Russian Railways

Russian Railways, commonly abbreviated RZD or RZhD, is the fully state-owned railway company of the Russian Federation. It manages much of Russia’s national rail infrastructure and provides freight, long-distance passenger, suburban, locomotive, logistics and related transport services. The company is one of the country’s largest employers and infrastructure operators and has a dominant position in long-distance passenger rail and network freight transportation. RZD was created during the restructuring of Russia’s railway sector in 2003. The reform separated commercial and operating functions from the former Ministry of Railways of the Russian Federation, the post-Soviet successor to the Soviet Ministry of Railways. Russian Railways received the majority of the former ministry’s assets and was established as a joint-stock company whose sole shareholder is the Russian state. The government exercises shareholder powers, appoints the company’s president and approves its board and annual reporting. The company’s business is vertically integrated. Its responsibilities include infrastructure maintenance and development, train dispatching, traction, rolling-stock services, freight transportation, long-distance passenger services and participation in logistics ventures. RZD’s freight role is particularly important because rail carries a substantial share of Russia’s non-pipeline cargo, including coal, metals, oil products, timber, grain, containers and industrial materials. Passenger operations include conventional overnight trains, branded services, high-speed trains and suburban services delivered through subsidiaries and regional operating arrangements. The company’s most recognizable transport assets are associated with Russia’s extensive rail geography, including the Trans-Siberian Railway and the Baikal–Amur Mainline. RZD has also developed branded high-speed services, notably Sapsan trains on the Moscow–Saint Petersburg corridor, and has participated in the creation of the Moscow Central Circle. Its network and service portfolio connect major Russian cities, ports, industrial regions and border crossings, while international subsidiaries and partnerships have undertaken railway construction, electrification and logistics projects abroad. During the 2000s and 2010s, RZD pursued structural reform, modernization and partial market liberalization. Freight rolling-stock ownership and operations were opened to private companies, while some subsidiaries were sold or reorganized. The company invested in infrastructure upgrades, new locomotives and passenger trains, preparation for the Sochi Olympic Games, expansion of the Baikal–Amur route and high-speed rail planning. It also acquired a controlling interest in French logistics group Gefco before that investment was sold in 2022. RZD’s position has been affected by political, regulatory and economic developments. The company was sanctioned by the United States after Russia’s 2022 invasion of Ukraine, and international projects and partnerships were disrupted. The Karelian Trains joint venture with Finland’s VR Group ceased operations after cross-border passenger services stopped in 2022. RZD remains central to Russia’s domestic transport system, but its freight volumes, investment plans and international activities are exposed to sanctions, industrial demand, export-route changes, financing constraints and competition from road, air and maritime transport.

Russian Railways emerged from the post-Soviet reorganization of Russia’s railway administration. After the dissolution of the Soviet Union, Russia inherited most of the railway network located within its territory. The former Ministry of Railways continued to combine governmental regulation with commercial and operational functions, but declining profitability, administrative complexity and the need to modernize the network encouraged reform. In 2003, legislation and a presidential-government restructuring program separated policy and regulatory functions from railway operations. Russian Railways was created as a joint-stock company on 18 September 2003 and began operating during the same year. The new company received more than 95% of the former ministry’s assets, including infrastructure, rolling stock and numerous affiliated enterprises. Gennady Fadeyev, previously minister of railways, became its first president. Although reform introduced the possibility of third-party access and private freight operators, the company retained a dominant position because it controlled the network and had obligations to provide nationwide service. The first decade was marked by corporatization, subsidiary formation and partial liberalization. Rolling-stock operations were reorganized, with Freight One and Freight Two created as major freight subsidiaries; Freight Two later became Federal Freight. Private wagon owners and logistics companies gained a larger role in freight transportation. Russian Railways also created Federal Passenger Company in 2010 to manage most long-distance passenger services. In parallel, the company pursued modernization of locomotives, passenger cars, signaling, electrification and major corridors. Infrastructure projects included the conversion of the Sakhalin railway from its former narrow gauge to the Russian broad gauge, improvements to the Baikal–Amur Mainline, and investment associated with the 2014 Sochi Olympic Games. The company entered high-speed rail through Siemens cooperation and introduced Sapsan services. A new corporate identity launched in 2007 and was refined through 2010, presenting Russian Railways as a modern transport holding rather than only a legacy state ministry. RZD expanded into logistics and international railway engineering. It acquired 75% of Gefco in 2012, while RZD International won or participated in railway electrification and reconstruction projects in Iran and Serbia. The Moscow Central Circle opened in 2016, adding a major urban rail service to the company’s portfolio. Long-term planning included high-speed corridors linking Moscow with Kazan, Yekaterinburg, the southern regions and Saint Petersburg, although the timing and scope of proposed projects depended on state financing and changing economic conditions. Leadership changed in 2015 when Oleg Belozyorov succeeded Vladimir Yakunin. The company continued to operate as a state-controlled vertically integrated holding while facing debate over tariffs, procurement, labor reductions, private freight competition and infrastructure investment. Investigations in the early 2010s alleged irregularities in some procurement and real-estate transactions; these allegations became part of public scrutiny of the company’s governance. The 2020s brought substantial disruption. Russia’s invasion of Ukraine led to sanctions, the suspension or termination of several international relationships and the sale of the Gefco stake. Cross-border passenger operations with Finland were halted, and the Karelian Trains joint venture later ended. International financing and payment problems also affected entities connected with Russian Railways. Domestically, the company remained essential for bulk freight and long-distance passenger mobility, while changes in industrial production, export geography, sanctions and demand placed pressure on capacity planning and investment. Railways serving Russian-occupied Ukrainian territories are operated by separate entities rather than being treated here as Russian Railways operations.

