Rail freight business DB Cargo plans to cut almost 900 British jobs as its faces “unprecedented challenges” in its core markets.
The redundancies – almost a third of its UK staff – come after what it described as a “dramatic decline” in demand for transporting commodities such as coal by rail, as power stations that use the fuel are gradually shut down.
The crisis in Britain’s steel industry has also contributed to the job losses.
As well as axing staff, the company – the largest rail freight haulier in Britain – said it would reduce the size of its locomotive and cargo wagon fleet, and look at cutting the number of its depots.
Hans-Georg Werner, chief executive, said: “Responsible and successful businesses must evolve and reshape as their markets change and sometimes this means making tough decisions.
“Whilst this is a difficult time, reshaping the company will enable us to build a business for the future and protect the majority of jobs.”
Outlining the challenges faced by the business, DB Cargo said that in the first nine months of this year it ran 1,353 coal trains – 78pc down on the same period the previous year.
As Britain’s steelmakers battle for survival, demand from the industry also declined, with DB Cargo running 5,820 steel trains in the first three quarters of this year, a third less than in 2015.
However, Mr Werner said that he “firmly believed” that rail freight had a future in the UK.
“Our motorways and roads are becoming more congested and rail offers fast and clean supply chain solutions,” the chief executive said, claiming that a new strategy in the wake of the job losses would make the company the “perfect choice” for customers in sectors such as construction and automotive.
However, DB Cargo’s plans were attacked by union leaders. Mick Cash, general secretary of the Rail, Maritime and Transport union, said the job losses were the result of “cut-throat practices” in the industry and insufficient government support for what he called a “key section of our transport infrastructure”.
The Transport Salaried Staffs Association said the redundancies were a “devastating blow” to Britain’s rail freight industry, cautioning that without a comprehensive plan to support rail freight, the UK’s ability to have an environmentally friendly, as well as economic, transport infrastructure was under threat.