ROUTE-LEVEL PROFITABILITY ZONES IN RAILWAY PASSENGER TRANSPORT

Abstract

The study examines how aggregate network-level losses in railway passenger transport can conceal substantial
heterogeneity in route-level profitability. The research aims to classify individual routes and train types into break-even
zones using two threshold coefficients: one based solely on the carrier’s managed costs and the other incorporating both
managed costs and contractual infrastructure charges. The analysis demonstrates that route-level classification, rather
than network-wide averages, provides a more appropriate basis for tariff and investment decisions. Revenue and cost
indicators were calculated for seven long-distance routes and four train types using 2023 traffic data and 2025 cost and
tariff conditions. The results indicate that four of the seven routes generate revenues exceeding full costs and therefore
fall within the commercial zone. In contrast, three routes generate revenues several times higher than managed costs but
remain below the full-cost threshold, placing them in the potential-commercial zone. This outcome is primarily associated
with route length and the predominance of the lowest fare class rather than cost inefficiency. A comparison across train
types reveals that revenue per passenger ranges from near zero for suburban electric services to 201 thousand UZS for
conventional long-distance trains. These findings confirm that tariff structure, rather than unit cost, is the principal factor
underlying internal cross-subsidization within the railway passenger transport network