevskaya str., 35.
Russian Railways RZD Background And 2003 Reform After the collapse of the Soviet Union in 1991, the Russian Federation inherited 17 of the 32 regions of the former Soviet Railways (SZD). In the mid-1990s, the profitability of railway transportation of the Russian Ministry of Railways fell to negative values, the bureaucratization of the ministry itself was publicly criticized, which became an occasion for reforms. Shortly after being elected president of Russia in 2000, Vladimir Putin approved the idea of reforming the railway transport, according to which all economic functions on the railway should be transferred to a joint-stock company with 100% state participation. The start of the state program for reforming the Russian railway sector was given by the establishment of Russian Railways in October 2003. The new company received over 95% of the assets belonging to the Ministry of Railways of the Russian Federation. In 2003, the Federal Law on Railway Transport divided the Ministry of Railways into the Federal Railway Transport Agency (FRTA) and Russian Railways (RZD). The reform also required RZD to provide access to railway infrastructure to other carriers and operators. As the law requires carriers to provide service to customers anywhere in Russia, RZD retained its dominant position. Later in 2003, the Decree No. 585 established RZD as a joint stock company, making it a holding in charge of 63 subsidiaries, including TransContainer, RailTranAuto, Rail Passenger Directorate, Russian Troika, TransGroup, and Refservis. RZD acquired 987 companies (95% in asset value) out of the 2046 that had formed the MR system. Gennady Fadeyev, the Railways Minister, became the company's first president. The reform saw the creation of a new market segment following the privatization of the network's rolling stock. The company divided the bulk of its wagon fleet between two new operating companies, Freight One (which was later privatised) and Freight Two (renamed Federal Freight in 2012), and private players such as GlobalTrans also entering the market.Russian Railways RZD 2000s
In 2010, Federal Passenger Company was established as a fully owned subsidiary of Russian Railways, providing long-distance passenger services both in Russia and abroad. By the end of 2013, it operated all long-distance routes, except for high-speed Sapsan lines, which are operated by RZD. RZD issued its first dollar-denominated bond in 2010, raising $1.5 billion. On 28 October 2011, the Joint Stock Company Freight One, a subsidiary of Russian Railways, sold 75% of its shares minus two shares for 125.5 billion rubles (about 4 billion $) to Independent Transport Company owned by Vladimir Lisin. Thus, Lisin as Russia's largest operator of rolling stock acquired control of a quarter of the freight market. As part of its reform efforts, RZD massively reduced its workforce, from 2.2 million in the 1990s to 934,000 people in 2012. In 2012, it became one of the three largest transport companies in the world. According to a Reuters inquiry, RZD procurement activities in 2012 amounted to $22.5 billion, part of this was awarded to private contractors with no genuine operations in de facto noncompetitive tenders. Some of the company addresses listed on the tenders turned out to be private apartments, car repair shops or department stores. It was alleged that the contractors were actually shell companies, used to convey billions of dollars in tenders to close associates of Yakunin, president of RZD. Zheldoripoteka, RZD's real estate arm, was revealed to have sold land plots located close to railway stations in major cities to the son of Russian Railways president Vladimir Yakunin. Far East Land Bridge, a company partnered with a Russian Railways subsidiary, was also linked to Yakunin's son. On 16 October 2012, Russian Railways has completed competitive negotiations with potential buyers of the remaining 25-percent plus 1 share stake in JSC Freight One. The best binding offer was received from the Independent Transport Company LLC. The assets were sold for 50 billion rubles. In early November 2012, Russian Railways announced the purchase of 75% of the French logistics company Gefco SA. The total value of the transaction was 800 million euros, the seller being PSA Peugeot Citroen, the parent company of Gefco. A program to modernize the Baikal–Amur Mainline was launched in 2013, costing the equivalent of £4 billion by 2018. In 2015, RZD International won a €1.2 billion contract to electrify the Garmsar–Inche Bourun line in Iran. In August 2015, company president Vladimir Yakunin was dismissed, allegedly because of poor performance and mismanagement. Yakunin was replaced by Oleg Belozyorov. RZD International began works on the reconstruction of the Serbian Vinarci – Djordjevo line in 2016. The Moscow Central Circle railway, designed and managed by Roszheldorproject, an RZD subsidiary, opened in September 2016. In July 2018, the company announced plans to phase out third-class carriages on long-distance trains by 2025. Russian Railways RZD 2020s
