Russian Railways (RZD) is sending employees from management offices on unpaid leave. The operator’s freight business is facing a severe downturn, which is forcing it to take financial measures.
Employees have been forced to take two days per month off at their own cost since June, according to Russian media. They cite sources explaining that the policy does not constitute a “formal decision” and only impacts the management department of the company.
“The decision is grounded in a wish to keep the staff of the company, which would have to be shrunk in the current economic situation. The situation was discussed with the rail trade union, which supported the proposal about two holidays”, a source is quoted as saying.
Shippers leave RZD stranded without a payload
Russian media and RZD sources say that freight no-shows are the primary reason behind the unpaid leave measure. In recent months, more and more companies have booked RZD’s rail services, only to cancel the transportation at the last minute. In March, shippers failed to load 4,5 million tonnes of freight for which rail transportation was booked, according to RZD. By May, that had grown to 24,5 million tonnes.
The failure of shippers to present freight for transportation could have aggravated the problems with loading on the Russian network. RZD is now on a long streak of declining monthly loading rates, with the decrease accelerating in recent months.
Russian Railways now wants to increase the fines for freight no-shows. Those were last revised in 1998, according to Russian media, and are set at ten rubles (0.10 euros) for a tonne of freight, and between 50 and 200 rubles (2.16 euros) for a container.
RZD has struggled to meet transportation demand, especially on particular stretches of rail towards China. With such low fines, it becomes attractive for shippers to book capacity to guarantee a slot on RZD’s busy network, even if the shippers are not yet sure that there will be goods to ship.
The operator now wants to raise fines ten times to make no-shows more costly for shippers.
RZD’s problems are older than this
Even if RZD cites freight no-shows as the underlying reason for the unpaid holiday, the financial problems at RZD precede these problems. In 2024, the operator’s net profit dropped nearly ninefold – from 118,3 billion rubles in 2023 (approximately 1,3 billion euros) to 13,9 billion rubles (around 150 million euros). In the first half of 2025, RZD’s net profit fell by 95% to 2,7 billion rubles (approximately 30 million euros). In other words, essentially all profits have evaporated in a matter of about two years.
That has happened in part because of a lack of train drivers and maintenance staff. RZD has also struggled with a shortage in locomotives and spare parts, and a reorientation of trade towards China has put growing strain on the capacity of the Russian rail network. Trains need to travel much further on average to export goods than previously.