IN AVIATION the arrival of privately owned low-cost airlines has shaken up the market and sent the traditional flag carriers into retreat. But in Europe’s railway business there is still little competition in passenger services. Even in freight, where there ought to be more scope for rivalry, the market is still dominated by state-owned incumbents. The European Commission’s “Transport 2050” plan, adopted two years ago, promises to get half of all the continent’s medium-distance goods transport off the roads and on to rail (or water) by 2050. But although some progress has been made in designating cross-border rail “corridors”, the plan will not get far unless there is more choice and competition.Newer, private rail-freight firms complain that their attempts to get into the market are frustrated by the incumbents. Laszlo Horvath, president of CER Hungary, complains that the state-owned giants, which usually own the tracks as well as running trains, turn nasty whenever young private firms like his try to expand.In January the commission launched its “fourth railway package”, intended to create a single European rail market—clearly the first three were not enough. It requires the incumbents to separate, financially and operationally, the part of their business that runs trains from the bit that owns and maintains tracks and signals—although they can still belong to the same…
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