Why now
Regulatory reform
In the 1970’s and 80’s, airlines were deregulated and market forces were allowed to take over. This has since led to the expansion into the current industry we see. This took many years to fully develop, and it would have been very hard to see what it would result in at the time.
Nobody had predicted that Ryanair would become Europe’s largest airline, or that the new jumbo jets would fall out of favour.
Now the European Union is liberalising and opening up the rail market. This has happened through many legislative efforts and is still ongoing, but the results are starting to show. Competition and open access on intercity rail lines, allowing for innovation.
This regulatory push is not yet over, some operational limitations are still present, the regulatory environment is still not the same between countries, and some national infrastructure managers still favour national champions.
Hence another smaller part of our business will not be political lobbying, built building the narrative around night trains. Accomplishing future legislative goals via public support, which also directly doubles up as marketing for our services.
Business investment
There already are private railway companies that carry passengers in Europe, ranging from High-speed operations, new night trains, to budget railways. All of these are just in their infancy, and the businesses supporting them are only just getting started.
With the investment of MSC into Italo/NTV, along with multiple new startups aiming to compete in high-speed markets. The grand revival of night trains on the continent. This is likely to be a moment similar to the 80’s and 90’s for aviation.
Now is the time to enter the market.
Infrastructure
The regulatory context is only a part of the external environment that needs to be there is the infrastructure. Even more so than for planes, if there are no tracks, there is no service.
HSL’s
While airports are needed to land for planes, they only need to exist at the origin and destination, for a train tracks need to be laid on its entire route. Not just any tracks the right ones.
The European high-speed railway network is the second largest in the world behind China’s. But the EU’s TenT program is extending the network, between cities, and more importantly between countries.
The rationale for expanding the network even further only grows every day, and with the increase of operations and capabilities provided by our company in the future, most current plans will seem small and incomplete.
Signalling / gauge / electrification
Not just the tracks need to be present, but also the right signalling system, here once again the EU has done the groundwork. Establishing standards that countries can then implement.
All of the high-speed lines in Europe are built on the same track gauge (width), so we will not develop gauge-changing bogies
Finally, when it comes to electrification, trains that can take different voltages and currents are now widely available, so technology has made cross-border trains on the continent possible in the last 2 decades.
