According to a transport industry forecast, financing the Deutschlandticket in local and regional transport will be significantly more expensive for the federal and state governments in the coming year. The Association of German Transport Companies (VDV) forecasts demand of over one billion euros more for 2024 to a total of 4.09 billion. This emerges from a VDV paper for a federal and state working group available to the German Press Agency. The association cites an increase in ticket prices and an expansion in the number of users as potential measures to reduce the higher subsidy requirement.
The VDV warns in the paper that the ticket will be canceled. Without “sufficient budgetary provisions or an obligation to make additional contributions,” it would not be possible for companies to continue issuing and recognizing the ticket. The numbers are likely to fuel the financial dispute between the federal and state governments. Since May 1st, the ticket can be used for 49 euros per month as a digitally bookable, monthly-cancelable subscription throughout Germany. The federal and state governments each bear half of the associated losses in the industry. The federal government will provide 1.5 billion euros from 2023 to 2025. The countries contribute just as much.
Wissing rejects higher federal participation
Any additional costs beyond the three billion euros should also be shared in half in the first year. However, this “obligation to make additional contributions” is open from 2024 onwards – that is what the dispute between the federal and state governments is about. Federal Transport Minister Volker Wissing rejects the federal government’s higher cost share and points to the states’ responsibility for regional transport. According to the VDV paper, sales figures for the ticket are in “ramp-up” across all associations and companies. The association assumes there will be around 13 million regular users for a full year after its introduction – i.e. at the end of April 2024. The monthly termination option is being used more intensively than expected. This creates more planning uncertainty for transport companies. Overall, the price reduction in local public transport through the Deutschlandticket leads to “noticeable reductions in revenue” nationwide.
According to the forecast, given the shortened period of validity from May to December, there will be a need for subsidies of around 2.3 billion euros for 2023, so the money promised by the federal and state governments is sufficient. Of the 4.09 billion in subsidies needed next year, three billion have been firmly committed by the federal and state governments. The VDV cites the increasing number of passengers switching from other tickets as the core driver for the higher demand. However, this means that income from previous subscriptions and the sale of single tickets or monthly tickets decreases. This cannot be offset by the income from the Deutschlandticket. In the present scenario, the VDV estimates a price increase for the Germany ticket to 59 euros per month. There would be lower sales figures, but higher income. Depending on when the price increase starts, the need for subsidies from the federal and state governments would decrease – although the extent of a negative customer reaction to a price increase cannot be estimated with certainty.