Eurostar ‘cannot be allowed to collapse’ says Irish MEP
Nick Brooks was speaking days after the Alliance of Passenger Rail New Entrants (ALLRAIL), of which he is the Secretary General, published an analysis in which it highlighted plans by SNCF, which has a 55 percent stake in Eurostar, to open Ouigo Espana, a open a new high speed service in Spain, at a cost of £513million (€600million). The project, which has been put back as a result of the coronavirus pandemic, has been put back to May – but will begin operating at precisely the same time Eurostar has warned services between London, Paris and Brussels are likely to hit the rocks.
Speaking last month, France’s Transport Minister Jean-Baptiste Djebbari said the French government was prepared to help Eurostar – and also urged the UK to commit to a similar financial investment.
In March, Eurostar chief executive Jacques Damas warned: “Eurostar is losing in the region of £500million (€585million) a year”.
Eurostar and Ouigo belong to the same sub-division (SNCF Voyages) of the same division (SNCF Voyageurs) of the parent group (Group SNCF).
Emmanuel Macron and Boris Johnson are both being asked to plough cash into ailing Eurostar
Nick Brooks said SNCF was acting like a “chameleon”
Mr Brooks told Express.co.uk: “It is inconceivable that over the past 12 months of the pandemic neither SNCF Voyages Director General Alain Krakovitch nor Group CEO Jean-Pierre Farandou would not have known about the dire financial situation facing Eurostar and would have not been in a position to postpone the launch of OUIGO España in order to shore up rescue funds.
“But, still in late October 2020, OUIGO Espana’s CEO Helene Valenzuela said SNCF was launching OUIGO Espana for €600m – which is enough to save Eurostar.
“The sad irony being now it will launch in May 2021, the very same month that Group SNCF CEO Farandou says that Eurostar will run out of money.”
Mr Brooks asked: “Does SNCF somehow assume that, as a publicly owned company, it will get the money for such foreign expansion at some stage – no matter what?!
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Ouigo is in the same SNCF sub-division as Eurostar
“We cannot think of any other explanation as to why it is proceeding with a massive discretionary spend like this in the midst of a crisis.”
If UK taxpayers forked out cash to bail out Eurostar, the new cash flow would indirectly help SNCF to proceed with launching Ouigo Espana, Mr Brooks said.
He added: “Meanwhile: privately-owned passenger rail operators in Europe have had to put their future growth plans on hold thanks to COVID-19.
“At the moment, it is about sheer survival and not global expansion.
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France’s Transport Minister Jean-Baptiste Djebbari
Group CEO Jean-Pierre Farandou
“Therefore, it is a double standard that SNCF’s CEO is calling for state aid for Eurostar but starting a brand new high speed operator at the same time.
“Is the European passenger rail system an A La Carte Menu for state-owned rail incumbents like SNCF?
“Demanding state aid in one country while starting a new multi-million-euro project in another country?
“SNCF acts like a chameleon with a different narrative to suit its varying needs, ie being a publicly owned company providing the crucial Channel Tunnel link that will be lost (France, UK) and commercial newly founded start-up (Spain) at the same time.”
Eurostar runs services between London, France and Brussels
Mr Brooks also wondered whether SNCF was therefore ready to let Eurostar go bust while spending the money on launching in Spain instead, if neither the UK nor France was prepared to invest any public funds.
He added: “I must stress: ALLRAIL is in favour of state aid to help Eurostar, but there must be strict competition remedies.
“For example, SNCF must give independent operators equal access to the usable 2nd hand TGV & Eurostar trainsets – such as the ones it supplies to its subsidiary OUIGO – at fair, reasonable and non-discriminatory commercial terms.”
He warned: If monopolist Eurostar receives state aid without any conditions, it will likely just take the money for granted and everything will revert back to the way it was previously.
Eurostar trains at Waterloo, before the terminus was moved to Kings Cross
“That means: it will remain the only operator through the Channel Tunnel – with most expensive prices in Europe – for the next 20-30 years.
“Modal shift to passenger rail between the UK and the EU will simply not happen.
“State aid should not be used to protect such a model, which is why competition remedies are very important indeed.”
Express.co.uk has contacted Eurostar to offer them a chance to comment on Mr Brooks’ remarks.