FRANCE’s TGV high-speed railway network is as synonymous with the country as the Eiffel Tower and champagne. Since the first train entered service between Paris and Lyon in 1981, the TGV has become an icon of France and the envy of many other countries around the world.
News then at the end of May that French National Railways (SNCF) was set to rebrand their flagship service to inOui was met with shock, with many taking to social media to deride the decision.
Passengers questioned the logic of changing the name of a world-renowned brand “overnight.” Others, as is the want with these platforms, were a little less polite in their assessment.
“The story was leaked to the media the Friday before we were going to announce the change, so inevitably the story was negative from the start,” says Mrs Rachel Picard, CEO of SNCF Voyages. “Some media said that TGV is dead. But this is far from the reality. Our plan is to develop and improve TGV, we have no plans to kill it. TGV is a €7.5bn business, it would make no sense to do that. But we do want to change the service and the image so TGV has a new appearance in the market and can attract new passengers and bring back others.”
SNCF’s new strategy comes at a time when its long-distance rail services have come under pressure in a difficult economic climate following the financial crisis and sluggish recovery. The car is responsible for 75% of long-distance journeys in France with rail accounting for around 7%. But at a time of increasing cross-country travel, the rise of low-cost airlines, liberalisation of the inter-city bus market, and car-sharing, a trend that Picard admits was not foreseen five or six years ago, have all served to stifle TGV ridership growth.
TGV traffic fell by 1.8% in 2013 to 52.8 billion passenger-km, rising to 53 billion in 2014, and 53.4 billion in 2015. The figure fell slightly to 53.1 billion in 2016.
At the same time, long-distance bus traffic increased from 6.5 million passengers in 2015-16 to 13 million in 2016-17, with estimates that this will grow again to 19.5 million passengers in 2017-18. Add to this traffic modelling projections released in 2015 estimating that SNCF could lose 15-25% of revenue to buses and car-sharing between 2020 and 2025, which equates to €1-2bn per year, and the company was compelled to act.
“Clearly the way people are travelling in France has changed,” Picard says. “They are increasingly bypassing the train and their choices are more and more dictated by price and good value, with people making decisions to travel more at the last minute than before. It is less organised and planned than it was 10 years ago. But we have a model that has not changed since we launched the service 30 years ago.”
Picard adds the impassioned response to the change reflects the importance of TGV to the French people. However, she was keen to emphasise that the inOui brand it is not just a name change without any alteration to the offering, and that it “needs more explanation than you will get on Twitter.”
SNCF is now two years into its €2.5bn TGV transformation strategy with another 30 months to run. Picard says that at the heart of the inOui brand is a new focus on service, with an emphasis on deploying the latest digital technologies to enhance the customer experience and achieve 95% passenger satisfaction by 2020. In an effort to achieve this goal, SNCF allocated €300m in its digital plan in 2017, and among the new platforms it is rolling out is a new digital TGV boarding system, which is in place at main line stations on the LGV Atlantique line, and will be installed at 13 hubs by 2018.
Notable in this is a change in the role of onboard staff. With the rollout of ticket barriers taking place at 15 TGV stations, covering 80% of traffic, Picard says the train manager will no longer check tickets onboard but focus on the service offering.
Armed with a tablet, which offers a profile of every passenger, they will be able to answer individual passenger needs, as directed through the onboard internet access portal - TGV Connect - which was rolled out on 53 trains in the first quarter of this year, with 190 set to use the system by the end of 2017.
“It is going to be a personalised and attentive service, more like what you would expect in a four-star or five-star hotel, but without the four-star price,” Picard says, adding that training of 15,000 staff to prepare for the change is underway, with 5000 already trained.
Inevitably changes to the trains themselves are playing a significant part in altering the service offered. A great proportion of the TGV transformation strategy investment is on new rolling stock, with SNCF set to introduce 55 TGV 2N2 Euroduplex Atlantique trains - dubbed TGV Océane - over the next three years. It will also fully refurbish its existing fleet to match the standard of service provided by the new trains.
