Spain opens the door to private railway operators

The year 2020 is key to the entry of private operators into competition with Renfe Operadora. At the end of 2019, the Railway Infrastructure Administrator (Adif) approved the distribution of train paths from the three main high-speed railway corridors into three packages.

The entry of private operators in competition with the state-owned company Renfe Operadora will be definitive on December 14th. Two stakeholders, SCNF and ILSA, have already been selected.
To reach this point, it has been necessary to approve several rules complementary to the directive of the European Parliament, as well as the definitive acceptance of this liberalisation, to be in line with the Fourth Railway Package.

A key Royal Decree

At the Cabinet meeting of December 21st 2018 the Spanish Government approved a Royal Decree-Law allowing new railway companies to operate in the national territory in long-distance and high-speed services.
This Decree marked the timetable to be adhered to so that in December 2020 any railway company with the appropriate licence for passenger transport and the safety certificate issued by the State Agency for Railway Safety would be eligible for the path tender competition in Spain’s three main high-speed railway corridors: The Madrid Corridor with the French Border, through Barcelona, the most demanded; the Levante Corridor; and the Southern Corridor (Andalusia).

The decree also specified that opening up to competition did not affect the services considered to be a Public Service Obligation (PSO), that is, those including Commuter trains, Mid-Distance trains and the Avant train, as the European ruling will not make it compulsory for the member States to bid for this type of transport, considered essential for communication, until 2023.

Furthermore, a possible extension of that period is under consideration, depending on the contractual situation in each country.

The distribution of paths into three packages

At the end of 2019, the Railway Infrastructure Administrator (Adif) approved the distribution of train paths from the three main high-speed railway corridors into three packages.

Package A, which provides for traffic of two trains per hour in the connection between Madrid and Barcelona; one per hour between Barcelona and Valencia and the same for the Levante corridor: one with Valencia and another one with Alicante. Although in the Andalusian corridor two trains were offered per hour from Madrid to Seville and one per hour on the route between Madrid and Malaga.

This package has railway traffic of about 104 trains per day, of which 32 correspond to the connection with the Catalan capital; 32 with the Levante area and 40 with Andalusia. This package was practically reserved for Renfe for being the only company with sufficient capacity to meet those requirements.

Packages B and C are those which Adif put up for bid for the entry of private companies in competition with Renfe Operadora. The first aimed at railway traffic of 16 trains per day in each of the railway corridors mentioned; whereas the latter restricted operations to up to five trains per day on each of the three railway corridors.


On November 27th Adif’s decision to grant the operation of Package A exclusively to Renfe Operadora was made public; whereas Package B was assigned to the Levante Intermodality Consortium (ILSA), formed by Air Nostrum and Treintalida; and Package C was for SCNF that will operate it through its subsidiary Rielsfera.
As Adif’s President, Isabel Pardo, pointed out when announcing this decision, there will thus be three competitors in the high-speed services, an aspect that represents a qualitative leap from the last paradigm of the Italian liberalisation, which resulted in a duopoly. For Pardo, this new stage will be “an opportunity for the economic development of the country”. It should be noted that with the entry of the two competing undertakings and the division of the paths between the three packages, the offer will be increased by 65% and ticket prices may also be reduced as there is increased competition in the market.


New Scenario

This new scenario is an opportunity to further boost the passenger railway as a means of transport in the country and to increase the latest passenger numbers. In this respect, it should be noted that in 2018, Spanish high-speed railway moved around 21.3 million passengers, up 1.1% from the previous year. In the corridor between Madrid and Barcelona 7.87 million travellers were transported; in the Southern one, about 6 million; whereas the figure in the Levante corridor exceeded 4 million.
The allocation has not reached 100% of what is offered. In the case of package A, Renfe has opted for 86% of the paths, leaving 14% available; whereas in package B, Levante Intermodality (Air Nostrum plus Trenitalia) have done it for 70%, leaving 30% of the offer vacant; and in the case of package C, 100% acceptance by Rielsfera (SCNF) has been fulfilled.

Framework Agreement

Finally, on 12th May 2020, the framework agreement was signed with the three companies that will begin to compete in Spain. Renfe proposed extending the contract to 10 years, on the grounds that there is a need to pay off the large investment in the purchase of new rolling stock and the refurbishment of the current one, which has finally been accepted by the Commission.

As for the proposals made, ILSA has already announced that they will offer 16 services between Madrid and Barcelona; 8 between Madrid and Valencia; 7 between Madrid and Malaga and Seville; and 3 with Alicante. The company will operate with Bombardier Zefiro trains provided by Trenitalia.
Meanwhile, although Rielsfera (SCNF) has not indicated how it will occupy its paths, it has been pointed out that it wants to operate with its low cost offer that in the market of the French country is provided through Ouigo- TGV high-speed low cost services – and that it could use the new Euroduplex of Alstom which are in the approval stage.

On December 14th, a new phase of existence opens up in the Spanish railway with the entry of Renfe’s competitors into the three most important high-speed railway corridors in the country. Thus, the objectives set by the Ministry of Development through liberalisation begin to emerge in the future, such as making the most of the network, in which some 51 billion euros have been invested, increasing the number of travellers and reducing the price of tickets, but always providing a perfect service based on quality, safety, efficiency and punctuality.