NS cutting 500 head office jobs to reduce costs

NS is cutting 500 office jobs at its head office to reduce costs. The Dutch rail company plans to do so through “natural attrition” rather than layoffs. It is also investigating whether it can cut back on train refurbishments, NS said with the presentation of its half-year figures on Thursday. The rail company suffered an underlying operating loss of 109 million euros in the first half of 2024.

“The costs incurred by NS to operate the train serviced remain higher than the revenues from the sale of train tickets,” the rail company said. “Although it cannot be completely prevented, NS is doing everything it can to ensure that the budget cuts have as little impact as possible on passengers and operations.

NS has been dealing with disappointing traveler numbers since the pandemic. Cost savings are, therefore, necessary to “improve financial performance and keep train tickets as affordable as possible.” NS expects the job cuts and associated reduction of office space to save it approximately 200 million euros per year.

In the first half of 2024, train passengers traveled 6.4 percent more kilometers than a year earlier. Despite the improvement, the number of passenger kilometers was still only 94 percent of the kilometers traveled in 2019, the last year before the pandemic. At the same time, costs have increased significantly due to high inflation and wage increases to protect employees’ purchasing power.

In the first half of this year, NS earned 1,802 million euros from transporting train passengers and operating its train stations. But its costs amounted to 1,914 million euros, resulting in an operating loss of 109 million euros. In the same period last year, the rail company suffered a loss of 87 million euros.

The net result for the first half of 2024 is a loss of 33 million euros, compared to a profit of 38 million euros in the same period last year. “In the first half of 2023, the net result was affected by incidental income,” NS said. “After correction for this, the net result for the first half of 2023 is comparable to the reported net result for the first half of 2024.”

NS also warned that train ticket prices may increase sharply next year. At the insistence of parliament, the government gave NS 120 million euros for 2024 to postpone an 8.7 percent increase in ticket prices. “That amount is not available for 2025, forcing NS to implement the postponed rate increase in 2024, on top of regular inflation.”