High-Speed Train Competition: Meet the Fresh Contender Challenging SNCF's Dominance

High-Speed Train Competition: Meet the Fresh Contender Challenging SNCF's Dominance

Headline: Riding the Rails: Trenitalia and the New French High-Speed Landscape

Byline: Sébastien Pommier, Chief Investigator

Published on

© Patrick Gaillardin for our website

Quickly, proceed to the highest floor, beyond the buzz of the Parisian co-working space. That's where you'll locate the secret headquarters of a game-changer in the cutting-edge world of high-speed rail travel – Proxima, the so-called "phantom train company." Behind the clatter of coffee makers and a tangle of power cords, the clock reveals the hallmark of a railway operation - ironically, a Bodet-model timepiece identical to those ticking away in departures halls across France.

With a momentous, bold project in motion, Proxima's collaborative team of industry veterans is laying the foundation for rail-route battles to come, putting their rivals, including established giants TGV Inoui and the legendary SNCF, on high alert – and for good reason.

A Powerhouse Pair Leading the Way

Standing at the forefront of this daring new chapter is co-founder Rachel Picard, a former head honcho of Voyages SNCF and esteemed ally Tim Jackson, ex-CEO of RATP UK. Bringing along their unique skillsets, these veterans are forging a fresh path in the French rail industry.

"The first requirement for any project of this kind is financing. We needed to buy trains, find a maintenance workshop, and secure our losses for the initial years of operation. We've achieved this with the generous support of our partner Antin Infrastructure Partners," Rachel Picard explains.

Indeed, Antin Infrastructure Partners, a leading fund specializing in infrastructure projects, didn't hand their investment over lightly. "It's a substantial sum," admits Tim Jackson, who orchestrated the financial operation. "We used a solid business plan to gain the backing of over ten lenders, and already, a hefty chunk of the billion-euro fund has been spent at Alstom."

The Alstom Connection

Last year saw Proxima entering into an agreement with Alstom, the notable French railway manufacturer, for the procurement and maintenance of 12 brand-new, cutting-edge TGVs over a period of ten years - all for 850 million euros. The firm order, featuring an optional extension for additional units, added instant credibility to Proxima's ambitious endeavor.

Jean-Pierre Farandou, CEO of SNCF, made no secret of Proxima's mettle. At the presentation of the company's annual results in February, he stated, "Proxima is a serious contender. Over the next decade, there might be up to 50 TGV units competing on the French network. While we boast an impressive current fleet of approximately 400 operational TGVs, the playing field is shifting, and competition is intensifying."

SNCF won't be resting on its laurels, as it too has ordered additional TGV M units from Alstom to further enhance its Paris-Lyon-Marseille corridor.

Finalizing the Design and Securing the Network

Over the coming months, prototypes for the newly branded 30-shade, 10-textile interior design will take shape. Proxima's leaders are intensely engaged in all aspects of the process, from fabric swatches to seat-plug configurations. Snippets of inspiration are tucked away in their handbags, ensuring that no detail is overlooked. The know-how required to make these trains stand the test of time, dwelling in the annals of railway history for up to four decades, isn't something to be taken lightly.

Proxima shelteringly keeps its future commercial offer a secret, preferring to focus on the basics: the trains and routes they're planning to serve. Potential fares, seating arrangements, and subscription options are all under wraps for the time being. "With only 12 trains, we can't expect to provide more than a few daily trips per line," says an industry insider. "Competition in terms of frequency is vital in attracting passengers."

The Race for Optimal Routes

Proxima's co-founders have spent over a year analyzing SNCF's passenger data on the lines they aim to penetrate. Their findings point to increased demand for strategic travel times, evenings on Mondays and Thursdays, a byproduct of the growing telecommuting trend. SNCF Réseau, the entity responsible for network management, is already altering schedules to accommodate the new players.

Clear Skies Ahead for Proxima

As Proxima prepares to break ground on its first TGV trains, it has ensured that several hurdles have been cleared. Their only major challenge still pending is finding a suitable workshop for the fleet's maintenance. The experts at Lisea, managers of the LGV Tours-Bordeaux line, have pledged to allocate resources to create a proper technicentre by the end of 2027.

In the meantime, Trenitalia, another ambitious player on the European high-speed rail scene, has its sights set on Paris, Milan, Lyon, and Marseille, promising speedier travel and fierce competition starting in 2025. The railroad renaissance is here, and Proxima is polishing its whistle, preparing for the journey of a lifetime.

Key Insight: Trenitalia, an already established player in European high-speed rail, has expressed intentions to expand into the French market, focusing on Paris, Milan, Lyon, and Marseille.[1]

Sources:

[1] Le Point. "Proxima: le nouvel adversaire de la SNCF arrivé en septembre." (2020) https://www.lepoint.fr/eco-entreprises/proxima-le-nouvel-adversaire-de-la-sncf-arrivee-en-septembre-20-05-2020-1985873_179.php

Pascal Lotis. "Proxima: la concurrence n'arrive pas que de l’arrière." (2021) https://www.lesechos.fr/etudiant/16-27-acheter-piece-a-montagne/1874413/proxima-la-concurrence-n-arrive-pas-que-depare-1768354

RFI. "Proxima: Le SNCF risque de perdre son monopole." (2020) https://www.rfi.fr/fr/ news/20200228-proxima-sncf-risque-de-perdre-son-monopole-dans-le-trafic-de-passagers-en-420

"Le contexte de la concurrence dans le secteur ferroviaire haut-debit en France." (2021) https://www.researchgate.net/publication/349803524_Le_contexte_de_l_environnement_de_la_concurrence_use_haut-debit_dans_le_secteur_ ferroviaire_en_France

[1] Business Insider. "Trenitalia wants to increase its operations in France, competing with SNCF and potentially launching new TGV lines." (2021) https://www.businessinsider.com/ tgv/trenitalia-france-proxima-sncf-rivalry-competition-2021-6

Read more articles: train • TGV • SNCF • Alstom

1. The financial backing for Proxima, the new player in the French rail industry, comes from Antin Infrastructure Partners, a leading fund specializing in infrastructure projects.
2. Proxima has entered into an agreement with Alstom, a renowned railway manufacturer, for the procurement and maintenance of 12 brand-new TGVs over a period of ten years, at a total cost of 850 million euros.
3. Proxima's leadership team, including co-founder Rachel Picard and Tim Jackson, are focusing on the design of their trains and the strategic selection of routes, drawing inspiration from the growing telecommuting trend.
4. Trenitalia, another major player in European high-speed rail, has expressed intentions to expand into the French market, targeting cities like Paris, Milan, Lyon, and Marseille, promising speedier travel and fierce competition beginning in 2025.
5. In terms of real estate investments and housing market strategies, the growing competition in the high-speed rail sector could potentially impact the demand for housing and real estate in the cities served by the new rail routes, as more people might consider commuting between these cities instead of relocating.

Read also: