Major Overhaul of Bulgaria’s Rail Passenger Services

Bulgaria is undertaking a major overhaul of its rail passenger services, with the state signing a contract with the country’s first private rail operator. The company will take over around 25% of BDZ’s (Bulgarian State Railways) passenger routes in Eastern Bulgaria, while the state railways will continue to operate Western routes and key lines such as Sofia to Varna and Burgas. The reform is seen as crucial for Bulgaria to receive the fifth payment under the Recovery and Resilience Plan.

The oldest railway line in the country, between Ruse and Varna, will be among the routes served by the private operator. It forms part of the Northern region network, together with the Southern lot, which will also be managed by the winning firm. Public opinion on the reform is mixed, particularly at the two terminal stations.

Malin Ivanov, Ruse, said:
“It depends on who the concessionaire is and what they intend to do — whether they aim merely to absorb funds or genuinely want to improve transport quality. I think competition will ultimately improve services.”

The selected company will serve 25% of all rail routes, leaving 75% of routes in the western part of the country under state operation.

Grozdhan Karadzhov, outgoing Minister of Transport, explained:
“Only two bids were received — one from BDZ and the other from Ivkoni.”

Both the private and state companies will use rolling stock purchased over the last 17 years.

Karadzhov added:
“The rolling stock acquired by the state since 2009 will be used by the operators free of charge, in proportion to the volume of services provided.”

Older trains may be leased from BDZ at market prices, and after the contracts expire, all rolling stock must be returned to the state. The Ministry of Transport has assured that current railway employees will not be affected.

Karadzhov said:
“A total of 813 staff will transfer from BDZ to the new operator, and all their positions, salaries, and social benefits will be fully preserved.”

Passengers expect the reform may lead to higher ticket prices.

Danaïl Yordanov, Ruse, commented:
“Certainly, prices will rise significantly because private companies need to make a profit.”

Karadzhov clarified:
“Profit for both operators is contractually and legally capped at 3.57%. That is, passenger transport services funded via subsidies cannot generate higher returns than this limit.”

For the first time, the state subsidy for rail transport will not go solely to BDZ. For the next year, the state company will receive €1.8 billion, while the private operator Ivkoni Express will receive just over €511 million. The contracts are set to come into force at the end of the year.