KiwiRail has announced it plans to axe 181 jobs over the next three years, as it works to trim its budget.
The company's infrastructure and engineering staff will be told when and where the cuts will come at meetings throughout the country this week.
The state-owned enterprise says it will be spending $200 million less on its network over the next three years, because of economic uncertainty and the Christchurch earthquakes.
Jobs will be lost among maintenance staff who repair and renew the tracks, sleepers, signalling and bridges.
The company says it still intends to invest $750 million, but says fewer staff will be needed because less work will be done. It is hoping many of the job losses will take the form of voluntary redundancy.
Chief executive Jim Quinn says he's certain rail users will not be affected and safety will not be compromised.
New loco stripped for parts
It has also been revealed that one of KiwiRail's Chinese locomotives has been stripped to keep others in the new $75 million fleet of 20 going.
The train, worth more than $3 million, sat for more than six months at the Te Rapa railyards before re-entering service a week ago.
While it was idle, KiwiRail harvested parts from it to keep other Chinese locomotives going.
Mr Quinn says it is not unusual when commissioning a new fleet of locomotives to use one as the maintenance spare.
He says this particular locomotive was out of service with a vibration problem, and "we took parts off it because it was parked up, and used them; but it wasn't parked up to be used as parts - that wasn't the reason for it, it was an opportunity".
'Derelict and forgotten'
Rail and Maritime Transport Union general secretary Wayne Butson says the situation is unacceptable.
"This thing arrives in New Zealand," he says, "gets parked up and is just cannibalised to keep other locomotives in the class operational. It's had its traction motors arrived, it's had all sorts of other equipment removed, and so it's just sitting there derelict and forgotten.
"This is three and a half million dollars of taxpayer money."
Mr Butson says it's time someone was held to account at KiwiRail for shoddy Chinese-made trains and wagons.