Finnish Railways would have ordered new sleeper cars in around 2015

Political considerations trumped company’s own plans

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The purchase of new sleeping cars was to be part of the acquisition plans of Finnish Railways (VR) in about the middle of the next decade, but political considerations were given a higher priority.
      Minister of Defence Jyri Häkämies (Nat. Coalition Party), who is also responsible for matters related to state corporate ownership, decided at an extraordinary meeting of the VR Group on Wednesday that VR will order 20 double-decker sleeping cars.
      The state owns 100 per cent of VR’s shares, and the minister responsible for state ownership is entitled to make unilateral decisions.
     
A competition for tenders for the manufacture of the rolling stock is to take place, according to EU rules, but it is generally considered a foregone conclusion that the contract will go to the Kainuu-based Transtech.
      Transtech has already built 20 double decker waggons for VR, and the new sleepers can be based on the design of the earlier model.
      In addition, the series of 20 cars is so small that it is considered unlikely to spark much interest among large international manufacturers.
      Minister of Transport Anu Vehviläinen (Centre) admitted that a request sent by Transtech to the government for a new order had an impact on the government’s action. However, she denied that considerations of regional policy had anything to do with the decision to move forward the order.
     
Häkämies spent all last week on official business in Africa and arrived at the discussions on the VR acquisitions during the weekend. He did not want to give specific details on how the views of the National Coalition Party and the Centre Party differed, but he said that there were subtle differences.
      Häkämies admitted openly that concern about Kainuu affected the final outcome.
      Vehviläinen said that VR needs new sleeping cars for its routes to Finnish Lapland.
     
“They were not part of our investment programme yet, but I guess that they will be soon”, said Veikko Vaikkinen, CFO of the VR Group.
      Pekka Timonen, director-general of the state ownership steering unit of the Prime Minister’s Office, said that the decision emerged without a proposal from the VR board and administration, and that the state, as the company’s owner, bears full responsibility. Häkämies also emphasised the responsibility of the state as owner.
      The management of VR had opposed bringing the order forward, and VR Group CEO Henri Kuitunen and Chairman of the Board Antti Lagerroos submitted their resignations on Tuesday.
     
CFO Vaikkinen said that under original plans, the sleeping cars were to have been ordered about midway through the next decade. Meanwhile, there is a need to replace ageing blue passenger carriages, the oldest of which have already been decommissioned.
      “Let’s just say that we can’t start replacing the blue cars, now that these sleeping cars were ordered on our behalf. We don’t have enough money for just everything.”
     
Timonen says that the order for sleeping cars is normal commerce, which VR will pay itself. The company is in good shape, and its bottom line is healthy. Both the management of VR and the Ministry of Transport and Communications were consulted when the decision was under consideration.
      Timonen did not want to speculate on what the order would cost. Transtech’s previous train cars cost EUR 3 million apiece.


Previously in HS International Edition:
  VR directors quit because of dispute over new passenger coaches (22.10.2008)

Helsingin Sanomat