Richard Lutz

New Deutsche Bahn Chief Named

  • Why it matters

    Why it matters

    Deutsche Bahn’s expected new chief executive Richard Lutz has to sort out the struggling train operator’s finances.

  • Facts

    Facts

    • Deutsche Bahn chief Rüdiger Grube unexpectedly resigned his post as chief executive in late January after he learned that his contract would only be renewed by two years.
    • The railway operator posted a €1.3 billion loss in 2015 and agreed to a state capital injection.
    • The supervisory board is expected to confirm Mr. Lutz as chief executive at its meeting next week.
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    Audio

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Deutsche Bahn's Chief Financial Officer Richard Lutz. Source: Reuters

After weeks of political wrangling, the search is over. Germany’s governing coalition has settled on a candidate to lead Europe’s largest railway operator.

Deutsche Bahn’s current chief financial officer, Richard Lutz, has been tapped to take over the reins at Germany’s state-owned railway operator, according to information obtained by Handelsblatt.

Mr. Lutz has the right expertise and is currently the best candidate for the job, sources told Handelsblatt. He has a deep knowledge of Deutsche Bahn, is the right age and can provide a future perspective, the sources said.

“He is definitely not a transition candidate,” a source told Handelsblatt. The supervisory board is expected to confirm Mr. Lutz as chief executive at its meeting next week.

In another development, Deutsche Bahn is also making changes to its executive board, business magazine WirtschaftsWoche, a sister publication of handelsblatt, has learned. Two new posts will be created, in the areas of digitalization and technology, and a new member is being sought to handle the cargo brief. Announcements on appointments are also likely to be made at next week’s meeting.

Chancellor Angela Merkel’s former chief of staff, Ronald Pofalla, was originally floated as successor to Mr. Grube, but the government decided against a political candidate.

Deutsche Bahn was thrown into turmoil in late January when Rüdiger Grube unexpectedly resigned his post as chief executive after he learned that his contract would only be renewed by two years.

Mr. Grube faced mounting criticism for his leadership due to Deutsche Bahn’s ongoing financial woes. The railway operator posted a €1.3 billion ($1.39 billion) loss in 2015 and agreed to a state capital injection.

The federal government plays a key role in appointing the railway operator’s chief executive. Chancellor Angela Merkel’s former chief of staff Ronald Pofalla was originally floated as a successor to Mr. Grube, but the government decided against a political candidate, sources told Handelsblatt.

According to information obtained by Handelsblatt, additional changes to Deutsche Bahn’s executive board are under consideration. The transportation ministry is pushing for the railway’s freight and digital units to have representation on the executive board, sources said.

“The objectively meaningful areas will be strengthened,” sources in the coalition government told Handelsblatt.

The future of the current board members is not in jeopardy, the sources said. Instead, the talk is about staffing additional seats on the recommendation of the current members.

There’s also discussion of finding a new engineering and personnel executives, the sources said.

And despite speculation to the contrary, Chairman Utz-Hellmuth Felcht will keep his position as head of the non-executive supervisory board, according to information obtained by Handelsblatt.

Mr. Felcht had received blame for mishandling Mr. Grube’s contract extension, resulting in the chief executive’s abrupt resignation. The non-executive supervisory board hires and fires chief executives and weighs in on corporate strategy.

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