1. 2022International operations are disrupted by sanctions

   Sanctions and the invasion of Ukraine affect financing, partnerships, cross-border services and overseas holdings.

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2. 2019Sakhalin gauge conversion completed

   The long-running project to convert the Sakhalin railway to the gauge used across mainland Russia is formally completed.

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3. 2016Moscow Central Circle opens

   The new orbital urban railway begins service in Moscow.

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4. 2013Baikal–Amur modernization begins

   A major capacity and infrastructure modernization program is launched on the Baikal–Amur Mainline.

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5. 2010Federal Passenger Company is created

   The wholly owned passenger subsidiary begins taking responsibility for long-distance services.

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6. 2008Strategy 2030 approved

   A long-term government-backed investment and modernization strategy is adopted for the railway network.

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7. 2007Corporate identity redesign

   RZD introduces a new logo and visual identity as part of a multi-year corporate branding program.

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8. 2006Siemens high-speed train agreement

   Russian Railways signs an agreement with Siemens for the delivery of eight high-speed trains, laying groundwork for the Sapsan program.

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9. 2003Russian Railways is founded

   The Russian government establishes Russian Railways as a state-owned joint-stock company during the separation of railway operations from the Ministry of Railways.

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State-owned national rail infrastructure and transport monopoly with an integrated freight, passenger and logistics portfolio.

• Freight rail transportationRail freight2003

  RZD transports bulk and general freight across Russia, including coal, metals, petroleum products, timber, grain, containers and industrial goods. The business combines access to the national infrastructure with locomotive, dispatching and terminal services. Private wagon owners and independent freight operators also participate in the market, while RZD remains the central network and service provider.

• Long-distance passenger trainsPassenger rail2010

  Long-distance services include overnight sleeper trains, seated intercity trains and international routes historically operated through Russian Railways subsidiaries. Federal Passenger Company manages most conventional long-distance operations. The product is designed for Russia’s large distances and includes multiple accommodation classes, with third-class sleeper cars serving a substantial share of travelers.

• SapsanHigh-speed passenger rail2009

  Sapsan is the branded high-speed service operated principally on the Moscow–Saint Petersburg route. It uses Siemens-derived train technology and offers a faster alternative to conventional overnight and daytime trains. The service represents RZD’s most prominent high-speed passenger product and forms an exception to the broader long-distance operations managed through Federal Passenger Company.

• Trans-Siberian Railway servicesLong-distance rail corridor2003

  The Trans-Siberian Railway is the best-known corridor associated with Russian Railways. It connects European Russia with Siberia and the Far East and supports both passenger journeys and freight flows. RZD operates services and manages infrastructure along relevant portions of the route, which functions as a strategic domestic and international transport axis.

• Moscow Central CircleUrban rail2016

  The Moscow Central Circle is an orbital railway service designed to improve cross-city connectivity and interchange with Moscow’s metro and suburban rail systems. It opened in 2016 after design and management work involving Russian Railways-related organizations. The line converted a historically freight-oriented orbital route into a significant urban passenger asset.

• Railway infrastructure servicesInfrastructure management2003

  RZD manages and maintains track, stations, signaling, electrification, dispatching and other core railway infrastructure. These activities support both the company’s own trains and access by other carriers and operators. Infrastructure investment is directed toward capacity, safety, network resilience, high-speed corridors and strategic freight routes.

• 2014Sochi Olympic transport preparation

  Russia

  RZD directed substantial investment toward railway infrastructure, rolling stock and transport capacity connected with preparation for the Sochi Winter Olympics.

  Outcome. The program supported event logistics and left upgraded railway assets in the Sochi region.

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• 2007Corporate identity modernization

  Russia · International corporate communications

  Russian Railways introduced a new logo, typography and visual system, presenting the company as a modern integrated transport holding after its separation from the former ministry.

  Outcome. The identity was refined through 2010 and became the company’s principal public-facing brand system.

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• 2022Respond to sanctions and international disruptionOther

  Russia’s invasion of Ukraine resulted in sanctions against Russian Railways and severe disruption to cross-border transport, financing and international partnerships.

  What changed. RZD continued domestic operations while international assets, joint ventures and payment arrangements were restructured or suspended.

