DB Schenker sale: “A serious strategic mistake”

Deutsche Bahn’s agreed sale of its logistics arm DB Schenker to DSV has received approval from the Supervisory Board, in an extraordinary meeting on Wednesday. Additionally, the federal government has approved the transaction under the Federal Budget Code (Bundeshaushaltsordnung-BHO).

The sale, according to DB is expected to be completed during 2025, however, Martin Burkert, Chairman of EVG, the railway and transport union which opposed the sale, said it is “a serious strategic mistake.”

“This is not a smart corporate policy. In the supervisory board, we once again presented our fundamental arguments against the sale of Schenker and made clear what advantages there would be in keeping Schenker in the rail system network. Unfortunately, we as the employee side were outvoted by the owners and employers,” Burkert said.

With the sale approved, the EVG now is focusing on ensuring that financial proceeds from the sale end up being used to reduce DB’s debt. “We now expect a clear commitment that the sales proceeds must be used to reduce DB AG’s debt. This is necessary in order not to jeopardize the group’s financial flexibility. The company must invest in new vehicles and better service quality in order to be future-proof. In order to finance the infrastructure, the federal government must finally take responsibility by providing multi-year financing. Deutsche Bahn must not become Christian Lindner’s cash cow. The railway employees are not the ones who clean up after a misguided budget policy,” Burkert added.

DB Supervisory Board Chairman Werner Gatzer said the sale is a milestone for DB as it now can “concentrate on the renovation of the domestic rail infrastructure and the operation of climate-friendly passenger and freight transport in Germany and Europe.”

“The proceeds from the sale will significantly reduce DB’s debt and make an important contribution to the financial stability of the DB Group. At the same time, Schenker is gaining a strong strategic owner in DSV,” said DB CEO Richard Lutz.

The social component

Burkert stressed that the social component of DSV’s bid is far from sufficient. “The negotiated guarantees are not specific enough and are limited to two years. There is a threat of massive job cuts.”

The guarantees made by DSV are that the job cuts will be limited to anywhere between 1,600 and 1,900. However, according to the workers union ver.di which also opposed the sale to DSV expects some 5,300 job cuts.

Industry experts predict a wave of Schenker workforce to hit the market in the coming years. It is also expected that they will head for small and medium freight forwarders with a more people-focused business model rather than just an employee number.

In its statement announcing the approval of the sale, DB said that DB Schenker, with its approximately 72,700 employees at over 1,850 locations in more than 130 countries, will be able to continue to develop in conjunction with DSV.

“Planned investments of around one billion euros in the coming years are intended to promote additional growth potential,” the company said.

In its comment on the Supervisory Board’s approval ver.di demanded that jobs, co-determination and collective bargaining agreements be permanently preserved.

“After months of discussions in the sales process, colleagues are understandably unsettled. They finally need clarity and certainty that their jobs will be preserved. DSV has been awarded the contract; now the group has a duty to secure jobs at Schenker in the long term,” said Stefan Thyroke, ver.di’s national logistics group leader. “And it is also clear to us that DSV must be bound by collective agreements in the long term.”