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Can HSR transform the global economy?

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  • 5/26 Wall Street Journal
    Published Wednesday, May 26, 2010, by the Wall Street Journal Making High-Speed Tracks Can rail once again transform the global economy? By Christian Wolmar
    Message 1 of 1 , May 25, 2010
      Published Wednesday, May 26, 2010, by the Wall Street Journal

      Making High-Speed Tracks
      Can rail once again transform the global economy?

      By Christian Wolmar

      Building a high-speed rail line between London and the North of England was one of the few policy areas on which all three of the main political parties agreed during the recent U.K. election campaign. That was a complete turnaround from the previous election when the subject was barely mentioned and none of the parties were supportive. British politicians now realize the U.K. is lagging behind the rest of the world on building high-speed lines. Even the U.S. is getting in on the act.

      The U.K. plan is for more than 300 miles of new line linking the three largest provincial cities -- Birmingham, Manchester and Leeds -- with London on a Y-shaped network that would cost upwards of £30 billion ($45 billion) to build.

      Andrew Adonis, the transport minister in the outgoing Labour government, thinks the focus on high-speed lines demonstrates a change in the way that transport problems are addressed. "The most important aspect of the high-speed decision is that the next generation of transport capacity between our major conurbations will be rail capacity and not either road capacity or aviation," Lord Adonis told The Wall Street Journal Europe. "That is one of those transformational moments in transport policy." Such thinking is bringing the UK into line with most of Europe and parts of Asia.

      Dedicated Lines

      The first high-speed line was the Tokaido Shinkansen between Tokyo and Osaka, completed in 1964 for the Olympics that year. These early trains ran fairly slowly by today's standards reaching just 130 miles per hour compared with current speeds of 200 mph on the French TGV Est. But crucially the service was on dedicated lines with no other traffic, creating a fast and reliable service. Its development -- as with the first European service, between Paris and Lyon that opened in 1981 -- was stimulated by the need for extra capacity as much as the desire to go faster. Building a new line that can accommodate trains running at 200 mph is not much more expensive than constructing conventional track.

      While there were a few developments in the 1980s, with Germany joining the high-speed league, it is only really in the past twenty years that the concept has spread around the world. Countries as diverse as Taiwan, South Korea, Russia and Turkey have been building lines. In Europe, Spain recently overtook France as the country in the region with the largest high-speed rail network. China is by far the world leader.

      When large sections of European airspace were closed in April this year, hundreds of thousands of people discovered that high-speed rail is a genuine alternative to short-haul flights. Eurostar -- which operates services through the Channel Tunnel from London to Paris, Brussels and several other destinations -- ran more than 70 extra 700-seat trains during the crisis.

      The time savings that result from the construction of a new high-speed lines are remarkable. In the 1960s, the Tokaido Shinkansen reduced the time for the journey between Tokyo and Osaka from seven hours to four. The same trip now takes just under two and a half hours. On the much more recently built Madrid to Seville service, the journey time is just two and a half hours compared with more than six previously. These reductions make rail a realistic proposition for business travellers. The conventional wisdom is that passengers prefer rail journeys of up to three hours over flights -- train stations are generally located in city centres and the total journey time is therefore likely to be around the same. The recent proliferation of security checks at airports, along with the fact that many trains now how have Internet connections, is changing the balance of power towards air from rail.

      "The High Speed Revolution," a report produced in March for the U.K. government, found that "the railway's share of the market for travel of up to 800 kilometers can be 50%, and for 500 kilometers as high as 80% to 90%". Indeed, the Paris to Lyon TGV captured more than 90% of trips between the two cities. Similarly, when the Madrid to Seville high-speed line opened in 1992, it quickly obtained an 80% share of the trips between those locations.

      That line was the start of a hugely ambitious program of high-speed rail construction in the Iberian peninsula, which aims to ensure 90% of all Spanish citizens are within 50 kilometers of a high speed rail station by 2020. The country's government is planning to spend €120 billion to achieve this goal.

      Such ambitions are dwarfed by China where the government is pouring around $100 billion a year into the railways, mostly on the high-speed rail network, which is already the largest in the world covering more than 4,000 miles. By 2020, China hopes to have 30,000 miles of high-speed track, as much as the rest of the world put together.

      The scale of ambition in the U.S. is far more modest. The $8 billion stimulus package for the railways announced last year will mainly be spent on preliminary studies. These will look at obvious routes such as those linking the main cities of California or Florida, or improving existing services. The one route in the U.S. that could be called high speed -- the Acela services in the North East corridor -- rarely achieves its potential of 150 mph and the 450-mile trip from Boston to Washington takes almost seven hours.

      Contrast that with China. When the Beijing to Shanghai line is completed next year, the 700 mile journey will take just four hours, with trains reaching 240 mph.

      However, high-speed trains are not a total no-brainer. The biggest barrier is cost. Research conducted in 2005 showed that, on average, high-speed lines cost €18 million for every kilometer laid. That figure could rise to €39 million over the trickiest terrain. Moreover, almost all the money has to come from the public coffers as the rail companies generally only make enough money to cover their operating costs.

      According to the authors of "The High Speed Revolution": "Returns to investment will not normally be strong enough to attract private sector funding, and most projects will only thrive where there is a large market, a substantial public sector commitment, and some degree of network co ordination."

      Standardization Failure

      Creating seamless journeys across Europe is hard because the different lines have different owners. The failure to standardize different ticketing systems and to agree on fare pooling means it is hard to book tickets and fares tend to be high. Indeed, the cost of travel tends to be higher than with the airlines, especially the new generation budget companies such as Ryanair and EasyJet. Rail overheads are high and the industry can suffer from old-fashioned labor practices.

      This was starkly demonstrated when the skies over Europe were closed. Passengers hoping to jump on a train in France found that many lines had been closed by a two week strike of drivers and conductors.

      They were also confronted with exorbitant costs -- tickets for the 240-mile journey between London and Paris cost about £179 one-way for passengers who had not booked in advance.

      Despite these problems, high-speed rail is a growing phenomenon. Nothing illustrates that better than the Chinese ambition to build a high-speed service between London and Beijing, taking just two days to make the journey. It is a fanciful notion which faces fierce difficulties. But the fact that it is even being considered, demonstrates the scale of rail's revival: A 19th century invention has found a role in the 21st century.

      Christian Wolmar is a writer based in London. From 1989 to 1997 he worked at The Independent, mostly as transport correspondent. His latest book "Blood, Iron and Gold, How the Railways Transformed the World," is published by Atlantic Books. He can be reached at reports@...
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