OBSERVERS of long-distance international passenger travel by train across Europe may well have concluded that the future outlook is pretty bleak. Their pessimism was confirmed at the EuroRail 2005 conference on January 26-27 in Berlin, where a panel discussion found that such services were likely to survive only in a few niche markets with high demand.
The debate had the challenging title of ’Fighting the low-cost airlines - is there a future for international rail travel?’ The scene had been set in a preceding presentation by Mireille Faugère, Director, Passenger, France-Europe, at SNCF, who drew attention to the consequences of easyJet launching services between Paris and Marseille. This had forced Air France to slash its fares on the same route, at which point SNCF ’had to react’. Competition was ’very huge’, and ’our customers are very clever now - they can compare the whole offer on the internet’, she said. This was one reason for the launch in December of iDTGV (p142), which Faugère said had been very successful.
Trenitalia’s TrenOK (RG 1.05 p13) offering a lowest fare of €9 between Roma and Milano followed similar principles and achieved an instant response. According to Enrico Trapazzo, Director, International, at Trenitalia’s Passenger Division, TrenOK also attracted huge publicity as a welcome spin-off benefit. Trenitalia had been assailed by low-cost airlines seeking a slice of its long-distance overnight domestic traffic, and it had fought back with an aggressive policy (RG 5.04 p271), recovering the lost volume.
Trapazzo’s view was that relatively few markets with journey times over 3h 30min would survive the onslaught from low-cost airlines. One market with strong potential, he believed, was between Roma and Paris.
Conceding that the number of overnight trains between Italy and France had been cut from four to two last year, he said that an extra day service had been added and the number of coaches on the remaining night trains increased. Highlighting the strength of demand, Trapazzo reported that even midweek during the winter the trains were full: ’there were 350 people on the Roma - Paris train last Tuesday night’. Asked why the number of night trains had been cut, Trapazzo drew attention to the ’discovery of the real costs’ with duplicate charges incurred in both countries.
This highlighted the need to drive down costs through internet ticketing. As one speaker pointed out, it can take 30min to provide a reservation and ticket for an international journey, by which time any profit from the transaction has vanished before the ticket is even sold.
Haydn Abbott, Managing Director of Angel Trains, pointed out that international services involved ’immensely complex technical issues’ that required the European railways ’to co-operate in the face of competition’. Unfortunately, too many were ’like children in a playground, each with their own ball’, who refused to play with each other.
In the leisure market the competition is not necessarily between modes over the same route. Managing Director of Thalys International Jean-Michel Dancoisne warned the conference of what he called ’destination competition’. In the Thalys market this takes the form of German customers spending a weekend in Praha or Budapest rather than travelling by Thalys to Paris.
