Aus spikes again for Rail Europe

Rail Europe has again lauded Australia for outstripping its global growth as the rail marketing company announced two further deals that it said would benefit the local industry.

Figures released yesterday showed revenue from Australia leapt 63% to 30 million Euros in 2010 (A$42.2m). Globally, sales increased 41%.

Rail Europe chief executive Pierre-Stephane Austi, in Australia to meet key partners, pointed to increased distribution networks, marketing and improving technology as key drivers for the increase.

New deals struck with ATOC, the British rail system and RENFE, the Spanish rail network will see Australian agents given access to additional fares not previously available and generate further revenue opportunities , he added.

“This will particularly effect point to point tickets in the UK. In some cases this is a discount of up to 70% off the regular fare,” Austi said, adding that Australia was now a mature market with more repeat customers.

But executives warned it would be hard to replicate the growth next year. The 2010 figures were to some extent inflated coming off the back of a challenging 2009.
“We would be pleased with 10% growth in 2011,” said Rail Europe Australasia manager, Richard Leonard.

He added that all its Australia general sales agents - Rail Plus, CIT, Infinity Rail and Rail Tickets – had experienced similar growth patterns.

Rail Europe is jointly owned by the Swiss and French rail networks.

Why are governments so taken with high speed rail?

First off, there's the 'green' vote – 'greenhouse gas' emissions can be up to 90% lower than flying. It makes economic sense too – better transport links mean a more mobile, productive workforce, which makes life cheaper for companies. And rail schemes are also big employers. The Beijing-Shanghai link alone employs 110,000 workers.

In the US, $8bn of stimulus funds has been set aside for high speed rail projects. A $2.7bn project in Florida is set to open in 2015, and a Los Angeles-to-San Francisco link costing upwards of $40bn should open in 2020. And on Tuesday 28 September, Amtrak unveiled a $117bn, 30-year vision for a high speed rail line linking the entire East Coast.

Political grandstanding by the Republicans may cause problems for some of these projects. But the US is just one of many countries looking at high-speed rail. Here in Britain, construction on a line linking London to the cities of Birmingham, Manchester and Leeds is due to start in 2015. And projects are also underway in Spain, Italy, South Korea and India.

How China took the lead in high speed rail

The Shanghai train is a 'Maglev', short for 'magnetic levitation'. It actually floats just above the track. Magnets propel it forward silently and the lack of friction allows it to reach phenomenal speeds.

Ironically, the world's first commercial Maglev ran from Birmingham International to Birmingham airport back in 1984. But the UK let the technology slip through its fingers. The route was dismantled in 1995 and replaced by a bus.

Meanwhile, Beijing has eagerly sucked up all the cutting-edge rail technology it can find. When it announced its plans back in 2004, the companies that came forward to bid for the biggest rail contracts in history were a who's who of rail technology: Bombardier (Canada), Siemens (Germany), Alstom (France) and Kawasaki Heavy Industries (Japan).

In the competition for contracts, the companies agreed to onerous terms and conditions. Production had to occur in China, and they had to agree to 'technology transfers', effectively helping to set up their own cheap Chinese competitors. Beijing has a word for this acquisitive process: 'digesting'.

Six years later, high speed rail companies are now having to compete with the Chinese rivals they created. Two Chinese manufacturers, CSR and CNR, are already among the world's top four train makers, as the chart below shows.



These companies are now snapping at each other's heels to land contracts world wide. We're about to see the biggest expansion of rail since the days of the Wild West. Billions of dollars are being pumped into high-speed rail projects worldwide, from Bologna, to Argentina, to California. It could be one of the most lucrative investment themes of the decade.

The next big investment theme – high speed rail

To the average British rail commuter, the notion of sleek, efficient, high speed trains seems laughable. Just finding a train that can get you from point A to point B at somewhere near the promised time is an achievement. Doing it without bankrupting yourself is another thing altogether.

High-speed rail links are a dream that's been promised to the British commuter by various governments for years. Yet it never seems to come true.

But the outlook for commuters elsewhere in the world is far more promising. While you were slogging your way in and out of work yesterday, China was unveiling the fastest train line in the world.

And this isn't some bold but ultimately doomed 'prestige' project like Concorde. It's merely the latest addition to an already extensive network of high-speed rail links.

Indeed, I reckon high speed rail could be one of the most important investment themes of the next few years. Here's why.

The world's fastest train runs between Shanghai Pudong International Airport and the city outskirts. As it glides along the track, LED screens in the carriages show the speed tick up to as much as 431km an hour (that's 268 miles per hour). A return journey costs £7.50. That's less than the price of a peak-time London Underground ticket.

By contrast, one of Britain's high-speed trains, the Virgin Pendolino, travels from Birmingham to London at about 200km an hour (or 125 miles an hour).

When it comes to high speed rail, China is thinking big. By 2020, all major cities in China will be connected by trains that run at 350km an hour. Beijing is investing $300 billion upfront. The World Bank described the project as "the biggest single planned program of passenger-rail investment there has ever been in one country".

The rest of the world is now playing catch up. Billions of dollars are being poured into high speed rail – and just a handful of companies are equipped to scoop it up.

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Wellard awarded Queensland Rail tender

Wellard Technologies has been awarded the tender to install and test wireless technology for a Wi-Fi trial of Queensland Rail’s Brisbane passenger train network.

Under the terms of the contract, Wellard will conduct an initial Wi-Fi test on board one carriage of a Queensland Rail City Network train to map the coverage capabilities of the vast network.

Wellard was one of three companies, in addition to Dimension Data and Fujitstu, shortlisted for the project back in June.

At this time, Transport Minister Rachel Nolan said the project's primary focus was to provide wireless coverage to city trains, to allow streaming coverage of onboard CCTV cameras and ultimately additional benefits to passengers including WiFi access.

"The priority for us is to have the network set up, and streaming CCTV implemented,” Nolan says.

Wellard, which has offices in Brisbane and Perth, has previously worked for the Queensland Government to design and deploy control technologies to improve throughput at the Dalrymple Bay Export Coal Terminal.

Communications Technologies Manager Damian Bryant (pictured) says Wellard has been through a rigorous tender process before being awarded the Queensland Rail contract.

“The combination of the leading edge and robust technology Wellard Technologies could offer and the company’s history of performance and delivery were integral in securing the contract,” Bryant says.

He anticipates Wellard’s nomination as the preferred vendor for the Queensland Rail contract will generate additional business development opportunities for the business.

Wellard will deploy technology from Nomad Digital to run the trial.

Australian market continues to grow: Rail Europe

Rail Europe CEO, Pierre-Stephane Austi was in Sydney yesterday to celebrate the fact that more Australians are travelling by train in Europe than ever before.

Rail Europe sales are up 63 per cent in Australia, while global sales have also increased by 41 per cent.

“We attribute these extremely pleasing results in Australia to our distribution networks, marketing initiatives and advanced technology that have allowed more clients access to cheaper fares and the advantages of ticketing in Australia,” says Mr Austi.

“We believe that the Australian market will continue to grow – especially with the strength of the Australian dollar combined with the ease of booking and access to the fantastic range of fares that we can offer,” said Richard Leonard, Rail Europe Manager Australasia.

“[Travellers] are shifting more and more from air to rail."

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