The dual-voltage TGV Océane trains are the first to feature rotating seats in first class to face the direction of travel, with each train seating 556 passengers (158 in first class and 398 in second class), a 22% increase in seating capacity compared with TGV Atlantique single-deck trains.
Each train consists of two power cars, two first-class and five second-class coaches as well as a bar car, while the train incorporates new seating. Supplied by Compin and Fainsa, the first-class seat is said to offer “elegance, privacy and tranquillity, while providing a comfortable and warm space where the traveller can work, read and rest.” The seats make use of natural materials including pure wool, leather, and wood, while power sockets and USB charging points are provided at all seats.
Second-class seats also make use of natural materials with additional storage space and wider fold-down tables. There are also five-seat ‘benches’ for group travel.
TGV Connect is available via the train’s new high-speed Wi-Fi system, which is being installed across SNCF’s fleet under a €300m overall investment, with 21Net responsible for software, hardware and system supervision, and Engie Ineo responsible for project management, installation and maintenance. Picard says SNCF has also worked closely with Orange and other providers in France to ensure that the high-speed lines have a suitable 4G coverage in order to provide free access to the internet to all passengers.
“Having this level of onboard service, and incorporating digital technologies, is very important,” Picard says. “It makes tracking your progress easier, and it can provide you with journey information. You can also use it to pre-order food at the bar, or to order a taxi for when you arrive at your destination to provide a truly door-to-door service.”
Onboard personnel will also be responsible for passenger security, which Picard says is of paramount concern given recent terrorist incidents. Introducing gates at stations is an obvious response to the need for better security with Paris Montparnasse the first station set to be completed by July 2. “Passengers travelling without tickets is the first reason for trouble on our trains,” Picard says. “It is difficult for the train managers and the other passengers. This solution eliminates that problem completely.”
In addition, Picard says that armed plain-clothed police officers are travelling on SNCF trains following the passage of legislation in 2016. SNCF is also introducing a network of cameras to monitor people passing through the ticket gates as well as further cameras deploying the latest facial recognition technology. Dogs trained to identify explosives are also in use to assess suspect left luggage.
Ticketing is another key area going through a big change. Reflecting the new habits of TGV passengers, and to offer a more personal service, SNCF is revamping its voyages-sncf.com website, the number one e-commerce site in France, to OUI.sncf. The changes will take effect in the autumn, with OUI.sncf set to provide passengers more clarity in their choice of SNCF’s services, whether it is its inOui or Ouigo rail services, Ouibus or Ouicar. It will also update the SNCF app, which has been downloaded 5.4 million times and receives 13 million visits each month.
The inOui service will officially launch on July 2 when France opens the new Sud Europ Atlantique high-speed line between Paris and Bordeaux. 40 of the new TGV Océane trains will deployed on the line, with 17 expected to be in service by the opening, and SNCF currently receiving one new train per month.
Inevitably passengers using new services on the Sud Europ Atlantique and Bretagne Pays de la Loire line, which will also open on July 2, as well as the Montpellier bypass, which will open by the end of the year, will account for a big proportion of the 15 million additional passengers target - up to 35% according to Picard. Indeed, SNCF says 33 trains per day will operate between Ille-de-France and Bordeaux, all but wiping out air travel between Paris and Bordeaux with 35,000 seats set to be offered on its high-speed trains, seven times more than by air.
But there is still work to be done.
Picard says that in order to attract additional passengers away from other modes and onto its network, SNCF is working on various strategies which aim to build loyalty to TGV, some of which are already producing results.
TGVmax, a subscription service, provides unlimited travel for passengers aged 16-27 on off-peak services for €79 per month. Already 100,000 people have signed up and they now account for 5% of the traffic in second-class accommodation on off-peak services. Critically, more than half had never used the train before, and 80% of those who have, had not in the previous six months.
