State-owned train operator DSB has announced it will shut down its travel agency business on June 1 as part of a massive cost-savings plan that the company hopes will set it back on track.
The decision came after year-end reports revealed DSB was running massive deficits; in the first three quarters of 2011, the budget shortfall topped half a billion kroner despite increases in earnings and passengers.
However, the business growth has failed to keep pace with spending, largely due to investment losses on the scandal-ridden IC4 train upgrades.
DSBÂ’s management has therefore produced a plan to cut spending by approximately one billion kroner per year by 2015. Eliminating its travel agency division is just one element of that plan.
As of June 1 customers will no longer be able to book complete holiday packages, including hotel reservations and flight tickets, with DSB. Instead, the company will refocus on train travel.
DSB will continue to sell national and international train tickets from its call centre and on its website, as well as from select train stations.
“The management has decided to put everything into making our core business area run perfectly. Shutting down the travel agencies is just one element,” Anne-Lise Bach Sørensen, DSB’s head of sales, said.
The 14 travel agency closings will affect some 100 employees.
Many of them will be offered other jobs in the company, according to Sørensen, who added that customers had no reason to worry that their travel plans would change or lack service.
“Anyone who has bought or ordered a package tour from us can still go and rest easy. We guarantee the trips and we’ll still be available for advice after May 2012.
However, as Sørensen noted, the travel agency closings are just one element in the complete savings-plan DSB has unveiled. As many as 1,000 jobs will be eliminated once the other elements come into play.
On Thursday last week DSB reached an agreement with the labour union Dansk Jernbaneforbund, which represents more than a third of DSBÂ’s employees. The agreement calls for the elimination of 368 jobs. Some of those will come through attrition and reassignments to other jobs. Others will come through voluntary retirement packages.
