The head-on smash happened at the town of Bad Aibling, on the line between Holzkirchen and Rosenheim, about 60km out of Munich.
Eight have been confirmed killed and about 150 needed medical attention. Police said 55 of these were classified as either “serious” or “critical”
Emergency services are reportedly still trying to reach people trapped in the wreckage. Several carriages have overturned and other wedged together.
“This is the biggest accident we have had in years in this region and we have many emergency doctors, ambulances and helicopters on the scene,” Police spokesman Stefan Sonntag told The Associated Press. “We have a lot, a lot of staff on the ground who are all involved in the rescue efforts.”
“Several hundred” emergency services personnel are at the scene, police say, including eight air ambulances. Neighbouring Austria is also contributing to the rescue efforts.
Federal police spokesman Stefan Brandl says the stretch of line on which the two trains crashed is squeezed between the Mangfall river on one side and a forest on the other, which is making rescue operations very difficult.
Regional rail company Meridian said in a statement that “a tragic accident occurred on the single-track route between Rosenheim and Holzkirchen this morning shortly after 700am (0600 GMT)”.
The operator of the two trains that crashed, Bayerische Oberlandbahn, says on its website that the trains of the so-called Meridian line both partially derailed and are wedged into each other.
The statement did not address the cause of the crash, and officials decline to comment on it.
German news agency reported that the rail line is used by commuters going to Munich for work. Usually schoolchildren also take the trains, but they are currently on winter vacation.
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