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December 2008
Next Big Things
Next in: Travel
Airlines' tunnel vision
On the back of record fuel prices, high-speed trains look set to soon trump short-haul flights in Europe, and airlines are wanting slice of the action. In September the mighty hyphenate Air France-KLM announced it would enter into a joint venture with French transportation service-provider Veolia to
offer international high-speed rail service. Planned routes include connections between Paris and Amsterdam, KLM’s main hub, and Paris and London — via a rival service to Eurostar — beginning in October 2010.
The journey time from London to Paris would be just under two hours on Air France-KLM’s trains, compared to Eurostar’s current time of two hours and 15 minutes. Virgin Atlantic is also believed to be thinking about setting up a high-speed rail service and Deutsche Bahn has confirmed that it wants to run a London-Cologne service from 2010.
Veolia and Air France-KLM have been in talks with Alstom, the maker of the TGV high-speed trains used by France’s state-owned SNCF. Alstom is developing a new generation of train, the AGV, which can carry up to 900 passengers at 360km/h, allowing commuting between Paris’s Charles de Gaulle airport and Amsterdam’s Schiphol airport in around an hour and a half. On 1 January 2010, the EU’s railway traffic laws will be liberalised for international traffic, and SNCF’s monopoly on domestic passenger carriage will end in 2017.
In 2005, Air France-KLM CEO Jean-Cyril Spinetta spoke about having high-speed trains one day “in the colours of Air France” and called the TGV train “an aeroplane on wheels.” The shrinking profit margins for short-haul flights this year have coincided with railway firms putting faster trains and routes into operation. Eurostar reported a 25% increase in sales in the first half of 2008.
Pacts between airlines and railway firms already exist in Europe. In Germany — where high-speed rail is dominated by state-owned Deutsche Bahn — Lufthansa passengers can use their airline tickets to reach its Frankfurt hub from cities such as Stuttgart or Cologne. Virgin Air has similar arrangements in the UK, where Virgin Group has a 51% share of Virgin Trains.
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