Chugging along through the countryside on a train, it might be easy to look with envy to a sleek aircraft ascending overhead. But for the professionals in the rail industry, especially in Europe, it’s the more pedestrian differences between the sectors that stir jealousy.
Things like standardized payment systems, data-sharing systems, timetables that extend a year in advance.
“Where I am jealous of the airlines is they’ve had this standardization for 50 years,” said Paul Brindley, the B2B and indirect sales director at high-speed rail provider Eurostar. “We don’t have that in the rail industry. It’s getting better and better and better, but we are behind the airlines, there’s no doubt about that. A 12-month timetable? Does that really exist in the rail industry? Generally, we work on a three-month timetable. It’s absolutely getting better, but we’re not there yet.”
Brindley was speaking during a Center Stage presentation at the Phocuswright Europe conference last month in Barcelona, where a panel of experts discussed how European rail travel is being transformed despite hefty challenges and obstacles.
While they may be green with envy over some of airlines’ advantages, green is also the color of sustainability — and that concern, among other trends, helps feed the rail experts’ optimism that their industry could soon be soaring in its own way.
“I always say we are 10, 15, maybe 20 years behind the aviation industry,” said Björn Bender, CEO and executive chairman at rail ticketing platform Rail Europe. “Now it’s changing. What is changing in addition to the standards is how we work together. … We all have relationships on how we work together on a daily business, as partners to bring the industry forward.”
The greater collaboration may be overdue. While the sector enjoyed something of a quick rebound from COVID — gross bookings in Europe grew by nearly 30% year over year in 2021, Phocuswright data shows, while airlines on the continent grew by just 16% — the sector has not kept pace. Phocuswright projections show rail bookings growing in Europe at a slower pace than airlines through 2026.
One of the issues holding back the sector, Bender said, is the practice of relying on national railway systems.
“We are used to taking the train in one specific country,” he said. “Bringing this together and removing this patchwork of national railway systems is our job, and maybe it [will be] different two years from now.”
You spoke about the French market, the Spanish market, we should look at it as the European market, because, indeed, we have borders, but now they are thinner and thinner between our countries.
Anne Pruvot – SNCF Connect & Tech
Anne Pruvot, CEO of SNCF Connect & Tech, a division of French national railway company SNCF Group, also spoke of the need for a unified rail market.
“You spoke about the French market, the Spanish market, we should look at it as the European market,” she said, “because, indeed, we have borders, but now they are thinner and thinner between our countries.”
A study last year released by SilverRail found the combination of high-speed rail and increased competition led to better service, less expensive fares – and sharp increases on the lines that saw the increased competition.
The study highlighted the Madrid-to-Barcelona route in Spain, Rome-to-Milan in Italy and London-to-Edinburgh in the United Kingdom. Replicating the success of those routes around Europe isn’t simple, Pruvot said, because the creation of new competition is so “capital intensive.”
“We have a few competitors running high-speed trains in France, especially on the highest profitable route, which is Paris-Lyon,” she said. “But because it’s so capital intensive, the profit is not obvious when you are not an expert in the rail industry.”
That’s why it’s important to find growth in existing routes as well. To that end, SNCF is pushing multimodal connections to make it easier for passengers to get to and from train stations. The company seeks partnerships with public transit services, taxi companies, even bicycle and scooter sharing.
“It’s very important for us to help our clients to, first of all, use sustainable transport solutions, but also to be able to get to the station,” she said. “What we see as the main hurdle to take trains is really how to get there. Because nobody is … going on vacation in a station. We need to go somewhere else. And by helping them get somewhere else, we can get them [on] the train.”
The private Spanish high-speed rail operator Iryo follows a similar approach in pursuing growth. Customers on the company’s app can book taxi rides or connect with buses, other rail operators and even partner airlines, said Guillermo Castrillo, the company’s chief strategy and sustainability officer.
“We wanted to get our clients farther and ensure we can facilitate booking multimodal tickets throughout Spain,” Castrillo said. “We consider that’s one of the key elements for us to grow [and] for the rail to become the backbone of sustainable and multimodal mobility.”
Partnerships with other rail operators will be key to Eurostar’s goal of growing from 19 million annual passengers to 30 million by 2030 as the company pursues an open hub strategy, Brindley said.
“The open hub means we connect in key cities – Paris, Brussels, Amsterdam – in terms of onward connectivity, partnering with other rail operators,” he said. “On top of that we’re also looking at new markets, new routes but also new capacity. The job that we’ve all got is to grow the demand.
“If you’ve got a good rail system that’s high speed, interconnection, seamless for the customer, then actually you’re going to grow the demand for rail for the future.”
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Eurostar’s growth goes a long way toward explaining a statistic shared by Rail Europe’s Bender: “In 1995 you had 100 flights a day between Paris and London. Today it’s, I don’t know, 45, something like that. It’s still a lot. But it’s by half reduced,” Bender said, even as the number of flights globally has multiplied.
To boost sustainability in the travel industry, Eurostar’s Brindley called for European countries to place restrictions on short-haul flights when a convenient rail option is available, as France did.
“It hasn’t happened in every other country yet,” Brindley said. “There’s definitely an element around replacing short-haul [flights] with rail going forward, and that sustainability message is key within that story.”
As the increase in climate-related disasters places a greater focus on sustainability, the rail sector figures to benefit as travel’s “lucky partner,” Bender said, but that won’t be enough for rail companies or Europe overall.
“Rail and trains by nature are green in a way. That’s good,” he said. “But we as Europeans, as a global population, we are traveling more and more, so we are consuming more mobility, and we need to have answers for this, specifically in Europe and specifically when it comes to public transports.”
Watch the video below to see the full discussion.
21st Century Rail - Rail Europe, Eurostar, Iryo, SNCF - Phocuswright Europe 2024