Similar loyalty card programmes for senior citizens and families are also attracting people on to the train, and Picard says these programmes have contributed to a 10% increase in traffic since the start of the year. “Compared with the businesses I have worked at before, this is unprecedented to get such a positive up take of these kind of loyalty programmes,” she says.
“Last year the objective was to attract 10 million additional passengers,” she continued. “But having seen the success we already have had, I felt that it was appropriate to increase this objective. What we are doing is getting good results and the market is responding very positively. The economy is better in France this year than it was last year, which was a difficult year. Even so, we managed to increase the traffic by 2%.”
There are further plans to improve the door-to-door connectivity of SNCF’s trains. This includes offering shuttle services for families direct from their home to the station and a “Valet and Cie” parking service for business passengers. This service is bookable online with passengers leaving their vehicles at a designated drop off point. Parking rates are up to 70% cheaper than a conventional car park and it has already been rolled out at Paris Est, in Marne-la-Vallée TGV, Roissy Airport, Nantes, Bordeaux and Lille. Stations will also increasingly feature “business boxes.” Pioneered at Paris Gare de Lyon, these separate working spaces provide an internet connection and a pleasant working environment, and will be available for passengers to use while they wait for the train.
Following the Paris - Bordeaux line, inOui will also be rolled out completely on Paris - Lyon services by the autumn, and Paris - Lille by the end of the year. Paris - Strasbourg will follow in early 2018, and the remainder of the network by 2020.
In parallel, SNCF is expanding the reach of its Ouigo low-cost high-speed service. Launched in 2013, and with prices starting at €10 for adults and a fixed €5 for children, the service has steadily expanded beyond its inaugural offerings from Marne La Vallée near Paris to Lyon, Marseille and Montpellier to serve Rossy-Charles de Gaulle Airport and Massy in the Paris area, north to TGV Haute Picardie and Tourcoing near Lille, and west to Le Mans, Angers, Nantes and Rennes.
Picard says the service’s TGV Duplex trains, which have capacity for 1200 passengers, are operating at an average of 90% occupancy and are now carrying 5% of all high-speed passengers. Half of these are new passengers to TGV, which she says emphasises the service’s success in helping SNCF to capture some of the market it had lost to other modes.
“The experience of the first four years of operation have shown that the service is sustainable,” Picard says. “Passengers have been willing to embrace the one bag policy and online ticket purchasing as well as the stipulation that they must arrive 30 minutes before their train departs. The goal now is to increase its reach to 34 destinations and 50% of the network and 25% of total passengers by 2020.”
To achieve its expansion objectives, SNCF plans to increase Ouigo’s fleet from eight to 34 trains by 2020. But instead of purchasing new trains, it will transition existing TGVs into the fleet.
Indeed, perhaps the real success story of Ouigo is its operating strategy. Picard says this emphasises high-fleet utilisation, with trains in service for 13 hours per day and spending limited time in reserve. All maintenance is carried out at night, meaning that trains are available for use throughout the day.
SNCF is now planning to extend this intensive operating model to the rest of its TGV fleet, with the goal of reducing the overall high-speed rolling stock requirements by 10% by 2020.
“Our objective is to reduce passenger operating costs by 30%, and we plan to achieve this by cutting the number of rolling stock in our fleet,” Picard says. “This will provide us with the opportunity to lower the cost of using TGV by 6% in the next few years, and by going for higher intensity of operation, it will afford us with the flexibility to invest in the comfort of the service.”
Picard says initial trials of the inOui service which began last autumn between Paris and Lyon have proven extremely positive. Results of passenger satisfaction surveys show a 10% improvement compared with the existing service, and Picard says users have commented on the “wow” factor of the train now on offer.
Ridership has also increased by 7% and Picard says this is encouraging for the start of the official rollout on July 2 at which point trains speeding between Paris and Bordeaux will start to display the inOui logo.
