Not long ago, if you boarded a train from Munich heading to the eastern border of Austria, whether the train could avoid colliding with other locomotives depended partly on a signal station built in 1899, when Kaiser Wilhelm II still ruled Germany.

The signal station was roughly the size of a small house, where operators manipulated heavy levers and turned cranks connected by cables to switches and signals, preventing the dangerous scenario of two trains entering the same track.

Deutsche Bahn finally replaced this 126-year-old facility in Mühldorf am Inn with an electronic system at the end of last year.

However, this also highlights the enormous gap between Germany's aging railway infrastructure and increasingly intelligent trains: nearly one-fifth of the state-owned railway company's interlocking devices are still mechanical.

Michael Peter, CEO of Siemens Mobility, stated that bridging this gap could significantly boost capacity without building new tracks.

In an interview with Bloomberg, he said that digital signaling systems and autonomous driving technology could increase the number of trains the existing network can accommodate by approximately 30% by shortening train intervals and adjusting operations during delays.

"This is the core of today's debate in Germany: how to increase the capacity of existing lines, re-establish buffer space, and operate more punctually. The key lies in punctuality, and achieving punctuality requires a complete end-to-end set of technologies," he said.

Trains themselves are increasingly resembling mobile computers.

Peter stated that the flagship Intercity Express (ICE) trains are equipped with approximately 1,000 sensors, generating about 1 billion data points daily.

The fleet managed by Siemens Mobility travels a total of approximately 1 million kilometers (equivalent to 621,370 miles) per day, roughly equivalent to three round trips to the moon, with software continuously monitoring vehicle conditions and identifying anomalies before equipment failures occur.

Other technological achievements of the company include remote locomotive startup, trains capable of automatically departing from depots to their first station, and autonomous braking upon detecting obstacles.

Such technologies are expected to improve network throughput.

Deutsche Bahn has long suffered from congestion and delays, earning a poor reputation.

According to Deutsche Bahn data, only slightly more than half of long-distance trains in September arrived within 6 minutes of their scheduled time, with an average of 6,831 infrastructure-related delays occurring daily last year.

In comparison, high-speed rail networks in France, Spain, Italy, as well as European countries like Austria and Switzerland, are renowned worldwide for their efficient and reliable operations.

The challenge Germany faces is that smart trains still have to operate on infrastructure built incrementally over a century.

The entire network has approximately 100 different types of interlocking systems, making maintenance complex and making it difficult to implement unified digital standards.

Dirk Flege, Managing Director of the Rail Promotion Alliance, stated: "There is too much fragmentation in the field of railway digitization, insufficient standardization, and a severe lack of standardized interfaces."

The technology to upgrade infrastructure is already mature.

The new generation of signaling technology can migrate safety logic originally distributed across various local devices to standardized processors within data centers.

Trackside equipment can be retained, but software centrally determines whether routes are safe and issues commands to switches and signals.

Another core element of digital railways is the European Train Control System (ETCS), which uniformly replaces existing national signaling systems, informing locomotives of permissible travel distances and speeds.

As a companion technology to the European Railway Traffic Management System, automatic train operation systems can control train acceleration, coasting, and braking.

Artificial intelligence will ultimately be able to simultaneously schedule large numbers of trains: slowing down when tracks ahead are occupied, prioritizing clearance after delays, and replanning traffic flows to return the network to schedule.

Germany's digital transformation has only just begun.

As of the end of 2025, only 683 kilometers of the over 33,000-kilometer railway network were equipped with ETCS.

By comparison, Switzerland has deployed this system across its entire national network since 2018.

Austria signed a framework contract worth 2.6 billion euros (equivalent to 2.9 billion US dollars) last month for nationwide signaling system modernization, with approximately 1.3 billion euros going to Siemens Mobility, a subsidiary of the Munich-based industrial giant Siemens.

Deutsche Bahn withdrew its previous ETCS retrofit plan in the summer of 2025, citing the industry's inability to complete train retrofits within the planned timeframe and uncertainty regarding federal infrastructure funding.

Since then, more than 10 billion euros of the 500 billion euro government infrastructure fund has been allocated for railway digitalization upgrades.

The retrofit work also requires simultaneous upgrades to both trains and tracks, which is no small challenge.

Some older mechanical and relay systems are still being replaced with traditional electronic interlocking devices rather than new-generation equipment designed for networked unified systems.

German Finance Minister Lars Klingbeil stated that the impact of delayed railway system upgrades extends beyond punctuality issues.

"Train delays are no longer just an investment problem," said Klingbeil, who also serves as co-leader of the Social Democratic Party, last year. "This has become a real challenge for German democracy, as people are beginning to lose faith that Germany's systems can function properly."