Following our first episode on the privatisation of the British railways, our series on the opening-up of the sector to competition continues this week with a spotlight on the freight industry in France. Because while trains may usually be considered a means to get humans from one place to another, they are clearly also a way of conveying goods too. So let’s climb aboard and slot ourselves in besides the factory products and girders.
The opening-up of freight to competition started nearly 20 years before that of passenger transport, which we’ve spoken about at length in Midnight Weekly. In 2003, a European directive in fact required members of the EU to open it up to international business. The following year, a subsidiary of Eurotunnel was the first business without any link with SNCF to obtain a railway licence. In 2005, the CFTA-Cargo business, a subsidiary of transport group Connex ran its service between Dugny-sur-Meuse, dans in the La Meuse department, and Völkingen, and in the German Sarre area, home to lots of steelworks. The operation was underway.
A new European directive was adopted in 2006. This time, lines within France were opened up to competition too. Within a few years, more than 20 private operators – including ECR and Europorte, under the control of Deutsche Bahn and Eurotunnel respectively – started taking their share of the market away from SNCF. In fact, they soon represent 40 percent of the market. It’s a heavy blow for the public operator, for whom freight had always been hugely profitable. It has, however, managed to rent 50 percent of the market even today.
But the opening-up didn’t go all that smoothly. In 2016, it came to light that the prices for French freight transport were far lower than those of other European countries, despite the EU requirement for fair prices that take into account real costs. The result? The French state progressively reduced its financial backing for the sector. That meant the tolls for the latter will increase by 4.6 percent per year between 2018 and 2027. That’s an increase of 56.8 percent in a decade, without accounting for inflation..
Though a direct link can’t be drawn with this decision, the freight industry has since entered a very real period of decline. While it still accounted for 30 percent of the transport of goods in 1984, today the proportion is more like 9 percent. Thus, in 2019, French trains carried 89.3 million tonnes of goods, including 25.5 million tonnes from one country to another. And that’s a real catastrophe, in lots of ways. When it comes to freight transport, rains are less polluting, less noisy and less dangerous than lorries. One of the main issues is the ‘final stretch’, that is, the transportation of goods from the train to the final destination, which often takes place by van, in any case.
The French state is well aware of the problem and aims to reinvigorate the freight industry. In 2020, the government thus put in place a national strategy with 72 concrete policies, all the result of a long consultation with major industry players. The latter have signed a development agreement named Alliance 4F, for Fret Ferroviaire Français du Futur (French Freight Railways of the future). There are three main aims: make freight railway transport attractive, trustworthy and competitive; act upon all the evident potential for growth of the freight railway industry; and pursue the modernisation and development of the network. Which should keep them going a little while. They hope to help the industry regain 18 percent of the goods transport market in the years to come, and 25 percent by 2050. For the good of the French rail industry, let’s hope it works.
