Air France plans to enter high-speed rail venture with Veolia on routes to London and Amsterdam
TGV at Paris CDG Airport
Thu 11 Sept 2008 – As the environmental pressure grows on travellers to take the train rather than the plane on short-haul routes, Air France has adopted a “if you can’t beat ‘em, join ‘em” approach and is poised to enter a joint venture with the major French transportation services provider Veolia to operate high-speed trains from Paris to destinations such as London and Amsterdam. However, Air France has dampened speculation that an agreement between the two is to be signed next week, saying it is still “examining the possibility”.
A move into international high-speed train operations would be made possible by EU liberalization of international rail traffic from January 2010. Reports suggest that Air France could start rail services to London and Amsterdam as early as October 2010.
Air France and Veolia Transport are believed to be interested in leasing or purchasing a new generation of trains, known as the AGV, from high-speed train manufacturer Alstom. The AGV is capable of carrying 900 passengers at speeds of up to 224mph (360km/h), considerably faster than the current TGV’s 186mph (300km/h). At such speeds, passengers would be able to travel between Air France’s hub at Paris CDG and its partner KLM’s hub at Amsterdam Schiphol in around one-and-a-half hours. Journey times from Paris to London could be less than two hours.
Not only is there a growing pressure on travellers to take the greener rail option wherever possible, but the erosion of profits on short-haul air routes and the increased competition from high-speed trains has been of concern to Air France for a number of years.
“Limiting our activity to aircraft operation and ignoring market trends constitutes a risk,” the airline’s Chairman and CEO Jean-Cyril Spinetta told shareholders in July. “We have reached the logical conclusion that we need to seriously examine the possibility for Air France to operate trains under the Air France brand to several destinations in partnership with a rail service provider.”
Spinetta says the high-speed train is the airline’s main competitor, rather than other low-cost carriers, where the average rail journey time is less than 3.5 hours. “For instance, high-speed rail has drained 90% of market share on the 2-hour trip from Paris to Lyon and 70% on the 3-hour trip to Bordeaux. As a result of this competition, we have had to suspend our service between Paris-Orly, Avignon and Rennes. We have reduced our frequencies between Paris-Orly and Lyon to one daily flight. We have reduced our frequencies between Orly and Strasbourg and suspended the CDG-Brussels service.
“As a consequence, it would seem logical to replace these air transport services with a rail transport solution so that we can continue to provide our customers with a global offer, meeting both their short-distance and intercontinental needs.”
However, the liberalization of the EU’s rail traffic system from 2010 only applies to cross-border services so on domestic routes Air France will have to continue competing with the state-owned SNCF.
On the Paris-London route, Air France would be up against Eurostar, which has enjoyed a booming popularity in cross-Channel high-speed rail travel. In the first half of this year, its passenger traffic grew by 18%.
A spokesman for Eurostar told The Independent newspaper that airlines had “a lot to learn” before they could compete.
“It’s no surprise that airlines hit by high oil prices and congested airports are trying to turn themselves into train operators,” he said. “We will try to compete with them whether they use wings or wheels.”
According to Eurostar’s figures, an average return short-haul flight between London’s Heathrow and Paris emits 122kg of CO2 per passenger or 168g of CO2 per passenger km, compared with 10.9kg of CO2 per passenger or 11g of CO2 per passenger km on a return Eurostar rail journey between the two capitals.
Eurostar has also committed to reducing its CO2 emissions by 25% by 2012 compared with 2006. Since last November it has claimed carbon neutrality by offsetting all its passengers’ emissions.