Comparison with the Swiss railway market Bernard Guillelmon, CEO Skyguide business day, 20 November 2017
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1 Comparison with the Swiss railway market Bernard Guillelmon, CEO Skyguide business day, 20 November 2017
2 The BLS Group Passenger transport BLS AG Freight traffic (BLS Cargo AG) BLS AG Canton Bern 55.8% Confederation 21.7% Other 22.5% BLS Netz AG Confederation 50.05% BLS AG 33.4% Canton Bern 16.5% SBB 0.05% Infrastructure management (BLS Netz AG) BLS Cargo AG BLS AG 52 % TFH (SNCF) 45 % IMT 3%
3 Agenda 1 Structure of the Swiss railway market 2 Opportunities for a multi-railway system 3 Risks within the current railway system 4 Vision: towards an ideal model 3
4 Separate markets in the (Swiss) railway system Long-distance traffic: concessioned Regional transport: publicly appointed Freight traffic: open market Open network access Infrastructure: publicly appointed 4
5 Today s Swiss railway landscape: shares of private railways in the standard-gauge network 27% 0% 15 % Regional transport Long distance traffic Infrastructure* * System leaderships and long-term planning at the SBB 32% All figures 2016; sources: FOT, VöV, SBB, BLS s own calculations Freight transit
6 Shares of public subsidies in proceeds Infrastructure Regional transport Long-distance transport 51% 0% 73% Freight traffic 0% All figures 2016
7 Development of the regulatory framework Trend towards further market liberalisation? Separation between infrastructure and transport
8 Agenda 1 Structure of the Swiss railway market 2 Opportunities for a multi-railway system 3 Risks within the current railway system 4 Vision: towards an ideal model 8
9 9 Advantages of a multi-railway system in the Swiss railway market Long-distance transport Regional transport Freight transport Main beneficiaries: passengers Differentiation (service / quality) New service concepts Main beneficiaries: purchasers, passengers Benchmarking (costs / quality) New service concepts Preparing a market opening Main beneficiaries: transport industry Product variety (proportions) Quality (punctuality / service) Decreasing prices Infrastructure Main beneficiaries: overall system, tax payers Benchmarking (costs / systems / organisation models)
10 Agenda 1 Structure of the Swiss railway market 2 Opportunities for a multi-railway system 3 Risks within the current railway system 4 Vision: towards an ideal model 10
11 Target conflict (1) Integrated SBB as guardian of the system : System targets / regulatory targets Assurance of discrimination-free network operation Optimisation of the overall system Entrepreneurial targets / targets of the Confederation as owner Safeguard of market share Competitive gains In today s system, the SBB has every incentive to engage in discrimination.
12 Target conflict (2): political influence and governance of railway companies / example of BLS Owner representation on the Board of Directors (cantons BE/VS) Ordering services Regional rail traffic, infrastructure Strict regulation e.g. technical standards, Working Time Act Specific political expectations e.g. tariffs, regions, working conditions, etc.
13 A dominant, integrated market player has multifaceted possibilities of discrimination. These are often hidden and non-controllable. Possible areas of discrimination: Infrastructure development Train-path planning Access to stations and customer information systems Access to distribution systems and customer data Abuse of market power Internal cross-subsidies of business units by the corporation Political pressure on public authorities
14 Consequences of discriminatory rail operation Lack of cost transparency and lack of a level playing field result in unfair competition. The purchaser s sovereignty is restricted. Less than optimal resource allocation makes the system more expensive. The victims are the passengers, rail freight customers and taxpayers.
15 Agenda 1 Structure of the Swiss railway market 2 Opportunities for a multi-railway system 3 Risks within the current railway system 4 Vision: towards an ideal model 15
16 Clear processes Bottom line (1): the railway system requires a clearcut and transparent separation of roles. Regulator Network operator/ Infrastructure corp. Purchaser/funder Monopoly area: government control System integrator Service provider / RTC 1 Service provider / RTC 2 Service provider / RTC 3 Competitive area
17 Bottom line (2): the roles within the public administration also have to be clear-cut! Regulator System objectives (security, market regulation, etc.) Owners Corporate objectives (profit, positioning, etc.) Purchasers / Financial backers Service objectives (Network expansion, efficiency, etc.) Transport companies
18 Thank you.
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