hkskyline
June 15th, 2005, 07:10 AM
New train shifts inertia of French rail freight
The first entirely privately operated goods train on French tracks since 1938 may speed liberalisation in Europe.
14 June 2005
Financial Times
There has been a change in the colour of Europe's rail freight yards. A few years ago the locomotives all belonged to a national state-owned rail monopoly. Now, across much of the continent, locomotives are painted in the colours of new privately owned operators.
The entrants have been encouraged by national laws and by European Union legislation. Countries have been forced to separate their state railways' track-owning and operating arms from their train operators and to allow competition in certain markets. But until now, in France, one of Europe's largest rail freight markets, the only locomotives have been those of SNCF, the state-owned train operator.
Although EU law opened cross-border rail freight on the busiest routes within the Union to competition on March 15 2003, private applicants have been slow to receive safety certificates. They have also been put off by the high charges levied by RFF, which operates the French rail network. Goods crossing France have been forced to use the unreliable services of SNCF Fret, the state-owned rail operator's loss-making freight arm.
That changed yesterday when the first privately operated freight train left a lime works at Dugny, near Verdun in eastern France, bound for a steel plant in Germany. The train, operated by Connex, the transport arm of France's Veolia Environnement, was the first entirely privately operated French freight train since 1938. It faced hundreds of protesting trade unionists who fear that the private sector will undermine French rail workers' extraordinary power.
Supporters of liberalisation hope that the new service will mark the arrival in French rail freight of some badly needed private-sector know-how and entrepreneurial flair. A number of operators running trains elsewhere in Europe, including the UK's EWS, are set to follow Connex's example soon by operating in France. The opening-up of the French market could give renewed impetus to Europe's rail liberalisation process.
The continuing monopoly of some state railways and the bureaucratic obstacles placed in the way of market entrants prompted Jean-Arnold Vinois, the head of rail for the European Commission's transport directorate, to say last year that competition could be killed "in the embryo".
Andrew Traill, the head of rail freight policy for the UK's Freight Transport Association, said: "French railways have often been cited as holding back liberalisation, so this is laying down quite a strong marker to say (the market) is finally opening up."
Until now the many customers interested in using rail freight for journeys from the UK to continental Europe via the Channel Tunnel have been deterred by SNCF Fret's monopoly.
"Many are put off by the notion that there's only one provider in France and they don't have a terribly good track record in terms of service," Mr Traill says.
Yet, while customers may gain wider choice, better prices and better service from liberalisation, experience elsewhere suggests that trade unions are right to be concerned. In some countries the state train operator has lost market share for some of the most lucrative traffic soon after the market's opening.
On the Brenner Pass between Italy and Austria, Rail Traction Company, an Italian private company, has taken 35 per cent of the market after starting in only 2001. Trenitalia, the state-owned train operator, has suffered, partly because its union agreements oblige it maintain unrealist-ically high staffing levels.
In other countries the state train operator has sought to improve standards at the expense of union perks. Marcel Verslype, then a senior executive of Belgium's state-owned train operator, told a dinner in Brussels last year that if his company had not faced competition from DLC, the first private operator in Belgium, it would have had to invent it. DLC's presence had been invaluable in forcing the trade unions to accept new work practices.
Whether the French trade unions can be forced into abandoning some of their restrictive practices remains to be seen. Stephane Richard, Connex's chief executive, admits that his company's new service comes at a sensitive time for a liberalisation initiative. Many observers saw France's No vote to the proposed European Union constitution on May 29 as a rejection of EU liberalisation measures such as those in the railways.
The first entirely privately operated goods train on French tracks since 1938 may speed liberalisation in Europe.
14 June 2005
Financial Times
There has been a change in the colour of Europe's rail freight yards. A few years ago the locomotives all belonged to a national state-owned rail monopoly. Now, across much of the continent, locomotives are painted in the colours of new privately owned operators.
The entrants have been encouraged by national laws and by European Union legislation. Countries have been forced to separate their state railways' track-owning and operating arms from their train operators and to allow competition in certain markets. But until now, in France, one of Europe's largest rail freight markets, the only locomotives have been those of SNCF, the state-owned train operator.
Although EU law opened cross-border rail freight on the busiest routes within the Union to competition on March 15 2003, private applicants have been slow to receive safety certificates. They have also been put off by the high charges levied by RFF, which operates the French rail network. Goods crossing France have been forced to use the unreliable services of SNCF Fret, the state-owned rail operator's loss-making freight arm.
That changed yesterday when the first privately operated freight train left a lime works at Dugny, near Verdun in eastern France, bound for a steel plant in Germany. The train, operated by Connex, the transport arm of France's Veolia Environnement, was the first entirely privately operated French freight train since 1938. It faced hundreds of protesting trade unionists who fear that the private sector will undermine French rail workers' extraordinary power.
Supporters of liberalisation hope that the new service will mark the arrival in French rail freight of some badly needed private-sector know-how and entrepreneurial flair. A number of operators running trains elsewhere in Europe, including the UK's EWS, are set to follow Connex's example soon by operating in France. The opening-up of the French market could give renewed impetus to Europe's rail liberalisation process.
The continuing monopoly of some state railways and the bureaucratic obstacles placed in the way of market entrants prompted Jean-Arnold Vinois, the head of rail for the European Commission's transport directorate, to say last year that competition could be killed "in the embryo".
Andrew Traill, the head of rail freight policy for the UK's Freight Transport Association, said: "French railways have often been cited as holding back liberalisation, so this is laying down quite a strong marker to say (the market) is finally opening up."
Until now the many customers interested in using rail freight for journeys from the UK to continental Europe via the Channel Tunnel have been deterred by SNCF Fret's monopoly.
"Many are put off by the notion that there's only one provider in France and they don't have a terribly good track record in terms of service," Mr Traill says.
Yet, while customers may gain wider choice, better prices and better service from liberalisation, experience elsewhere suggests that trade unions are right to be concerned. In some countries the state train operator has lost market share for some of the most lucrative traffic soon after the market's opening.
On the Brenner Pass between Italy and Austria, Rail Traction Company, an Italian private company, has taken 35 per cent of the market after starting in only 2001. Trenitalia, the state-owned train operator, has suffered, partly because its union agreements oblige it maintain unrealist-ically high staffing levels.
In other countries the state train operator has sought to improve standards at the expense of union perks. Marcel Verslype, then a senior executive of Belgium's state-owned train operator, told a dinner in Brussels last year that if his company had not faced competition from DLC, the first private operator in Belgium, it would have had to invent it. DLC's presence had been invaluable in forcing the trade unions to accept new work practices.
Whether the French trade unions can be forced into abandoning some of their restrictive practices remains to be seen. Stephane Richard, Connex's chief executive, admits that his company's new service comes at a sensitive time for a liberalisation initiative. Many observers saw France's No vote to the proposed European Union constitution on May 29 as a rejection of EU liberalisation measures such as those in the railways.