Alta VelocitÓ in Italia

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Feb 8th, 2018, 08:11 AM
  #1
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Alta VelocitÓ in Italia

Many, including myself, have made numerous postings about both Trenitalia (Frecciarossa) and NTV (Italo) high speed trains.

Despite many attempts by Trenitalia to create difficulties Italo has survived and recently posted its first profit. More importantly when considering an IPO on the Milan stock exchange it received an offer from GIP, a New York based infrastructure fund, which was accepted unanimously by the shareholders of NTV.

What does this mean? First of all, NTV is now in the hands of a financially strong and professionally managed entity. Second, competition in the Italian high speed market is ensured so ensuring competition which will benefit all travelling in Italy.
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Feb 8th, 2018, 08:28 AM
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A harbinger for other European countries one hopes.
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Feb 8th, 2018, 08:52 AM
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PalenQ - I am hopeful but doubtful.

The UK is perhaps the most open market in Europe but the way things have been structured (pro providers and anti users) has resulted in exhorbitant fares. On many occasions I have flown to Stansted and my flight has cost less than the train fare to central London.

Much has been said about Brexit but what needs to be understood is that the Eu is a customs union which defends those within but penalises those without (compare the tariffs on cars between the US and Europe for example).

But what ia equally important are the barriers within EU trade which supposedly do not exist. How successful would NTV (or Trenitalia) be in France or Germany?
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Feb 8th, 2018, 10:19 AM
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NTV shareholders included SNCF. So I'm guessing they would do fairly well in France. TrenItalia owns Thello in France

Last edited by Traveler_Nick; Feb 8th, 2018 at 10:21 AM.
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Feb 8th, 2018, 10:50 AM
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Traveler_Nick - you are incorrect. SNCF is no longer a shareholder so your supposition is incorrect.
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Feb 8th, 2018, 02:15 PM
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There are no barriers for intra-EU competition in the transport sector..
Most competition focuses on regional or local transport where services are usually put up for tender through a franchise system.
You have Arriva operating trains in Germany, and RATP operating buses in London.
And Austrian Rail operating the sleeper routes from Germany. And so on and on.
High-speed trains and routes may look like the crown jewels of public transport but account for only a small percentage of travel - compared to local and commuter travels.
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Feb 8th, 2018, 03:17 PM
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France - my French friends say many local trains no longer run by SNCF but by departments with subsidies from them. My son was buying a train ticket Orleans-to a place in Massif Central and they had to buy four separate tickets - one for each separate train - Orleans station could not sell one ticket as always been the case. these local trains were money-loser probably for SNCF - I think SNCF unions are still strong and would protest against any real competition on long-distance routes.
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Feb 8th, 2018, 04:30 PM
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So nochblad, out of curiosity, should we be thinking of investing in NTV?
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Feb 9th, 2018, 12:18 AM
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StCirq - no because it is not possible.

NTV is a private company and has been purchased by GIP a NY based global infrastructure fund. GIP has said that existing shareholders of NTV can continue to hold up to 25% but I suspect that most if not all will exit. GIP may wish to have an important Italian shareholder or two for political insurance reasons but I think it will be hard for them to find someone willing. Just before the sale to GIP two very senior Italian ministers issued a joint statement indicating that they would have preferred for the shares to have been quoted (as was the plan before GIP arrived on the scene). This was a quite incredible intervention which was widely criticised due a very clear conflict of interest. Trenitalia is owned 100% by the Italian State.
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Feb 9th, 2018, 02:42 AM
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Interesting. Thank you.
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Feb 9th, 2018, 03:35 AM
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PALEN:
The real harbinger is Germany where you find many different companies operating along the same routes at different tariffs.
Westbahn and Italo do the same in Austria and Italy.
In France (and somewhat in Italy) you have a tariff jungle because local traffic got into the competence of local authorities (Regions) who define the local transport offer and pay for it (and fix the tariffs).
Since then, you have to change trains at Ivrea (close to the provincial border) if you travel from Turin to Aosta and since then you have no longer direct trains from Turin (Piedmont) via Tenda (France) to Ventimiglia (Liguria).
That doesn't mean that there is more competition, however: the trains ordered by the regions are operated by Trenitalia resp SNCF nevertheless. Things are more complicated in Lombardy (with TreNord), but there isn't real competition either.

Furthermore, real competition can be prevented by the Infrastructure authorities (in Italy RFI) resp. by the authorithy which defines the slots which can be bought by private operators. Don't forget that Italotreno was founded by a person who knew very well all the important people in the transport sector. May be he wouldn't have succeeded otherwise.
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Feb 9th, 2018, 07:38 AM
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Competition doesn't mean lower prices. Railroads are natural monopolies.

Look at what "liberalization" of telecom has done. In densely populated cities you do have competition. Those are the profitable areas. The further you get from those areas the less choice. Eventually you end up with no choice at all.

In the past the monopolist would have been required to provide everybody a similar level of service. Now you've got small centres dying off in part because of the lack of telecom services.
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Feb 9th, 2018, 08:34 AM
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Be happy that you even HAVE wide-ranging passenger services. I wish we did in the US.
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Feb 9th, 2018, 09:20 AM
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neckervd - Is now Westbahn owned by Austrian State Railways - thus one and the same.

Thanks for an enlightening discussion of great interest to this rail nut!
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Feb 9th, 2018, 09:21 AM
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Should have been is NOT Westbahn owned by Austrain Railways?
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Feb 9th, 2018, 09:22 AM
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Traveller_Nick - you must distinguish between ownership of the track and the train companies. Competition between Italo and Trenitalia has very much resulted in lower prices and a better and faster service. Milano to Rome is now reachable in under 3 hours which is frankly incredible. One result of this is that much traffic between the 2 cities has shifted from air to train which is significant considering that Milano - Rome was once the busiest air corridor in Europe.

What is important though is the balance between operators and users. As a user the situation in Italy is fantastic in terms of fares - especially the high speed routes. In the UK there is competition between operators to get a monopoly on certain sectors. This has resulted in substantial funds flowing to the government but the user ends up paying for this auction process. Every time I am in the UK I am horrified by the cost and the service in comparison with Italy and nearby Switzerland.
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Feb 10th, 2018, 12:24 AM
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Originally Posted by nochblad View Post
Traveller_Nick - you must distinguish between ownership of the track and the train companies. Competition between Italo and Trenitalia has very much resulted in lower prices and a better and faster service. Milano to Rome i.
Which is exactly my point. The competition is great for Milano to Roma. It's a disaster for all the smaller towns. The competitors have no reason to invest in the relatively unprofitable routes. They will never serve those smaller towns with the same service.
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Feb 10th, 2018, 05:54 AM
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Traveler_Nick - there are of course many routes which are not or hardly profitable but I am sure that many in Lombardia would wsih that there was a competitor to Trenord offering a quality and efficient service such as the Tilo trains. However, local services are so often compromised politically especially since the Region oftens provides a subsidy and the operator such as Trenord is a cesspit of corruption, bad management etc (the italian papers have countless stories on this). So the reason for lack of competition is not always due to the issue of potential profitability of the route.
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Feb 10th, 2018, 06:09 AM
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All of the EU rail lines are supposed to at least begin to open up to competition starting in 2019. It will be completely obligatory in 2023.

In France the TER (regional) lines now under the control of the various regions of France will reputedly be offered to the highest bidder as of December 2019. We just have to hope that everybody has learned from some of the errors that took place when the British rail lines were privatized.
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