Thursday, September 10, 2015

Dumb high-speed rail story, smart comments

The system that will never be built

A dumb, pro-high-speed rail story (What America Can Learn From Europe’s High-Speed Trains) prompted a lot of smart comments.

High-speed rail is losing money in France, which America already knows how to do with Amtrak:

They are admired the world over for their sleekness, speed and sheer French chic. But the 480 high-speed trains (Trains à Grande Vitesse, or TGV) that radiate around France from Paris are struggling to remain in the black. Most of the lines are running at a loss and even the profitable ones are not earning enough to cover their cost of capital. This is forcing SNCF, France’s state-owned railway, to consider taking the axe to what has been a rare symbol of French technical and business success...

And in Spain...

Some countries may have overextended their networks. In France, whose Trains à Grande Vitesse (TGVs) launched high-speed rail in Europe in 1981, traffic, revenues and profit margins have fallen from their peaks. To keep local politicians happy, TGVs stop at too many places, the national auditor concluded recently. Cheap flights and co-voiturage, or car-sharing, are siphoning off customers; SNCF has started a cut-price service in response. Spain’s high-speed track is even longer than France’s, despite it having about a fifth as much passenger demand. Fares were cut in 2013 to boost demand, but on many routes there are still plenty of empty seats...

See also this on Spain.

And in China:

Zhang Jian at the Beijing Transport University says only three large high speed projects have come close to making enough profit to pay for their construction---the rail links between Tokyo and Osaka, Paris and Lyon, and Beijing and Shanghai. (A short line connecting Beijing to the port of Tianjin has also been in the black.).

“Nowhere else in the world is there sufficient population density to make high speed rail services profitable,” Mr. Zhang says.

So to switch to high speed trains, governments must either fund construction themselves, or ask China to help. And nobody expects Beijing to offer such aid.

“For a first project, China might be ready to spend some money on advertising,” says Prof. Gao, who also teaches at Duke University. But he says that China is unlikely to repeat such financing. 

So in California, where Chinese companies have expressed interest in a high speed rail link, and in India, where they are doing feasibility studies, “the biggest factor is economic,” says Dr. Liu in Newark. “Where are they going to find the money to fund the system?” (emphasis added)

Where indeed? What about cap-and-trade?



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