New rail operators have a tough time breaking into the market, but it’s much better for customers when they succeed.

In general, competition is a good thing for transport modes, acting as a spur for service improvements and pricing. Unfortunately, despite the best efforts of the EU, in mainland Europe the state incumbents continue to resist new market entrants. In previous columns I have detailed the issues faced by night train operators in their bid to introduce new services, and not a single operator has yet launched a service aimed at business users.

The same situation is true for new daytime entrants. Two routes where competition is sorely needed include Eurostar’s service between London and Paris and the core Amsterdam-Brussels-Paris line operated by Thalys. The lack of competition to Eurostar has been reported many times previously so I shall not repeat. But Thalys (which will soon merge with Eurostar) badly needs a high-speed (HS) rival. No new trains have been acquired since the 1990s, even though the market has grown a lot since then, and the lack of capacity spells higher fares.

Hold the line

Where France’s SNCF has seen competition (albeit only on one route at the time of writing) the benefits are clear. Italy’s Trenitalia entered the Paris-Lyon-Milan route last December, after waiting two years for approval by France’s rail regulator, and capacity has since increased, leading to better value fares and a better product both for Paris-Lyon and Paris-Milan.

The next route where SNCF is expected to face competition is Paris-Barcelona. When this route finally became HS throughout its length it was hailed as a route that would divert traffic from air to rail. But it never happened. Until December SNCF and Spain’s Renfe operated the route on a JV (joint venture) basis. It meant these two provided a single train for much of the year which hardly encouraged travellers to switch from air. Now that the JV has ended, SNCF has decided to upgrade to double-daily services, and increase this further to three trains a day from summer 2023. Renfe’s riposte is awaited.

France has one of the most restrictive markets for rail, where newcomers are discouraged. According to All Rail, a body that represents new rail entrants, “France has one of Europe’s highest track access charges. These are too expensive for new [private] entrants. In addition there is a lack of access to second-hand rolling stock, and for new entrants, brand new is too expensive.”

Indeed SNCF has been scrapping its older TGVs along with some of the original Eurostar stock. Critics say that some of this rolling stock ought to have been made available to a new entrant. Hence France’s Le Train, which had hoped to acquire some of SNCF’s older TGVs, has had to abandon its plans.

In contrast to France, travellers find the most competitive HS market on domestic routes in Italy and Spain. Italy started the HS ball rolling by allowing private firm Italo to compete with Trenitalia. Italo website’s homepage is more like that of an airline rather than a train firm. Its HS trains run from North to South, and have prompted Trenitalia to pull up its socks.

On the right track

Spain is even more interesting. To better utilise its HS network, Spain invited foreign operators to serve the network. Two operators, namely SNCF and Trenitalia, seized the opportunity. Initially both operators served the voluminous Madrid-Barcelona route but now they are starting to cover additional cities. Consequently, fares with all operators have fallen and consumers have benefitted. Renfe, whose previous HS services were efficient but somewhat pricey, responded with its own budget HS train branded Avlo.

Trainline has also been a beneficiary of this competition. Unlike the UK, where all train operators must display all other firms, the situation in mainland Europe is akin to the early days of airline computer booking systems. In other words, operators in mainland Europe are allowed to display their services only. It has meant travellers have flocked to independent sites for the full range of options. So while UK rail has still not fully recovered following the pandemic, Trainline’s international sales (mainly in France, Italy and Spain) have grown by 81 per cent.