  Aftermath. The Gefco investment was sold, Karelian Trains ceased, and RZD’s access to international finance and markets became more constrained.

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• 2015Replace the company presidentOther

  Vladimir Yakunin’s tenure had attracted criticism over management and procurement issues, although the reported reasons for his departure varied.

  What changed. Oleg Belozyorov was appointed president of Russian Railways in place of Yakunin.

  Aftermath. The company continued its modernization and restructuring agenda under new leadership.

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• 2012Acquire a controlling stake in GefcoM&A

  RZD sought to expand its international logistics and supply-chain activities beyond domestic rail transportation.

  What changed. The company purchased 75% of French logistics group Gefco from PSA Peugeot Citroën for a reported €800 million.

  Aftermath. Gefco became an important international logistics asset until its sale was agreed in 2022 amid geopolitical and sanctions-related disruption.

  Transaction value. €800 million (2012)

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• 2010Separate long-distance passenger operationsStrategy

  Railway reform sought to separate infrastructure, passenger and freight activities within the wider holding.

  What changed. Russian Railways established Federal Passenger Company as a wholly owned subsidiary for most long-distance passenger services.

  Aftermath. Passenger operations were given a dedicated corporate platform while RZD retained group control.

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• 2003Create a state-owned railway holdingStrategy

  The former ministry combined regulatory, infrastructure and commercial functions, while railway profitability and administrative efficiency were under pressure.

  What changed. The government created Russian Railways as a joint-stock company and transferred most ministry assets to it while separating regulatory responsibilities.

  Aftermath. RZD became the dominant vertically integrated operator, with formal scope for third-party infrastructure access and private freight competition.

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• 2012Procurement and related-party allegationsControversy

  A Reuters investigation questioned the competitiveness of some Russian Railways procurement awards and reported that certain contractors appeared to have little operational substance. The reporting also described alleged connections between contractors, company leadership and related real-estate transactions. These were allegations reported by the source and are not presented as a judicial finding here.

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• 2023Karelian Trains joint venture ends

  The joint venture between Russian Railways and Finland’s VR Group ceased after cross-border services had been suspended in 2022.

  M&AOther
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• 2023Russian Railways marks twenty years as a joint-stock company

  The company marked two decades since its establishment and highlighted infrastructure, passenger, freight and high-speed rail development during that period.

  Other
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• 2022Russian Railways faces sanctions after the invasion of Ukraine

  The United States imposed economic sanctions on Russian Railways following Russia’s invasion of Ukraine.

  Regulation
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• 2022Gefco is sold amid sanctions and geopolitical disruption

  CMA CGM announced an agreement to acquire Gefco from Russian Railways and Stellantis.

  M&ARegulation
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• 2022RZD Capital linked notes trigger a reported failure-to-pay credit event

  International derivatives-market bodies determined that a failure-to-pay event had occurred in relation to Swiss-franc notes linked to RZD Capital.

  RegulationOther
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• 2020Russian Railways adopts a new advertising partner

  Russian Railways selected a new contractor for advertising across stations, trains and other infrastructure after mutually ending its earlier advertising agreement ahead of schedule.

  Campaign
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• 2016Moscow Central Circle opens

  The metropolitan rail ring began passenger service as a major urban transport project involving Russian Railways and its subsidiaries.

  Product launch
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• 2015Vladimir Yakunin leaves the presidency

  Yakunin was replaced by Oleg Belozyorov as president of Russian Railways.

  Leadership change
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• 2012Russian Railways acquires a majority stake in Gefco

  The company agreed to purchase 75% of French logistics group Gefco from PSA Peugeot Citroën.

  M&A
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• 2011Freight One stake is sold to Independent Transport Company

  Russian Railways sold a controlling stake in its Freight One subsidiary, transferring control to an external rolling-stock operator.

  M&A
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• 2010Federal Passenger Company begins operations

  A wholly owned subsidiary was established to manage most long-distance passenger services.

  Other
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• 2009Sapsan high-speed service begins between Moscow and Saint Petersburg

  High-speed Sapsan passenger services began on the Moscow–Saint Petersburg route, becoming one of the company's most visible modernization initiatives.

  Product launchProduct generation
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• 2008Russian government approves Strategy 2030

  The long-term plan emphasized network modernization, capacity expansion and infrastructure investment.

  Other
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• 2007Russian Railways adopts a new corporate identity

  The company introduced a redesigned visual identity and associated corporate typography during a broader branding program.

  CampaignOther
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• 2003Russian Railways is established as a state-owned joint-stock company

  A railway-sector reform transferred most of the former Ministry of Railways’ assets to the newly created company.

  Other
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• 2003Russian Railways created during railway-sector reform

  The Russian government established Russian Railways as a joint-stock company to assume the commercial and operating functions previously held within the Ministry of Railways.

  Other
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1. Russian Railways
2. Official Russian Railways website
3. Russian Railways sanctions information
4. Reuters coverage of Russian Railways
5. Russian Railways marks twenty years as a joint-stock company
6. Russian Railways adopts a new advertising partner