The privately funded rail operator, NTV, has launched its service in Italy over the last couple weeks.  The operator, part owned by Ferrari, will be the first private high speed service in Italy, and is an exciting development in the almost exclusively government funded rail industry in Europe.

Public structure of European rail

Up until this point, and certainly up until the deregulation of the rail market in 2010, the vast majority of rail travel was done on trains that were, in general, government owned organzations.  The key exception to this was in the UK, where the privatization of the rail network was part of the Thatcherite movement towards privatization in the 1980s, but I digress.

For example, the trains in France are generally owned and run by SNCF, the goverment funded rail service, similarly in Germany (DeutscheBahn) and Italy (TrenItalia).  There are some joint ventures in place, such as Thalys, but they tend to be joint between the national carriers in the countries in which they operate.  Thalys, for example, is owned 62% by SNCF (French), 28% by SNCB (Belgian), and 10% DeutscheBahn (German).

Deregulation of European Rail

However, in 2010 the European Commission deregulation of the market came into effect, not only making it possible for the national operators to run trains across borders (for example the intended DeutscheBahn train to London), but also opening the doors to private rail operators.

NTV, which is funded by a variety of private funders, and 20% by SNCF, will be the first majority private funded operator to attempt to take advantage of the deregulation by offering high speed services between 9 major Italian cities.  They have also announced intentions to run trains through Austria to Germany, which would be a very interesting development.

Future of privitized rail operators

The entry of NTV into the market is an extremely interesting development, and we are very excited to see how it develops over the coming years.  There are a few other privitized rail operators in the market or getting into the market as well (including the Los Angeles to Las Vegas "Las Vegas Railway Express" train in the US, all the franchises in the UK as well as the commuter line, Fertagus, in Portugal).  However, one consistent trend tends to be the separation of responsibility for laying the track and operating the trains.

As long as that responsibility remains distinct, I see a strong future for the private train operator, on select routes, particularly when focused on the premium product of high speed rail. We will be following the developments in Italy with fascinated anticipation over the coming years.