SJ – from Public Authority

to Limited liability company

Stockholm, April 16th, 2013

Elisabeth Lindgren, Vice President

Markets, Corporate Communication & Sales

2

Sweden has more than

12,000 km of railway track – 2,000 double tracks

– 10,000 single tracks

SJ has a 55% share of the

total Swedish rail market

SJ operates 90% of rail

passenger services in

Sweden exceeding 100 km

Rail traffic in Sweden

• SJ Regional

• SJ High speed

• SJ InterCity & SJ Night

Umeå/Luleå/Narvik

4

SJ AB

Limited liability company

owned by the Swedish state

The mandate

• To operate passenger rail

services

• both in competition and in

co-operation with others

The requirement

• To be profit-making

• 10% return on equity

Dokumentnamn SJ 2004-04-19

SJ’s objective: - A modern, profitable and customer oriented travel company -

Approx. 4,000 employees

Sales of SEK 8.5 billion in 2012

Limited liability company

owned by the Swedish state

110,000 passengers per day

Travel services under our own

brand

Contract rail services for

regional transport authorities

6

Modern milestones that

changed operations

1988 Separation of operations

• Banverket - infrastructure

• SJ - passenger operation

2001 SJ AB was founded

• from Public Authority to Limited liability company

Refined business

• Green Cargo, Jernhusen, Euromaint, EDB, Unigrid became separate operations

SJ as a limited liability Company

- modern history

2001: -49 millions SEK

2002: -994 millions

• ”Bancrupcy”

2003: millions

• 1,8 billions in owner contribution

to stay in business (tax payers)

• New business model

Turn around

2004: 192 millions

• New price model

– dynamic pricing

• 40 new trains are ordered (X40)

2005: 1,2 billions

• Dynamic pricing in both

2 Class and 1 Class

2006: 368 millions

2007: 507 millions

• Internet auctions

2008: 543 millions

• 20 new fast trains are ordered (2 billions SEK)

2009: 460 millions

2010: 294 millions

2011: 38 millions

2012: 498 millions

2004-2012: 4,1 billions

Consolidation

Parameters of success

Institutions of limited liability companies

– means operations on sound economic grounds

Dynamic pricing

Environmental thinking becomes share of mind

Inter city-operations is easy travelling

Modern segmentation of customers

Regional clusters of comuting

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Time to departure, 3 months

Excess supply

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Dynamic pricing

Dynamic pricing

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Time to departure, 3 months

Dynamic pricing

Price index train tariffs Inflation

1985-1995 101% 66%

1995-2005 48% 10%

2005-2010 4% 12%

Dynamic pricing

2005 – 2012

Price index

train tariffs

Inflation

2005 - index 0 0

2006 0 +1

2007 -6 +4

2008 -7 +7

2009 -4 +7

2010 +1 +8

2011 +4 +11

2012 +4 +12

Markets

Malmö-Sto Train Air

2001 23% 77%

2011 30% 70%

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Gtb-Sto Train Air

2001 49% 51%

2011 69% 31%

Sundsvall-Sto Train Air

2001 30% 70%

2011 66% 34%

Karlstad-Sto Train Air

2001 66% 34%

2011 90% 10%

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Train vs. flight market

Source: KTH Järnvägsgruppen, Centrum för forskning och utbildning i järnvägsteknik

3h!

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Deregulation in three steps Timetable

1. July 2009 – opening of weekend traffic

2. October 2009 – opening of international traffic (cabotage)

3. October 2010 – opening of all markets, general access

The free market argument

Beneficial for passengers

Triggers development and increases efficiency

Also domestic markets should be opened

Abolish monopolies, avoid concessions/restrictions

BLS-visit 2009-07-09 19

Facing full-fledged deregulation

Customer satisfaction Improved quality of service

Employee contribution Increased participation

Sustained profitability Improved productivity

Expansion New markets

Challenges

SJs journey of change

… to SJ specifics

… to SJ is good for

… to SJ & sustainability

From TRAIN generics…

From TRAIN is good for…

From TRAIN & sustainability

… to serving people From operating TRAINs

… to dialogue From information

The rolling stock ahead

38 SJ 2000

40 Double deckers

100 RC-locomotives

350 wagons

SJ 3000 is our latest new train

• 25-40% is recycled – vehicle can be recycled to 98%

• Sorting stations in each car

• Uses 10% less energy compared to SJ 2000

• Regenerative brakes enables - 12% energy recovery

245 seats

Total of 4500 seats

Availability

SJ 2000 Upgrade Technology

An SJ analysis suggested the possibility, from a technical

perspective, of a life extension of X2000 for the coming 15-20 years

27 2013-04-18

SJ 2000 Upgrade

General project instructions:

• The X2 fleet strategy is to keep the trains in service until at least 2035

with high levels of comfort, service and reliability

• The intention is to maintain the position of SJ 2000 as our premium train

service and furthermore enhance their high profile

Long-term flexibility:

• The train sets must, after the refurbishment, be flexible to adapt to future

requirements and changes

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The refurbished X2 fleet shall improve the general image of SJ,

e.g. in the direction of higher reliability and quality of service

SJ2000 Actions Two projects; Upgrade och Interior

Refurbishment

Upgrade

29 2013-04-18

Interior Refurbishment

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Very High Speed – next step?

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B. Westerberg,

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Objective for SJ High Speed Trains 250 Km/h on existing tracks

Change the way to travel!

– A new concept that drives travel

– Compare the introduction of the X2000

Starting requirements

– Vehicles on the existing infrastructure

– Standard rolling stock, 250 km / h and tilting

– Sweden, Norway, Denmark and Germany

– Profitable business case

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Stockholm-Göteborg

T11 X2: 2:45

Stockholm

Stockholm-Malmö

T11 X2: 4:04

Sundsvall

T11 X2 3:10

Umeå

T11 X55 6:30

Best travel by

direct train

today and with

the X250

0:00

Göteborg-Malmö

T11 X31: 2:30

2:45

3:00

4:40

5:40

2:30

2:45

3:35

4:00

2:00

2:10

4:40

5:40

Journey with X2/X55

Rounded to the even number

of minutes Including normal

additions

Assumption: the infrastructure is adapted to

250 mph in the relevant section of the lines

33 Dokumentnamn SJ 2004-04-19 33

SJ main criterias for new rolling stock

Reliable Few errors / delays and cancelled train

Proven solutions to standard vehicle platform

Winter-assured solutions Reliable

Operation: Medium Sized Train => Usability & many seats

Geography: Scandinavia and Germany

Over time: Service Concept & interior design, secondary market Flexibility

Premium Product

Change the way to travel!

Design, service & comfort Image

250km / h speeds important for travel time => tilt

Good performance to make up for delays

Design for short station stop Reduces the risk of delay Short travel time

Standard solutions, production & delivery of quality

Approved vehicle platform (for EU countries) => lower risk Fast delivery

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Need for an upgraded infrastructure Technical issues for 250 km / h

Rail track technology

• Cant deficiency

• Rails, switches, track forces

• Buoyancy in the embankment

• Track Geometry, line optimization

• Track Location

• Line Conversion

• Bridges

• Catenary

• Level crossings

• Signalling system

• Bypass Track

Traffic Issues

• Tilting

• Station Passages

• Noise

• Passing clearance between trains

• Winter Properties

• Capacity

Thank you elisabeth.lindgren@sj.se