Economy

SNCF in the battle for rail competition in Spain

To go from the SNCF sandwich to the Spanish tortilla, it takes about six hours and thirty-five minutes: the time to travel the 1,000 kilometers separating Paris and Barcelona by rail. From this Sunday, December 11, the French incumbent operator is launching its own TGV InOui line between the two cities. For the moment, two daily connections will be provided in both directions, then a third is planned for the summer of 2023.

This announcement may, however, seem incongruous to many travelers. Yesterday again, December 10, high-speed trains did indeed travel between Paris and the capital of Catalonia. The difference ? These trains had been operating within a commercial alliance called Elipsos, an equal subsidiary of SNCF and its Spanish counterpart, Renfe, for ten years. The two operators have decided to break this partnership. “We ensure a kind of continuity of service”, we say to the SNCF which now rides the solitary rail on this section.

Note, however, that this famous continuity of service only concerns the Paris-Barcelona link. Elipsos also provided trains between Lyon and the Catalan capital and between Marseille and Madrid, but the SNCF decided not to take them over, in particular because they are not profitable. And we do not know if Renfe, for its part, will take them back on its side as some hope.

Termination due to competition

“Renfe is a relatively small railway company, points out Arnaud Aymé, transport specialist at Sia Partners. With its 30,000 employees, its workforce is half that of the SNCF branch alone, which operates passenger trains. »

In other words, the Spanish company does not have the power to run all the hares, or rather all the TGVs, at the same time and must concentrate on priorities. “Renfe has expressed for several years its desire to come and compete with the SNCF with TGVs on the lines in the south of France, but also to launch lines to Great Britain against Eurostar, a subsidiary of the French company, adds Arnaud Aymé. And nothing materialized. It would be surprising if Renfe chose to make these old Elipsos lines a priority, the profitability of which would be much lower. »

Why did the two former partners decide to break their rail pact after so many years? The answer can be summed up in one word: competition! In the spring of 2021, the SNCF went to tickle the axles of Renfe by launching the first Spanish Ouigo line, these low-cost high-speed blue trains, between Madrid and Barcelona. For its part, Renfe has made no secret of its aims to conquer a share of the high-speed cake on the French network.

The culture of long-distance coaches

In Spain, the French Ouigo enjoyed phenomenal success. With five daily round trips between the two major Spanish cities, the trains experience average occupancy rates of over 97%, with even peaks of 99% and 100% during holiday periods… A success such as the SNCF has just open a new line between Valencia and Madrid!

How can the SNCF reduce its energy consumption?

Why this triumph of Ouigo? It should be remembered that the Spanish high-speed network is the largest in Europe… but that France carries more than 100 million passengers on its network, ie three times more than the Renfe lines. “While long-distance coaches have only been allowed in France again since 2015, they are part of the travel culture in Spain, notes Arnaud Aymé. The high-speed trains were aimed more at business customers and their prices were high. Hence the SNCF offer shock. »

The Spanish market is so promising that a third operator, Iryo, a consortium led by the Italian Trenitalia, has also just launched in November on the Madrid-Zaragoza-Barcelona axis. With services aimed more at business travellers. In this way, Spain becomes the European country which has attracted the most competitors on high-speed rail.

“The market is so promising that there is no real need to capture travelers from competitors but to attract new customers to the train”, notes Arnaud Aymé. The icing on the cake: rail tolls are much cheaper than in France…

Source : BBN WORLD NEWS

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