High Speed rail lines making a loss

According to a new report released today by the Spanish Foundation for the Studies of Applied Economics (Fedea), none of Spain’s high speed AVE train lines are making a profit. The report claims that the huge investments made by the government that run to billions of euros are “neither beneficial to businesses or society” and don’t compensate for savings made in flights or driving time.

Spain currently has more than 2,515 kilometres of AVE rail lines, with another 1,200 kilometres being built at the moment – this is one of the most extensive rail systems on the planet, but Spain currently has a relatively low demand for high speed rail travel.

The report determines that in Spain there were only 11,800 passengers for every kilometre of AVE line in Spain, compared to 158,121 passengers per kilometre in Japan, reflecting the much higher train usage in the Asian economic superpower. The report goes on to say that although numbers of train passengers are projected to increase rapidly in the next five years, only an increase in ticket prices to customers will recover the cost of investment.