Hungarian railway. Photo: Maxpixel

‘European Commission safeguarded competitive pricing of rail’

By blocking the merger of two railway giants Siemens and Alstom, the European Commission has safeguarded the increasingly competitive pricing of rail transport. This was stated by the European Rail Freight Association (ERFA). Attractive prices are important to support the shift to rail and therefore the reduction of CO2 emmissions in freight transport, the interest group said.

On 6 February the European Commission decided to prohibit the proposed merger of Siemens Mobility and Alstom. The decision means that the two companies will continue to work separately and the proposed new EU railway champion will not be established to compete with Chinese manufacturers, as the main aim was argued to be.

Next step

“ERFA supports the idea of having a strong European railway manufacturing sector In order to protect this industry against unfair competition” the group said. Carole Coune, Acting Secretary General of ERFA: “We applaud the decision of Mrs Vestager to reject the Siemens-Alstom merger in her role of guardian of the Treaty and its competition rules. Such a merger would have increased costs for the European industry at a time when railway undertakings are redoubling their efforts to achieve excellence.”

However, the Commission must as a next step ensure there is real market access conditions reciprocity”, the organisation said. “We need a Commission which goes ahead with the enforcement of the rules that benefit customers, making rail travel cheaper, safer, more qualitative, more accessible and less susceptible to tax subsidies. In achieving climate change goals, it is crucial that this policy remains a priority.”

Success story

Rail is now considered as an affordable alternative to road transport. Freight and passenger market success stories have demonstrated that the European competition model is benefitting customers, ERFA continued. “In countries where there is a market share of alternative operators, rail volumes have grown considerably, e.g. the Netherlands, UK, Sweden, Germany.”

Other success stories include a modal shift for commodities as cereal, food product, wood and aggregates, more affordable rail products and implementation of innovations such as quieter wagons and communication systems for customers, the group argued. “This progress has been made possible by the constant attention of the Commission in respect of competition regulations.”

Also read:

European Commission blocks Alstom-Siemens merger

Author: Majorie van Leijen

Majorie van Leijen is editor of RailFreight.com, online magazine for rail freight professionals.

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