NS posts €304 million annual loss; Frequent delays led to €5.4 million in refunds

Dutch national railway NS suffered operating losses of over 300 million euros in 2022, despite seeing revenue rise by more than a third to top 3 billion euros. The railway was also plagued with performance issues, as fewer than 92 percent of all trains were on time, which was worse than before the coronavirus pandemic. As a result, passengers received compensation of nearly 5.5 million euros to make up for the problems.

NS earned 3.1 billion euros from ticket sales and operating stations. That is considerably more than the 2.3 billion euros from a year earlier. The underlying operating loss amounted to 304 million euros. In 2021, NS spent over three times as much (952 million euros) on running trains. Then, more people stayed home due to the coronavirus restrictions and broader work-from-home agreements. The rail company received 274 million euros in compensation from the government for the reduced passenger numbers and 12 million euros in wage support subsidies through the NOW scheme.

NS was also able to release 385 million euros in money previously put in the noose pot. In 2020, NS had booked a write-down of 1.6 billion euros, but that turned out to be too high due to availability payments that the government gave to run as many trains as possible.

But the rail company’s performance was still disappointing. 91.6 percent of trains ran on time, down from 94.4 percent in 2021 and 92.6 percent in pre-pandemic 2019. The chance of a seat during rush hour also decreased. But NS emphasized that the figures say little about travelers’ individual experiences because there were many problems and many train cancellations. The company called 2022 a “year of extremes.”

Even though the NS technically hit its performance target, it ultimately paid out 5.4 million euros in passenger claims. About 2.2 million euros was handed out to passengers who made claims when their trains were delayed. That money was distributed to the customers who filed the 185,000 claims last year.

Another 3.2 million euros was handed out to cover the cost of replacement transportation services. These refunds were issued to cover nearly 32,300 claims.

When a train operated by NS runs at least 30 minutes late, many passengers are entitled to receive 50 percent of the fare as a reimbursement. The entire cost of the ticket is refunded when the delay is over an hour. Customers are not entitled to refunds when the circumstances causing the delay are out of the railway company’s control, such as a nationwide power outage.

The NS also does not transfer refunds for amounts below 2.30 euros or when the delay and increased travel time are announced in advance.

Wouter Koolmees took over as the NS CEO in November. He said the company was surprised by how quickly the shortage of conductors and engineers developed, saying it was caused by a combination of scaling up the timetable and more sick leave requests, also due to coronavirus infections. He acknowledged that the NS shortchanged its passengers last year.

NS tried to make adjustments every day due to the problems, including canceling journeys and shortening trains, which often caused larger rush hour crowds, to the dismay of passengers. At a certain point, it was also no longer possible to schedule trains and personnel in the right places, Koolmees said. At the same time, the pressure intensified on an ever smaller group of conductors and train drivers. For them, the pressure became “unacceptably high,” he explained.

In addition to personnel problems, there was also a major IT failure, a problem with a high-voltage power line in Flevoland and strikes for a new collective labor agreement. “All in all, that put the company under great pressure for a long time,” the NS director stated. “Travellers and employees were the victims of that.”

Only when it was decided in September to adjust the timetable did things gradually improve. At the same time, the recruitment of new employees started again. NS was able to fill almost 5,200 of more than 7,000 vacancies. In total, almost 51,000 people applied for jobs at the rail company. Koolmees said he believes that NS is now past the worst and “has come around the bend.” Yet the future remains challenging. “There are still not enough travelers to balance our internal budget. The increased energy prices and the sky-high inflation are not helping.”

In addition, the NS must continue to invest, said Koolmees. “We still expect a large increase in the number of travelers towards 2030, but with changing travel patterns and different travel behavior.” The timetable must match that behavior, stated the NS director. This can be done with more trains, but also with longer trains and modifying the times when those trains run. “It will be different than it was.”