UK Edition
Spain plots challenge to Eurostar’s Channel Tunnel monopoly
Spanish state-owned rail operator holds talks with HS1 about running passenger services from London St Pancras to Paris
Eurostar is facing a challenge to its monopoly running rail services under the English Channel as Spain's state-backed operator plots a challenge to its French-owned rival.
Renfe, which this week boasted of its return to profitability without state subsidies from Madrid, is threatening Eurostar's dominance for the first time since the crossing was opened in 1994.
The move comes as the latest twist in a tit-for-tat battle between rail companies on the Continent as they implement Brussels rules forcing them to liberalise long-distance train journeys.
Renfe's bosses claim the service could be profitable within four years and have earmarked seven trains. These would need to be approved by the UK and HS1, the privately-owned high-speed line between Folkestone and St Pancras station.
Renfe has held talks with HS1, owned by a collection of pension and infrastructure investors, about starting services, according to Railway Gazette International, which first reported the Spanish’s firm’s interest.
Eurostar has had a monopoly on operating passenger rail services through the Channel Tunnel for more than a quarter of a century.
Although its trains have slashed air travel from London to Paris and Brussels, opinion remains divided as to whether the service has been a success.
Earlier this year Eurostar was taken to the brink of collapse after Britain refused to rescue it. Grant Shapps, the Transport Secretary, said Eurostar was “not our company to rescue”.
David Cameron sold Britain’s stake in Eurostar in 2015 for £750m and it is now majority-owned by French state operator SNCF.
Eurostar later struck a rescue with lenders and its shareholders and plans to merge with Belgian high-speed operator Thalys later this year. The deal could lead to Eurostar services running between cities on the Continent for the first time.
Renfe’s plans to encroach on the SNCF-owned monopoly under the Channel follow the French operator launching services in Spain earlier this year.
Renfe said: “According to the demand analysis carried out, it would be viable and profitable for Renfe to compete with Eurostar.”