In March 2016, RZD approved an updated version of high-speed rail development program until 2030. The 5 trillion ruble program includes the construction of Moscow–Kazan–Yekaterinburg, Moscow–Adler and Moscow–Saint Petersburg high-speed lines, as well as other high-speed lines connecting regional cities. The construction program is divided into three stages. By 2020, Russian Railways planned to put into operation the high-speed rail sections linking Moscow–Kazan (1.2 trillion rubles), Moscow–Tula (268.6 billion rubles), Chelyabinsk–Yekaterinburg (122.6 billion rubles), Tula–Belgorod (86.8 billion rubles), Yekaterinburg–Nizhny Tagil (12.9 billion rubles) and Novosibirsk–Barnaul (62.3 billion rubles). The project design of the largest container port in Ust-Luga for reception and distribution of containerized freight on China–Europe route is also part of the program. Between 2021 and 2025 RZD plans to build Rostov–Krasnodar–Adler, Tula–Voronezh high-speed rail and the extension of Kazan-Yelabuga high-speed rail, as well as other regional high-speed rail links. During the 2026–2030 third phase of the program, Russian Railways will build Moscow–Saint Petersburg high-speed rail section, the railway line will be extended from Yelabuga to Yekaterinburg, and from Voronezh to Rostov-on-Don. Russian Railways RZD Proposed Projects In March 2015, at a meeting of the Russian Academy of Science, Vladimir Yakunin presented an ambitious new transport route called the Trans-Eurasian Belt Development (TEPR) which would go "through Russia with a mega road and high-speed rail network to link Asia with Europe' and with the opportunity to go to Chukotka and Bering Strait and then to the American continent" to Alaska, "making overland trips from Britain to the US (via the Channel Tunnel) a possibility." Limited railway capacity is the main bottleneck for Russian coal exports to Asia. Demand for Russian coal in Europe has declined due to the energy transition and Russia's invasion of Ukraine and this reinforces the need for Russia to reorient coal exports to Asia. Various Russian actors have therefore proposed the rapid expansion of the country's eastward rail capacity. Russian Railways RZD Owners and Management The Russian Federation is the founder and sole shareholder of JSC Russian Railways. On behalf of its shareholders the powers are exercised by the Government of the Russian Federation. It approves the president of the company, forms the board of directors annually and approves the annual reports.
Gennady Fadeev was President of JSC Russian Railways from 23 September 2003 – 14 June 2005. He was succeeded by Vladimir Yakunin – from 14 June 2005 to 20 August 2015. Oleg Belozyorov has been president of the company since 20 August 2015. Russian Railways RZD Subsidiaries As of December 2013, Russian Railways has controlling interests in the following companies:
On 24 February 2022, in response to Russia's invasion of Ukraine, US President Joe Biden announced economic sanctions against several Russian companies, including Russian Railways. Russian Railways RZD Activities The main activities of Russian Railways involve freight and passenger traffic. In Russia, railways carry 42% of the total cargo traffic, and about 33% of passenger traffic. Some passenger categories, such as pensioners, members of parliament, and holders of Soviet and Russian state decorations, receive free or subsidized tickets. Russian Railways RZD Freight Traffic In 2013 railways carried nearly 90% of Russia's freight, excluding pipelines. In 2014, railway infrastructure and locomotive services accounted for 74% of the company's total revenue. The cost of freight tariff is determined by the Federal Tariff Service at net cost or higher. Limited railway capacity is the main factor limiting Russian coal exports to Asia. Demand for Russian coal in Europe has declined due to the energy transition and Russia's invasion of Ukraine and this reinforces the need for Russia to reorient coal exports to Asia. Russian Railways JSCo RZhD Overview Russian Railways Reporting Mark: RZD, RZhD Russian Railways Locale: Russia Russian Railways Dates of Operation: 2004–present Russian Railways Headquarters: Moscow Russian Railways Native Name: ОАО «РЖД» Russian Railways Company Type: Open joint-stock company Russian Railways Industry: Railways Russian Railways Predecessor: Ministry of Railways of the Russian Federation (1992–2004) Russian Railways Founded: 18 September 2003 Russian Railways Headquarters: Red Gates Square, Moscow, Russia Russian Railways Coordinates: 55°46′N 37°39′E Russian Railways Area Served: Russia Russian Railways Key People: Oleg Belozyorov (CEO) Andrey Belousov (Chairman) Russian Railways Services: Rail Transport, Cargo Russian Railways Revenue: $38.6 billion (2017) Russian Railways Operating Income: $3.47 billion (2017) Russian Railways Net Income: $2.39 billion (2017) Russian Railways Total Assets: $76.6 billion (2017) Russian Railways Total Equity: $41.3 billion (2017) Russian Railways Owner: Russian Government (100%) Russian Railways Number of Employees: 740,315 (2017) Russian Railways Track Gauge: 1,520 mm (4 ft 11+27⁄32 in) 1,435 mm (4 ft 8+1⁄2 in) (from Kaliningrad to Russian-Polish border) Russian Railways Electrification: 3 kV DC, 25 kV AC Main Russian Railways Length: 85,500 km (53,100 mi) | |||||
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