Brussels, 26 January 2023: four days ago, on Sunday 22 January, we celebrated the 60th Anniversary of the treaty of friendship between France and Germany. Both countries are an integral part of the EU and the European single market. Therefore, it is rather odd that their two state-owned rail incumbents are marking this anniversary with a new joint high speed rail monopoly.

Incumbents SNCF and DB will introduce a new joint high-speed service between Paris and Berlin. According to Bloomberg, this is “in the name of green transition” .

Unfortunately, such a collusion will deliver the opposite, keeping the rail market small and limiting consumer choice. Bloomberg continues: “Environmentally conscious travellers are increasingly hungry for rail options”.

• Exactly – but they are looking for more than just one rail option(!)

Ironically, SNCF is the best example of what happens when there are two or more competing high speed rail options instead. After it started high-speed competition against the Spanish incumbent Renfe in the middle of the COVID-19 pandemic in 2021, SNCF itself has shown how – just four months after market entry – total passenger numbers had already grown by 17% versus the last year before the pandemic (2019).

Meanwhile, after the high-speed trains of SNCF and the Italian incumbent FS Trenitalia started competing with each other between Milan, Lyon and Paris in December 2021, the total number of rail passengers grew by 58% in just nine months (please see the two articles below).

Fact is: whenever high-speed state rail incumbents compete with each other, then the passenger numbers grow fastest of all. It is the new variety of fare & product options that attracts additional passengers to rail – this is what really enables any green transition.

Therefore, we ask: why are Europe’s largest operator (DB) and the 2nd largest (SNCF) still unable (or unwilling) to compete with each other? Or is there a secret ‘non-compete agreement’ between the two operators? It is all very worrying, especially considering that there Is no other high-speed carrier on the same route.

“If this probable cartel is allowed to happen, then in future any other two market dominant rail operators will be able to refer to it as ‘permission’ to collude across internal EU borders, even if there is no alternative operator for passengers. Effectively, the EU cross-border long distance passenger rail market will be dead. For the sake of the green transition, competition is clearly the answer instead.”

ALLRAIL Secretary General Nick Brooks

Annex
The article below appeared in September 2022 in the French economic publication Challenges. Here is a translation thereof:

Competition on the railways is accelerating
…Since the arrival of Trenitalia on the Paris-Lyon TGV line last December, the average ticket price has fallen by 7% from €45 to €42 and the number of tickets sold has increased by 58%, all operators combined.

More on the success of this new high-speed competition between Paris, Lyon and Milan was published just yesterday on rail observer Frédéric de Kemmeter’s website.