German monopolies Commission and DB

[jis]

The German Monopolies Commission has come out strongly against the current integrated structure of DB, suggesting that it unfairly thwarts competition, and needs to be modified with clear separation of infrastructure and operations.

.

In Railway 2015: Competition policy off track?, the Commission argues that DB’s integrated structure facilitates discrimination against competitors. Because of this, the Commission is ‘convinced that the only way to establish undistorted competition in the German railway sector is to completely separate the infrastructure and transport units of the integrated company Deutsche Bahn AG.’

See the whole article at: http://www.railwaygazette.com/news/policy/single-view/view/monopolies-commission-calls-for-db-unbundling-and-privatisation.html

 

[cirdan]

The German Monopolies Commission has come out strongly against the current integrated structure of DB, suggesting that it unfairly thwarts competition, and needs to be modified with clear separation of infrastructure and operations.

.

In Railway 2015: Competition policy off track?, the Commission argues that DB’s integrated structure facilitates discrimination against competitors. Because of this, the Commission is ‘convinced that the only way to establish undistorted competition in the German railway sector is to completely separate the infrastructure and transport units of the integrated company Deutsche Bahn AG.’

See the whole article at: http://www.railwaygazette.com/news/policy/single-view/view/monopolies-commission-calls-for-db-unbundling-and-privatisation.html

From a discussion with the employee of a private freight company some years ago, I learnt that the private freight lines are disadvantaged with respect to DB as when the private companies want to change schedules or add or move services the approvals process can bog them down for a long time. However, DB itself seems to have much more flexibility in changing things short term. Furthermore, he told me that whenever they (the private company) were proposing a new service or change that was innovative or tapped into a new market that DB had been asleep about, DB would have a service up and running before they did, proving that the DB infrastructure guys talked to the operations guys in an anti-competitive way.

OK, this was the opinion of one guy, and I don't think his every word should be treated as canon. But if there is some core of truth in what he says, it would certainly be a good idea to separate out network and infrastructure in the way it was done in the UK.

 

[Anderson]

The German Monopolies Commission has come out strongly against the current integrated structure of DB, suggesting that it unfairly thwarts competition, and needs to be modified with clear separation of infrastructure and operations.

.

In Railway 2015: Competition policy off track?, the Commission argues that DB’s integrated structure facilitates discrimination against competitors. Because of this, the Commission is ‘convinced that the only way to establish undistorted competition in the German railway sector is to completely separate the infrastructure and transport units of the integrated company Deutsche Bahn AG.’

See the whole article at: http://www.railwaygazette.com/news/policy/single-view/view/monopolies-commission-calls-for-db-unbundling-and-privatisation.html

From a discussion with the employee of a private freight company some years ago, I learnt that the private freight lines are disadvantaged with respect to DB as when the private companies want to change schedules or add or move services the approvals process can bog them down for a long time. However, DB itself seems to have much more flexibility in changing things short term. Furthermore, he told me that whenever they (the private company) were proposing a new service or change that was innovative or tapped into a new market that DB had been asleep about, DB would have a service up and running before they did, proving that the DB infrastructure guys talked to the operations guys in an anti-competitive way.

OK, this was the opinion of one guy, and I don't think his every word should be treated as canon. But if there is some core of truth in what he says, it would certainly be a good idea to separate out network and infrastructure in the way it was done in the UK.

As usual I've got mixed opinions here. The EU's handling of rail in general has been, frankly, less than desirable. The UK got things working through the franchise system they set up, but at the same time the UK's network is functionally insular besides the Chunnel...and within the UK I'd argue that railroad reform has been a major success. On the other hand, there has been an over-focus on competition across the board that has not worked to Europe's benefit (witness the Intercity cutbacks). As odd as it sounds, the slow move towards consolidating into a few massive international rail conglomerates there is probably where Europe ought to go...in the rail business it does seem that two companies is the ideal number in most cases.

I don't think it would be bad to arm-twist DB on streamlining their process for working with other lines or giving private operators access to something akin to the ICC (in the sense of a regulator that has at least some ability to inform DB that they will be granting a change to the other operator) or forcing DB to split itself into two companies in some form (which brings to mind the nightmare that was the division of Conrail).

 

[jis]

The start of the intercity cutbacks in Europe predate any reorganization of rail networks to support open access by many years. It started with the introduction of TGVs in France. The attempts to get the Departments to pony up for local service was an SNCF initiative that predates open access. Arguably, passenger service on branch lines have actually improved in Germany as a result of open access, such as it is, with many small private enterprises picking up marginal service which DB was unwilling to continue to run.

Incidentally, France has already split SNCF separating out the infrastructure part as a separate (government owned) company.

 

[cirdan]

The start of the intercity cutbacks in Europe predate any reorganization of rail networks to support open access by many years. It started with the introduction of TGVs in France. The attempts to get the Departments to pony up for local service was an SNCF initiative that predates open access. Arguably, passenger service on branch lines have actually improved in Germany as a result of open access, such as it is, with many small private enterprises picking up marginal service which DB was unwilling to continue to run.

It also depends a lot on the attitudes and priorities of local governments.

By handing over budget responsibilities to them, some have been able to put their money where their mouth is and actually do stuff. Maybe one of the best examples is Karlsruhe where the local streetcar operator used innovative dual-mode cars to provide throuigh running onto local railroads, meaning passengers have a seamless one-seat ride rather than having to change from train to streetcar at the main station. They have been expanding the system at an amazing rate since. In some cases long disused lines have been brought back to passenger service, in others new tracks have been built where the trains revert to streetcar operation and can so run straight through the centers of some of the smaller towns rather tha serve the rather peripheral stations. Despite the massive growth of the system, overall subsidies have not spiralled out of control, in part due to additional patronage coming in and in part due to automation (many lines that were previously dispatched manually are now on fully automatic signalling systems with the result that overall staffing levels are down)

Other regions have let things go on much as they were before, if not get worse. But at least they can no longer simply blame DB if things are not as good as they would like.