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Comment by alistairSH | Hacker News Reader

Why is train so much more expensive? Surely jets that cost $100s of millions, supported by massive airports, are more expensive? Seems like the market distortions are subsidies to airlines of some sort.

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Jet fuel is tax free in the EU, a huge market-distorting subsidy:

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

However, as of 2018, commercial kerosene consumption is currently tax exempt under the legislation of all member states of the European Union.

Rail lines are massively subsidized and the French government is regularly bailing out SNCF (the national rail company). So imho it not clear that the global market distortion is in the favor of plane.

Many airports are also subsidized. Basically every kind of transportation is subsidized to the point that figuring out the true cost is really hard.

Just like cars are heavily subsidised through motorway building. Every form of transport receives subsidies as a public good, even in countries where transport infrastructure is nominally privatised. This is one area where letting the free market decide invariably ends in disaster.

> Jet fuel is tax free in the EU, a huge market-distorting subsidy:

Also, are the externalities of jet exhaust taken into account? Is there any kind of carbon pricing in EU/France?

I suspect in case of the Eurostar high speed train they simply follow the airline ticket pricing for the same destinations and add their "convenience tax" on top of it, usually around £50. Saying this because I've noticed that their prices fluctuate together with airline ones, and they fluctuate wildly.

Yes, despite being state-owned, Eurostar operates like a classic price-maximizing monopoly. Thalys is much cheaper, I wonder what will happen now the two are merging. Hopefully Renfe will launch its competing service soon on the London to Paris route.

High-speed railway infrastructure is expensive, and so is a modern high-speed train, which is not technologically less sophisticated than an airliner.

Competition, and the subsidies are the other way around: many train companies receive them, and most airlines don't.

I'd argue that not pricing in the negative externalities of flying amounts to a subsidy.

I’d agree with you except that EU airlines have to participate in the cap and trade system (ETS), whereas trains do not.

Do trains in France use the same sort of demand-driven pricing scheme airlines use? People tend to estimate airline pricing based on the cheapest price they see, which is often a fraction of the cost when demand changes.

> Do trains in France use the same sort of demand-driven pricing scheme airlines use?

For the high-speed trains, yes.

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