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Swiss railways sets sights on share of British market

Swiss Federal Railways bid for passenger service franchise in London. SFR

The Swiss Federal Railways has announced that it is to bid for a share of Britain's privatised rail market. The company is trying to secure a franchise to operate passenger services in London.

This content was published on September 1, 2000 - 15:51

The Federal Railways announced in London on Friday that it was teaming up with two British partners to bid for franchises for passenger train services south-west of London. Total Swiss investment could be up to SFr200 million ($114 million).

The partners are John Laing Investments and the M40 Trains company. The three companies have already signed a pre-bid contract for the "Thames and Wessex" franchises

If the bid succeeds, the Swiss would take a 50 per cent stake in M40 Trains. That company is the owner of "Chiltern Railways", and has for five years operated a 270 kilometre- (168 mile-) network between London's Marylebone station and the Britain's second-largest city, Birmingham.

"It's very exciting for the Swiss Federal Railways," spokesman Christian Kräuchi told swissinfo. "It's also fascinating if you look at history. British engineers were responsible for building the Swiss rail system with help from British capital. Now we're very proud that we can take some of our knowledge back to the home of railways," he added.

The planned expansion into Britain underlines the Federal Railways' long-term intention of becoming a leading passenger railway company in Europe. The directors say the Swiss rail market is largely saturated, so the company can only grow by expanding abroad.

They also want to play a leading part in European Union efforts to liberalise passenger rail traffic.

The Federal Railways says it has chosen two strong partners for the franchise bids. John Laing Investments is a subsidiary of the John Laing construction company and has an 84 per cent stake in M40 Trains.

"In customer surveys, Chiltern Railways has come out on top as the best railway company in Britain," Kräuchi told swissinfo. It has a good reputation, and we think that the three partners together can put up a good offer."

The Thames franchise covers a network of 584 kilometres (363 miles) with 70 stations, while the Wessex franchise has a network of about 805 kilometres (500 miles) with 235 stations. An important part of the Wessex franchise is a link to London's Gatwick airport.

If the Strategic Rail Authority, which is responsible for granting the franchises, comes out in favour of the British-Swiss team, the companies expect major gains in savings and efficiency because the Thames and Wessex franchises border Chiltern's network.

The contract with the Federal Railways is particularly interesting for the two British partners because of Swiss know-how in running an integrated operation. The Federal Railways are responsible for both the infrastructure and running of trains in Switzerland.

"We have a long tradition of running a very dense network and we have the most trains per train kilometre in Europe," said Kräuchi.

The Swiss transport workers' union criticised the project as an "adventure", and said it considers the move a strategic and economic mistake. In a statement issued after the announcement by the Federal Railways on Friday, the union said the risks exceeded the potential gains.

It called on the Federal Railways to consolidate partnerships concluded recently with the Italian, German and Austrian rail companies before seeking a further expansion. The union warned it would fight against the project.

by Robert Brookes

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