Rising costs overshadow Stuttgart rail project | Business | Economy and finance news from a German perspective | DW | 28.07.2010

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Rising costs overshadow Stuttgart rail project

German rail operator Deutsche Bahn has had a tough summer due to broken air conditioning, disgruntled customers and scrutiny from regulators in Brussels. Now rising costs could scuttle a prestige project in Stuttgart.

Stuttgart 21 causes trouble for Deutsche Bahn

'Stuttgart 21' is causing headaches at Deutsche Bahn

Deutsche Bahn's "Stuttgart 21" project is expected to cost 865 million euros ($1.1 billion) more than expected. Presumably even Deutsche Bahn (DB) chief Ruediger Grube had to take a deep breath when he heard about it. But on the outside he remained cool and relaxed while presenting the revised budget to the press.

"Based on a substantiated view of the separate sections and systems, the prospective construction and planning costs have now been calculated precisely," Grube explained together with Baden Wuerttemberg state premier Stephan Mappus.

The extra costs affect the construction of 60 kilometers (37 miles) of high-speed train track between Wendlingen, a small city near Stuttgart, and Ulm. Once the route is finished, it will only take 28 minutes to travel from Stuttgart to Ulm instead of 54 minutes.

Deutsche Bahn chief Ruediger Grube

Despite additional expenses the cost-benefit analysis works out for Ruediger Grube

Deutsche Bahn (DB) originally anticipated the route would cost just over 2 billion euros. But inflation and revised calculations for the construction of tunnels, tracks and bridges required additional investments worth 865 million euros, Grube said. This brings the total cost of the route to 2.89 billion euros.

Costs almost doubled

The high-speed line is part of a prestige project known as "Stuttgart 21" (S21). DB plans to redevelop Stuttgart's main rail terminus as an underground facility within the next nine years, replacing its dead-end tracks with through lines.

The project aims to streamline connections between Paris and Vienna and make Stuttgart "the new heart of Europe," according to the S21 slogan.

At the beginning the project, the station upgrade and tracks were expected to cost 2.5 billion euros. DB's head of infrastructure and services, Stefan Garber, was dismissed in December 2009 after he reported that S21 would cost one billion euros more than predicted.

Shortly afterwards Grube told German newpaper Die Welt that if costs rose above the revised price tag of 4.1 billion euros, he would probably have to cancel the project.

A development model of Stuttgart rail station

Many Stuttgart residents say the railway redevelopment is a waste of money

Calls for cancellation grow louder

Nonetheless Deutsche Bahn and the state of Baden-Wuerttemberg appear unwilling to back out of S21. Despite the rising costs, the project is "still reasonable from an economic and microeconomic point of view," the new DB head of infrastructure and services Volker Kefer said.

Baden Wuerttemberg's premier Stephan Mappus said he thought the revised budget was "manageable and justifiable".

Critics say that was an easy statement to make because it is mainly the federal government that has to pay for the Wendlingen-Ulm route. Mappus has already refused to invest more than the 950 million euros previously agreed by the Baden-Wuerttemberg government.

As a result, calls for authorities to reconsider the project are getting louder in the German Bundestag.

"Not two but almost three billion euros - for the German government that's a breathtaking cost increase of 50 percent," said Winfried Hermann, MP for the Greens and head of the parliamentary transportation committee. "Many experts even predict that in the end the route will cost 4-6 billion euros."

Stuttgart rail station

Stuttgart's main station is to be converted from a terminus to a through station

Too expensive, too intricate, too volatile

That is exactly what opponents of the S21 project have been saying for years. And there are many of them: In Stuttgart the project is a highly controversial topic. Citizens' groups have been staging regular protests against the construction from day one.

On Monday the police had to clear the north wing of the station after more than 50 protesters had occupied the building while several hundred more demonstrated outside.

Gangolf Stocker's initiative "Living in Stuttgart" supports the weekly demonstrations. He doesn't think the current cost calculation will last.

"It is a massive botch. We've seen the whole thing getting more and more expensive. We're guessing it will cost 8 or 9 billion euros for nothing," he told Deutsche Welle, describing the venture as nothing but an intrusion on nature - affecting ground water and mineral soil - and on personal property.

However, given the amount of money already spent and all the troubles endured, analysts say it is unlikely that S21 will really be called off. Preliminary work is on schedule so far, with construction due to pick up pace in August.

Author: Monika Griebeler
Editor: Sam Edmonds

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