• Train delayed: Europe slowly injecting more competition on rail travel

    The European Parliament at the plenary session in Strasbourg today voted to start exposing Europe’s incumbent passenger rail companies to more competition but falls short of ensuring Europeans will get better, cheaper train trips in the near future. Sustainable transport group, Transport & Environment (T&E), thinks today’s vote is a small step in making rail more efficient and customer-focused so as to attract more people onto trains. 

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    Samuel Kenny, rail officer of T&E, said: “Passenger rail is energy-efficient and largely electric, and hence should play a bigger role in cutting ever-growing carbon emissions from transport. If we want Europe’s trains to be a better alternative to flying or driving a car, we need the sector to become more efficient and customer-focused. Today’s vote can be a small step towards that goal.”

    Historically, contracts have been awarded directly to incumbent, state-owned operators without competition from other operators that could potentially provide better, cheaper services. Today’s railway reform will make it the norm for Member States to tender their contracts for railway services as of 2023, opening up the market for competition. However, in a concession to incumbent monopolists, one final contract can be awarded directly to the incumbent for the period of 10 years before this deadline.

    In many member states, the manager of the rail infrastructure is owned by the same parent company as the train operator, discouraging new companies to enter the market. One achievement of today’s reform is that there will be more financial transparency and will make progress in separating accounts between the infrastructure managers and the rail operator. This essential prerequisite to competition makes the railway market more attractive to investors.

    Samuel Kenny said: “More players coming into the market can make rail travel more complicated. We need to ensure that booking and paying for rail travel throughout Europe becomes much easier, not more difficult; and that rail passengers can enjoy 5G services wherever they go. The sector needs to get ready to take on its next competitor: the autonomous car.”

    MEPs today voted on an informal agreement that the Council and Parliament reached earlier this year. The Package will soon be published and likely enter into national law in 2019.