Federal budget financing

At the beginning of 2020, we concluded an agreement with the Federal Government that sets out the financing of the existing network until 2029 (LuFV III). Risks arise from a potential failure to achieve the contractual objectives set out in the LuFV and from a possible reclaim by the Federal Government following audits of applications of funds for the intended purposes. Due to the sharp rise in construction costs, the 2024 budget was significantly increased via two supplementary agreements (NT 1 and NT 2) and a trilateral agreement (TriLa) with the Federal Government. Higher funding for the existing network is also planned for 2025. This will be provided in the form of equity increases. Further significant adjustments are required and have to be contractually agreed for the years from 2026, as the volume targets and the contractual obligations of the RICs under LuFV III can no longer be achieved with the funds agreed in LuFV III.

The economic viability of capital expenditures funded with DB funds or of financing contributions to capital expenditure projects is essential to ensure DB Group’s ability to invest in the long term.

Risks exist primarily due to the fact that infrastructure financing has not yet been sufficiently secured from 2026. Extrapolating the financing volume to 2028 results in an additional gap. There are also risks due to the provisional Federal budget for 2025, which are expected to remain in place until the newly formed Federal Government adopts a regular Federal budget for 2025. If the Government funds for infrastructure are not increased significantly, there would be considerable risks for network quality, transport performance and economic development. The transport policy targets would therefore not be achievable.

Risks also exist due to lower funding for infrastructure expenses from the Federal Government, such as if it is considered that planned expense topics are not eligible for grants. The contractual basis for the sufficient funding of the infrastructure is to be established in talks with the Federal Government.

In addition to the financing of infrastructure, the financing of specific issues of train operating companies is also very important. This applies, for example, to train-path price support in long-distance rail passenger transport and rail freight transport as well as construction and substitute services in local rail passenger transport.