SNCF competition: Panorama of the French railway landscape

Since the opening of the French rail market to competition in 2020, we have observed a significant change in the rail transport landscape. Initially monopolized by the Société Nationale des Chemins de fer Français (SNCF), the sector is now experiencing the entry of new players determined to offer alternatives in terms of services and prices. These competitors come from various European backgrounds and position themselves specifically on high-speed lines, as well as on other less profitable lines, where SNCF was in a strong position.

The arrival of companies like Trenitalia and Renfe on the market marks an important step in the history of rail transport in France. Users are at the heart of this reform and can now benefit from a greater variety of services, which could result in more competitive offers, both in terms of cost and quality. Furthermore, this opening to competition is intended to be a lever for innovation and the improvement of railway infrastructures.

History of SNCF competition

Competition in the French railway sector was an idea long debated before its effective implementation. We observed the beginning of this transformation with the opening of rail freight to competition and international lines in the early 2000s.Key steps:

• 2000s: Start with freight and international lines.
• End of 2020: Opening to competition from French passenger lines, with the possibility for the regions to initiate calls for tenders.

Law No. 2009-1503 already defined a timetable for competition in Ile-de-France rail transport services. However, the monopoly of SNCF and RATP remained in force until the end of 2039. This transition period aimed to prepare for the opening of the market to new operators, allowing gradual evolution.

Today we are witnessing a changing railway landscape, marked by the arrival of competitors such as Trenitalia and Renfe, who are particularly interested in the development of TGV. This diversification of the offer aims to stimulate innovation and improve services to travelers.

Legal and regulatory framework

Here we address the regulatory foundations that structure the rail market in France, including the end of the SNCF monopoly and the impact of regulations at national and European level.

National laws

National reforms have ratified the end of our state monopoly on French railway lines. Since January 1, 2020, we have been subject to the legal framework which opens passenger rail transport services to competition. This transformation stems from the desire to revitalize the sector and improve the offer offered to users.

European directives

Our rail market is also governed by European directives. The objective is to achieve openness full competition for all rail passenger services by 2039. This legislative harmonization aims to create a unified European railway area, thus boosting competitiveness and innovation in the sector.

Impact on the rail market

The opening of the rail market in France to competition has led to significant changes for both consumers and historic operators. We will examine the benefits as well as the challenges associated with this evolution.

Benefits for consumers

• Wider choice: With the arrival of new players like Trenitalia on routes like Paris-Lyon, passengers benefit from a wider range of travel options.
• Competitive prices: Competition between railway companies tends to lead to lower prices, which can result in more accessible prices for train users.

Consequences for incumbent operators

• Mandatory adaptation: Historic operators, such as SNCF, must innovate and improve their efficiency in order to remain competitive with new entrants to the market.
• Review of commercial strategies: It is crucial for incumbent operators to review their commercial strategies to maintain their market share and effectively respond to traveler demand.

Services concerned

As part of the opening to competition of rail services in France, certain services operated by SNCF are affected. We will detail the changes planned for the TGV, TER, and Intercités.

TGV

The TGV (High Speed ​​Train) is one of our emblematic services impacted by competition. Currently, other operators such as Trenitalia have launched competing services in France, offering alternatives on international and domestic routes.

TER

The TER (Regional Express Trains) are managed in collaboration with the regions and they can choose to use alternative operators. The first competitive tenders are underway, opening the door to new offers and possible improvement of the service.

Intercity

As for Intercity trains, which provide interregional connections, they are also the subject of attention in this competitive context. Our strategy and our offer will evolve to maintain our quality of service in response to this new market situation.

Competing players

In the railway sector in France, competition from SNCF is intensifying with the arrival of new operators and the formation of consortia. These players aspire to redefine the rail transport landscape.

New rail operators

Within France, several companies have taken the plunge to position themselves against the SNCF. Among them, we find Trenitalia</ a>, which entered at the end of 2021. The Spanish Renfe also became an operator on French routes. These companies aim to offer alternatives on high-speed lines.

Consortia and partnerships

Faced with the opening of the market, strategic alliances are being formed between operators. These consortia can significantly influence the market by combining their resources and expertise. For open markets such as TER or INTERCITÉS, the regions and the State can organize calls for offers, opening the door to these new collaborative configurations. Competition is thus increasing, with players seeking to carve out a share of the French rail network.

Challenges and perspectives

We are facing an evolving market with the opening to competition in the railway sector. This requires us to continually invest in innovations and in-depth reflection on our ecological impact.

Technological innovations

We invest in the latest technologies to improve our services and operational efficiency. The adoption of intelligent traffic management systems and the integration of big data are essential to optimize our routes and schedules. Faced with competition, the emphasis is placed on solutions such as electronic ticketing, which simplifies and accelerates access to travel.

Sustainability and ecological issues

Our commitment to sustainability is stronger than ever. We are implementing strategies to reduce our carbon footprint, such as renewing our fleet to include low CO2 emissions trains. In addition, we work closely with local communities to develop greener transport offers, consolidating our role in the fight against climate change.

Statistics and key data

We observe a multitude of statistics and data allowing us to understand the performance and challenges of the SNCF. In terms of turnover, SNCF is among the leading global rail transport companies. SNCF’s key figures reveal the importance of this company in the transport sector in France and around the world.

• Everyday transport: Every day, we transport nearly 10 million travelers, a figure that underlines our central role in daily mobility.
• Opening to competition: From 2023, and extending until 2039 depending on the lines, we are adapting our strategy to respond to competition in the different regions, particularly in Île-de-France.

Our ability to manage a large volume of data is crucial. We analyze information such as timetables, regularity, equipment and services at the station. This data is essential to ensure good quality of service and to optimize our daily operations.

In addition, in an approach of transparency, the SNCF shares some of this data in open data, making train timetables accessible in real time, among other things.

• Open Data: Our commitment to greater transparency is reflected in the publication of transport data in formats such as GTFS-RT, GTFS and NeTEx, freely usable by everyone.

The group’s development, its financial performance, as well as the strategies adopted to remain competitive remain key data in our sector analysis.

Case studies

We take a close look at the competitive landscape of SNCF, highlighting specific cases that paint a clear picture of the competitive landscape of rail transport in France as well as relevant international comparisons.

Opening to competition in France

The opening to competition in the French railway market marked a decisive turning point for the SNCF. With the progression of European directives favoring the liberalization of rail transport, new players have begun to emerge. Companies such as Renfe and Trenitalia have expressed interest, considering expanding their TGV operations in France. Our SNCF group is therefore facing a major challenge but also an opportunity to assert our unique railway expertise.

International comparisons

At the international level, we carefully observe competition patterns in the rail sector. European companies, as well as low-cost airlines, are considerably changing the competitive ecosystem. Analysis of international competitive practices, such as that carried out in the SNCF case analyses provides us with valuable lessons on the strategies to adopt to maintain our leading position while approaching new markets in an innovative and sustainable way.