High-Speed-Rail Profitability?

HSR systems are often described as making operational profits, and perhaps even enough profit to finance their construction, but I would like to verify that assertion before repeating it, if at all possible.

I did a bit of that myself, checking on the French national railroad's site: http://www.sncf.com and its 2007 Financial Report -- the TGV's are in SNCF's Passenger France and Europe division, and SNCF claims that that division had returned a profit.

However, it was an overall revenues - expenses figure, and the report did not break down the revenues by source: tickets, ads, renting space in stations, possible subsidies, etc. I wanted to be sure that the subsidy figure is EUR 0.00 before continuing.

I also tried searching through the Spanish national railroad RENFE's reports with no success, and I could not find anything on the Eurostar's financials. Germany's, Italy's, and Japan's railroads may be even more difficult.

The Amtrak OIG report: http://www.amtrakoig.com/reports/E-08-02-042208.PDF shows that France provided 7.8 euros of public funding for each euro of "operational profit" that SNCF claims.

First, the rail infrastructure (including the LGVs on which the TGVs run) is owned and maintained by RFF, not by SNCF. This is in keeping with the European Union mandate to split national railroads into separate infrastructure and operations companies. If you look at the RFF annual report (requires Flash) for 2007, you will see that they spent 5.1 billion euros on the railroad network, but only took in 2.6 billion euros of revenue. The difference of 2.5 billion euros is made up by the government.

Second, as you noted, SNCF does not provide a breakdown of revenue. Therefore, you do not know how much of this revenue consists of payments from the government. You also do not know how much is TGV-related and how much is conventional.

General wisdom around here is that Amtrak's Acela and/or Northeast Corridor make money...and Amtrak pays for the maintenance of all that infrastructure I believe. That's as high-speed as we get in the U.S., but it seems like as good an example as any. Amtrak as a whole does not make money, but if you pretend the NEC is its own entity then it is a profitable stretch of rail.

i think that "making money is that tey cover thier direct costs . i dont think it covers any contribution to the infrastructure up keep .

I think the original TGV line to Lyon is profitable, overall. The other lines probably are not, and some are built for various political reasons.

Accounts for state owned businesses in France tend to be difficult to access. For example, no-one really knows whether the nuclear industry actually makes a profit.

I will now speculate about the economics relative to more traditional sorts of trains.

• Capital costs: minus -- high-speed operation is very demanding
• Maintenance costs: minus -- like above
• Labor costs: plus -- each employee is involved in more trips per day
• Energy costs: minus -- more air resistance and other friction to overcome
• Amenity costs: plus -- limited food service and absence of sleeper cars

How the numbers work out I've had a hard time discovering.

I'll now compare two trains that operate over similar distances and over similar terrain, for the purpose of assessing the labor-cost hypothesis:

Chicago - St. Louis: 298 mi / 478 km
Car: 4h 52m - 59 mph / 98 kph
Amtrak's Lincoln Service: 5h 10m - 58 mph / 93 kph

That is my estimate of the nonstop time; from Amtrak's schedules, intermediate stops translates into total time as:
9 - 5h 30m
4 - 5h 20m

Paris - Lyon (St. Exupery): 289 mi / 466 km
Car: 4h 14m - 68 mph / 110 kph
TGV: 1h 50m - 158 mph / 254 kph
(source: http://www.bonjourlafrance.com/ -- the Paris-Lyon TGV is nonstop)

(Distances and car times from Google Maps)

So the TGV-Lyon travels 2.75 times faster than the Amtrak-Lincoln train, meaning that the TGV-Lyon employees take care of 2.75 times as many passengers per day as the Amtrak-Lincoln ones for the same number of employees per passenger per trip. Which supports my labor-cost speculation.

Energy costs: minus -- more air resistance and other friction to overcome

That's solved by having a lower drag coefficient. There's a reason high-speed trains look the way they do. JR claims that their bullet trains use about 534 BTUs per passenger mile; SNCF has cited an average BTU usage per passenger mile of 229 (80 percent load factors).