This will provide the service with valuable visibility as SNCF ramps up its marketing efforts. And as SNCF embarks on the next phase of the TGV story, inOui already seems to be resonating with the French public. The company might not have been able to control its launch, but as the saying goes, no publicity is bad publicity.
“We study the market very closely, and the notoriety of the brand went from zero to 53% in a week,” Picard says. “And that was without spending a single Euro.”
France opens three high-speed lines
JULY 2 marks a significant expansion of the French high-speed rail network when two extensions to the Paris - Le Mans/Tours LGV Atlantique to Rennes and Bordeaux open.
A 50-year €7.8bn concession was signed between the former French Rail Network (RFF, which is now SNCF Network) and Vinci in 2011 to fund, design, build, operate and maintain the Tours - Bordeaux Sud Atlantique Europ (SEA) high-speed line. At the time, the deal was described as the biggest PPP contract in Europe.
A total of €7.8bn was raised to fund the €6.2bn cost of construction and other aspects of the project. The public sector comprising the French government, local authorities, and the European Union, provided €3bn, and RFF another €1bn.
The Lisea concessionaire is led by Vinci with a 33.4% holding. The other shareholders are CDC Infrastructure comprising Caisee des Dépôts and Consignations Group (25.4%), Meridiam (22%), and Ardian infrastructure investment fund (19.2%). Lisea funded the remaining €3.8bn as follows: €772m from commercial banks and the European Investment Bank (EIB), €1.06bn in bank debt guaranteed by the state, €612m in non-guaranteed bank debt, €757m in savings funds managed by Caisee des Dépôts and backed by RFF, €400m of state-guaranteed credit from the EIB and a further €200m of non-guaranteed EIB credit.
In addition, RFF invested a further €1bn to adapt existing systems such as signalling and power supply, and expand Bordeaux station.
Lisea entrusted construction of the 302km line and 39km of connections to the conventional network to the Cosea consortium led by Vinci and including Arcadis and Egis Rail. SEA will be operated and maintained by Mesea.
The new line will cut non-stop Paris - Bordeaux journey times from 3h 11min to 2h 4min, while the Paris - Toulouse trip will also be reduced by more than an hour from 5h 27min to 4h 17min making it far more competitive with air.
The 182km Bretagne-Pays de la Loire high-speed line from Le Mans to Rennes will reduce the fastest Paris Montparnasse - Rennes journey time from 2h 5min to 1h 28min, with trains running at up to 320km/h on the new line from Le Mans to Rennes. The fastest Paris - Brest journey time will be 3h 13min, compared with 4h 7min prior to July 2.
The line, which includes 32km of links to the existing network, is an extension of the existing LGV Atlantique from Paris to Connerré, 20km east of Le Mans. There is also a line around Le Mans which intersects with the existing line at Sablé-sur-Sarthe for services to Nantes.
Construction on the €3.3bn project started in July 2012 under a PPP between the former RFF and Eiffage Rail Express (ERE), which was responsible for financing, designing, constructing and maintaining the line for 25 years. RFF and the regional governments contributed €1.8bn, while RFF/SNCF Network was responsible for associated works on the existing network.
RFF signed a 25-year PPP contract in 2012 with the Oc’Via consortium to build and maintain France’s first mixed-traffic high-speed line. The 80km line, of which 60km will be for 300km/h operation, will extend the existing LGV Méditerranée line from Manduel east of Nîmes to Lattes west of Montpellier.
The Oc’Via consortium, which comprises Bouygues Construction, Colas, Spie Batginolles, Alstom, Meridiam Infrastructure, and FIDEPPP, set up funding of €1.8bn comprising €1.05bn of bank loans, €117m from Oc’Via, and €594m of public funding from regional governments and RFF. The remaining funds for the €2.28bn project come from the French government (50%), local authorities (30%) and RFF (20%). The line will open in December.