Hacker News Reader

Comment by 1cvmask | Hacker News Reader

Apparently there is little current economic incentive (or regulatory push) to streamline the process and take on airlines in cross-border travel:

Railway companies are national in nature and by history. The share of cross-border travelling is small; the income mainly comes from national rail.

Obviously if they streamlined the process to take on airlines their revenue would increase. But perhaps the cost of streamlining would outweigh the revenue increase. Unfortunately it is almost impossible to create a disruptor in the train space due to rules, regulation and the capex nature of it. Whereas the airline space is easy to enter as a competitor even though it is capex heavy because the core asset (planes) are mobile. You can move them from very competitive market to another one that has less competition if the laws (and airport slots) allow for it.

https://en.wikipedia.org/wiki/Contestable_market

View on HN

Rail services in European countries are not covering their costs in any country, as far as I know. Speaking of Switzerland (which is notably at the extreme end in terms of costs) public rail services are run a lot like infrastructure projects / economic booster packages by the government. Whether or not ticket prices or capacities are increased is more down to politics and economic perception than actual demand. So it's fairly obvious that there are no incentives to make cross country traveling more attractive. Politicians decide about the rail services and they are only interested in the opinions of their constituents. More crowded trains due to tourists might as well hurt their popularity. It's a broken system in certain ways.

The fact that a lot of the money for passenger rail in europe is coming in from regional bodies for running regional trains also means that fast intercity trains don't get priority when there is congestion, and that the planners kind of assume that people who miss their connection can just take the next one which is true for regional trains but not always cross continental express routes.

If we actually had a high speed rail network that linked the big European cities it would pay for itself like in Japan. Tax kerosene and nobody would fly from Amsterdam to Berlin.

The infrastructure is subsidized, local transit is subsidized, but long distance and high speed rail operations can be profitable, even including the capex of rolling stock (In fact EU rules stipulate that they should be unsubsidized).

Also, the EU mandates open track access, which means technically it's possible for private companies to compete (and they do, there are several private operators like Flixtrain, RegioJet, LeoExpress, even a high speed one in Italy, Italo).

It's also possible to have rolling stock that is fairly usable all over Europe (RIC carriages, usually 200km/h). There is even a bit of a market for used vehicles. As for locomotives, traditionally they only work in one country, or perhaps two. Now there are more and more locomotives that work in multiple countries, e.g. TRAXX and Vectron. It's possible to rent carriages and trains. It's also possible to rent traction.

In some sense it's getting close to possible to do a startup in European rail. I'm thinking about the problem a lot.

This and the kerosene is tax free, which is impossible to compete with.

The problem is if you do tax it, airlines are going to fill up in places like Dubai and drag tonnes of fuel across the world, leading to more fuel burn in general. For the environment it'd be a bad thing unless the tax were imposed globally.

This would have been an ideal point to agree on at Glasgow but of course it didn't happen.

Also revenue comes from freight, passenger transport is just a subsidised public service.

Really depends on the individual countries. Some countries subsidize the tracks for everyone (including freight), others just the passenger rail companies. Heck, in the EU there's even quite a few open-access operators who are fully for-profit.

knowing the cost of a bullet train railway, and the fact that freight trains don't use them, I'm skeptical, as far as I know, it's tax money and debt that "pays" for it.

Additionally, a lot of countries in Europe view their airline as a national pride.. And so do anything to put it ahead. Trains are not as glamorous.

There's also very little capacity on the rail network and if they sell short trips as opposed to one long one they can sell the same seat multiple times over the same international trajectory. And in those short trips they don't have planes to compete with so they can ask higher prices.

Reply on news.ycombinator.com