Low-cost RR to compete against Deutsche Bahn

The Local (German edition)

Touting its new high-speed, low cost trains, a private company is ready to take on the Deutsche Bahn on the busy Cologne-Berlin route and should be hitting the tracks in early autumn, it was announced this week.

The company, MSM, will be offering customers tickets from just over €19 – an initiative CEO Nike Maedge likened to that of “a budget airline with a variable pricing system.”

The cheapest ticket Deutsche Bahn offers for a one-way journey is €29.

Currently, Deutsche Bahn enjoys a monopoly, providing Germany’s only high-speed intercity trains – the ICE and the IC. This earns the company around €3.8 billion each year, according to reports from the German Financial Times (DFT) on Thursday.

If MSM’s plan is successful, it will be Deutsche Bahn’s only direct competition – a role other companies have tried, but failed, to fill. …

Traditionally, competing railroads built their own rails and didn't run on the same rails as a competitor. Can anyone see this going somewhere?

More interesting is what is happening in Austria and Italy, where the established national railway company is being seriously challenged by a newcomer with more robust schedules compared to MSM in Germany.

amtrakowitz wrote:The Local (German edition)

Touting its new high-speed, low cost trains, a private company is ready to take on the Deutsche Bahn on the busy Cologne-Berlin route and should be hitting the tracks in early autumn, it was announced this week.

The company, MSM, will be offering customers tickets from just over €19 – an initiative CEO Nike Maedge likened to that of “a budget airline with a variable pricing system.”

The cheapest ticket Deutsche Bahn offers for a one-way journey is €29.

Currently, Deutsche Bahn enjoys a monopoly, providing Germany’s only high-speed intercity trains – the ICE and the IC. This earns the company around €3.8 billion each year, according to reports from the German Financial Times (DFT) on Thursday.

If MSM’s plan is successful, it will be Deutsche Bahn’s only direct competition – a role other companies have tried, but failed, to fill. …

Traditionally, competing railroads built their own rails and didn't run on the same rails as a competitor. Can anyone see this going somewhere?

Yes, actually. It's called "open-access" and it's been mandated by the EU. It was pioneered in the UK's 1993 privatization, where the train operating companies are split from the track owner (originally Railtrack; now Network Rail), and the EU wrote its rail regulation laws based on that experience. Eventually DB (the train operator) will have to dissociate itself from ownership of the rail infrastructure--that is, spin off DB Netz--the same process is ongoing elsewhere in the EU, e.g. France.

Whether or not this is a good is still very much up in the air. One of the most fundamental issues raised in the UK, particularly by the Hatfield incident, is that a for-profit rail infrastructure provider may be utterly unable to offer rail infrastructure at profit; that is, money is made in this game by not providing what you're supposedly charging for. (The analogy is a similar complaint about the U.S.'s for-profit health insurance companies.) As a result, the UK, which went furtherest in rail privatization, has also retrenched some: Network Rail is a state-owned company, same as DB (and hence DB Netz), RFF, etc., whereas the original Railtrack was wholly private.

These two companies, one in Austria, and one in Italy, are much more interesting than MSM in Germany. Both are competing against the established national railway company on the same tracks.

WESTBahn in Austria is up and running now.

https://westbahn.at/

Nuovo Trasporto Viaggiatori in Italy will be up and running within a month operating true HSR trainsets.

http://www.ntvspa.it/en/nuovo-trasporto ... high-speed

hammersklavier wrote:

amtrakowitz wrote:The Local (German edition)

Touting its new high-speed, low cost trains, a private company is ready to take on the Deutsche Bahn on the busy Cologne-Berlin route and should be hitting the tracks in early autumn, it was announced this week.

The company, MSM, will be offering customers tickets from just over €19 – an initiative CEO Nike Maedge likened to that of “a budget airline with a variable pricing system.”

The cheapest ticket Deutsche Bahn offers for a one-way journey is €29.

Currently, Deutsche Bahn enjoys a monopoly, providing Germany’s only high-speed intercity trains – the ICE and the IC. This earns the company around €3.8 billion each year, according to reports from the German Financial Times (DFT) on Thursday.

If MSM’s plan is successful, it will be Deutsche Bahn’s only direct competition – a role other companies have tried, but failed, to fill. …

Traditionally, competing railroads built their own rails and didn't run on the same rails as a competitor. Can anyone see this going somewhere?

Yes, actually. It's called "open-access" and it's been mandated by the EU. It was pioneered in the UK's 1993 privatization, where the train operating companies are split from the track owner (originally Railtrack; now Network Rail), and the EU wrote its rail regulation laws based on that experience. Eventually DB (the train operator) will have to dissociate itself from ownership of the rail infrastructure--that is, spin off DB Netz--the same process is ongoing elsewhere in the EU, e.g. France.

Whether or not this is a good is still very much up in the air. One of the most fundamental issues raised in the UK, particularly by the Hatfield incident, is that a for-profit rail infrastructure provider may be utterly unable to offer rail infrastructure at profit; that is, money is made in this game by not providing what you're supposedly charging for. (The analogy is a similar complaint about the U.S.'s for-profit health insurance companies.) As a result, the UK, which went furtherest in rail privatization, has also retrenched some: Network Rail is a state-owned company, same as DB (and hence DB Netz), RFF, etc., whereas the original Railtrack was wholly private.

I asked whether it was going somewhere, not whether the EU was mandating it (per Directive 91/440); I see a lot of takeovers of EU rail and bus networks by Deutsche Bahn instead. This may result in greater monopoly rather.

Nobody regards the UK's privatization as a success; not even the UK themselves.

According to the latest issue of Modern Railways, OeBB is throwing roadblocks in the way of Westbahn ((Freilassing-) Salzburg - Vienna): OeBB omitted their schedules from the national timetable, Westbahn got a court order requiring that their schedules be shown in the national timetable, and OeBB has now announced that it will no longer issue a national timetable. Also, it is reported that Westbahn employees (presumably train crews) are being denied access to stations until their train is actually at the platform. Regardless of what the EU requires, there's a lot of resistance by the established rail networks.