The liberalization of public railway services is taking place throughout Europe, and in Spain in particular it is causing a revolution both in terms of infrastructure and in the impact it has on users, with a notable change in prices, demand and frequencies. In recent years, in our country the monopoly of the public operator that had operated until now: Renfe has been broken. A year ago new foreign rivals entered the High Speed. And since then, the effects have been noticeable in the price of the ticket and the offer available.
Now it is the turn of Cercanías, since in 10 years the autonomous communities that wish to do so will be able to tender their own services. And that will change everything.
A restructuring of the service. Renfe is going to have to weather the arrival of new regional Cercanías operators and other rail transport companies (whether national or foreign) that compete for a public service that now only Renfe provides. That is why it is already carrying out an administrative reorganization of resources and personnel.
This decentralization of Cercanías is nothing more than one more step in the liberalization of commercial services (which we have already seen in AVE and Long Distance), and where there is already competition (Ouigo or Iryo).
How will it be carried out? Specifically, all public services will be tendered for their provision from January 1, 2033, within 10 years, as established by EU regulations. This means that the Generalitat de Catalunya or the Basque Government could offer their own Cercanías services in their territory if they win a contest in which both Renfe and regional public operators such as Ferrocarrils, public companies (such as the French SNCF) or private companies may apply.
The role of the autonomies. In fact, there are already several interested in getting these skills as soon as possible. The clearest case is Catalonia, which has been waging a battle against the Government to control its Rodalies service. They want their public operator FGC to manage the network and not Renfe. Andalusia will also take the step, where several private operators such as ALSA or Eco Rail have already shown interest, although they will do so complementing Renfe’s offer.
What implications will it have? If we take into account what has happened with the liberalization of High Speed, we will surely see how the average price of tickets falls in a context where there is more than one operator, which is what usually happens when there is more competition. The frequencies will also increase, as has happened now, according to the CNMC. It must be remembered that the change will affect more than two million commuters who use Cercanías and Media Distancia daily.
On the other hand, liberalization could force Renfe to reposition itself in the market. Let’s remember that for its high speed it ended up creating a second brand called Avlo in order to retain passengers looking to travel cheaper. And, in turn, there will be a new distribution in the market share, possibly establishing a new railway map depending on the services offered by each company on different routes.
The frequency of AVE already exceeds Cercanías. Since the decentralization of public services was carried out, the frequency differences between the high-speed train and the commuter train are narrowing to the point that we have seen a surprise on various routes. In other words, the most recent data suggests that there are already more trains going from Madrid to Barcelona than from Valencia to Gandía (two cities an hour away) in Cercanías.
The reason, as we mentioned before, is competition like Iryo, which is reducing its prices and multiplying the frequency by three. We will have to see what happens when Renfe’s monopoly in Cercanías ends in 10 years.
The bus does not leave. The Government also seeks to bring this liberalization to the bus and is already working on the design of a new concession map that would reduce and simplify the number of state bus lines, operated under the administrative concession system for 20 years. The bidding for these new routes will take place in 2024 and will be carried out under a competitive bidding regime.
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