Eurostar lobbies Railtrack and Eurotunnel for cuts in charges as it misses passenger targets
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.EUROSTAR, the cross-Channel rail operator, is seeking a reduction in the access charges it pays Railtrack and Eurotunnel after conceding that it may not hit its target of break-even by 2005.
When the company's track charges were set in the early 1990s it was estimated that Eurostar would be carrying 12 million to 13 million people a year on its London-Paris and London-Brussels services by now. This year it will carry about half that number and only expects to handle about 7 million passengers next year.
Gordon Bye, Eurostar UK's new managing director, said yesterday that losses this year were only likely to fall by about pounds 20m to around pounds 75m whereas the previous year they fell by a half from pounds 200m in 1997.
In the third quarter, passenger numbers rose faster than revenues, reflecting increased competition with the low-cost carriers which have added 40 per cent to capacity on the London-Paris route.
Eurostar's finances have also been hit by economic slowdown in the UK, which accounts for nearly half its passengers. This has reduced yields per passenger and resulted in it offering cheap fares such as the current pounds 45 day-return and a special pounds 29 "nightclubber" deal which involves travelling out in the evening and returning before 10.00am the next day.
Mr Bye said that as competition intensified it would become "extremely difficult" for Eurostar to achieve break-even within five years. He said Eurostar had "started a debate" with both Railtrack and Eurotunnel about the level of access charges - which account for about half its operating costs.
Mr Bye also said Eurostar had held informal discussions about the possibility of tieing up with one of the world airline groupings that have been formed. One option would be a link-up with Oneworld, the alliance led by British Airways, which also has a 10 per cent stake in Eurostar UK. However, the state-owned French railway SNCF, which owns a 35 per cent stake in Eurostar, might prefer a tie-up with Air France.
Eurostar's revenues reached pounds 298m in the first nine months of the year - a 6 per cent improvement on the same period a year ago and Mr Bye said he expected a similar rate of growth next year. Operating 31 services a day from Waterloo, Eurostar carries 60 per cent of all rail and air traffic on the London-Paris route and 50 per cent of the lucrative business passenger market.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments