Italy launches private high-speed train

Apr 22, 2012 by Ljubomir Milasin
An Italo train run by NTV (New Passenger Transport) at Rome's Tiburtina station. Italy launched Europe's first private high-speed train service this week, in competition with state network Trenitalia.

Italy launched Europe's first private high-speed train service this week, as the country looks towards the more liberal economy that Prime Minister Mario Monti wants to put on the rails.

The dark-red bullet-shaped "Italo" trains are run by NTV, a company headed by Ferrari boss Luca di Montezemolo who wants to take a quarter of the market from state rail network Trenitalia, the biggest employer in the country.

"Italo has arrived, the competition has kicked off," NTV told its first passengers on an inaugural trip from Rome to Naples as they admired interiors that included a cinema carriage, leather seats and panoramic windows.

The project is one example of the new ambitions of the eurozone's third largest economy under Monti, a former EU competition commissioner who plans to shake up a sluggish economy heavily influenced by protectionist traditions.

Economics professor Monti came to power in November replacing Silvio Berlusconi and has said he wants to take on "vested interests" as well as calling for large-scale privatisations.

"We're talking a lot about growth. This is real growth for the country by someone who invests and takes a risk," Montezemolo told reporters, pointing out that the company had invested one billion euros ($1.3 billion).

"We should be proud of being the first in Europe with a private company," said the entrepreneur, who has struggled for years to get the project up and running, condemning Trenitalia for its obstructionism.

"This is a day that shows we have confidence in our country," he said.

France's national rail company SNCF owns a 20-percent stake in NTV but the majority is held by a consortium of Italian businessmen including Montezemolo and Diego Della Valle, the billionaire head of luxury shoemaker Tod's.

The carriages are produced by French company Alstom.

"Our aim is to take a 20-25 percent stake of the market by 2014," transporting nine million passengers within three years, Montezemolo said, adding that the company would operate 25 trains by January 2013.

"Consumers have already benefited from the beginning of competition. Trenitalia has lowered its ticket prices and improved the service," Marco Ponti, a professor of transport economics in Milan, told AFP.

"Italo" hopes to gain a competitive advantage with a system offering passengers cut-price tickets by booking early or travelling at off-peak times.

But Ponti warned that the nascent competition may be too "uneven."

"This is a dwarf against a giant. Trenitalia owns the railway, the stations, the waiting rooms, everything," he said.

"The economy is not very favourable with the crisis," he said, adding: "Montezemolo can go bankrupt, Trenitalia can't. It's a state company."

Italy's economy entered recession in the second half of last year and the government this week warned that the situation will worsen, with a forecast contraction in gross domestic product (GDP) of 1.2 percent this year.

Ponti warned that the economic outlook could bring Trenitalia and NTV together with a deal "that would destroy healthy competition."

"What we need is a third player," he said.

The head of Trenitalia, Mauro Moretti, played down talk of a bitter rivalry saying this was "a new, unique challenge ... in the interests of our clients."

Explore further: EU Parliament votes to break up Google

add to favorites email to friend print save as pdf

Related Stories

Japan to launch 'Hayabusa' bullet train

Mar 04, 2011

Japan's latest bullet train, the thin-nosed "Hayabusa" or Falcon, will make its 300 kilometre per hour (186 mph) debut Saturday, boasting a luxury carriage modelled on airline business class.

France's SNCF hopes to run high speed rail in US

Mar 20, 2009

The United States is ready for a truly high-speed rail system and France's national railway SNCF would be "very interested" in operating a network, a senior executive said Thursday.

Nokia share price plummets as it lowers outlook

May 31, 2011

The world's top mobile phone maker Nokia on Tuesday downgraded its second quarter outlook, saying sales would be far lower than expected and that it could no longer give a full-year forecast.

Britain feels heat of NTL's Virgin buyout

Apr 04, 2006

Getting more services for less money. That could well be what many British customers will be getting if NTL's buyout of Virgin Mobile works out as planned as they propose to offer mobile, fixed-line, broadband, and television ...

Recommended for you

EU Parliament votes to break up Google

Nov 27, 2014

The European Parliament voted overwhelmingly for the break-up of Google Thursday in a largely symbolic vote that nevertheless cast another blow in the four-year standoff between Brussels and the US Internet ...

Toyota finds new air bag issue, recalls more cars

Nov 27, 2014

Toyota Motor Corp. recalled more than 40,000 vehicles in Japan on Thursday as part of a worldwide scare over defective air bags and is investigating a new type of air bag problem that could lead to further recalls.

Netflix sues Yahoo CIO for alleged kickbacks

Nov 26, 2014

Netflix is suing a former company vice president who is now chief information officer at Yahoo, accusing him of receiving money from vendors he hired to work with the video streaming company.

User comments : 2

Adjust slider to filter visible comments by rank

Display comments: newest first

Paul_Gracey
5 / 5 (2) Apr 22, 2012
Here is what this "private" High speed train is probably not doing. It is most likely not running on its own rails, but using the right-of-way of its Public competitor for which it does probably pay for the privilege, but only its 'cherry-picked' share. Its funding is partly from a publicly owned railroad in France, and its equipment manufacturer depends on subsidized railroads world wide to remain in business. Do I support the basic idea of challenging publicly owned railroads with service improvements from competition? Yes, but lets be certain of our terms.
bg1
5 / 5 (1) Apr 22, 2012
'Privatization' = Privatize the profits and socialize much of the cost and risk.

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.