January 18, 2020, by Olivier Sancerre
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The first steps of the new CEO of SNCF, Jean-Pierre Farandou, are particularly difficult. To raise the bar of a company strongly affected by the strike against the pension reform, he announced a savings plan.
Nearly a billion euros in lost revenue
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Since December 5, the movement against pension reform has seriously disrupted rail traffic. SNCF is, along with RATP, one of the companies most affected by the strike. Jean-Pierre Farandou, in place since November 1, 2019 at the head of the group, made the accounts on the occasion of his first board of directors. And they are not good. He confirmed that the shortfall represented 22 million euros every day, for a total of 600 million euros over the whole of 2019. To this is added an additional 250 million for 2020. “In total, we will not be very far from the billion euros in losses,” said the boss of the SNCF.
A very heavy load which weighs on results which, without the strike, would have been very good, he deplored. “But there, it will hurt, it will damage us.” The 600 million shortfall for the year 2019 will cancel all the profits that the company should have made. The accounts could even be in the red. But for 2020, a savings plan will be needed: “we will try to make up for some of the 300 to 350 million losses that the strike should cause in 2020”, explains Jean-Pierre Farandou.
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SNCF “damaged” by the social movement
The first measures of this plan will be known in late February or early March, during the group’s next board of directors. One thing is certain, however: there is no question of touching on “production employment”, in other words, positions in the field. It will therefore be necessary to sell real estate, which the SNCF does not lack, and cut into administrative jobs …
It is likely that subsidiaries in France and abroad will not be affected: Eurostar, Keolis, Geodis and the others are profitable. Another side: a plan to win back customers who, because of the length of the strike, have embraced new modes of transport. SNCF wants to see them on its trains, hence the sale of 500,000 tickets for less than 40 euros. A strategy that risks further increasing losses in the short term…
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