April 13. 2024. 6:58

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Rail giants clash with ticketing platforms ahead of new EU travel law

As the EU prepares to table legislation to simplify booking long-distance journeys across the bloc, a fierce debate has broken out between rail companies and independent ticketing platforms over the provision of data.

Both sides are aiming to influence the European Commission in advance of the release of the Multimodal digital mobility services (MDMS) initiative in June.

Under the regulation, it will be possible for travellers to view a range of travel options to reach their destination, from flights to bus journeys to cross-border rail. In addition to price and duration, passengers will be informed of the carbon footprint of each mode.

Originally aimed at making it easier to book long-distance train journeys, the law was expanded to incorporate a broader range of travel options.

Robin Loos, sustainable transport officer with consumer advocacy organisation BEUC, told EURACTIV that the MDMS initiative has the potential to vastly improve the current booking system for long-distance trains, which he described as a “nightmare”.

“It’s something consumers expected but that simply never came, which is finding booking a ticket to cross borders easy,” he said. “If you’re not a rail geek, you will not find the right information, the right schedule, the right prices or simply know what to take or how to combine the train and the bus, et cetera.”

After years of debating how to encourage more sustainable travel, Loos sees the new initiative as a “quick win for consumers”.

“If it becomes plain and simple, you can see that taking the train is actually not really always longer than the plane. It could be the same price and then everyone wins,” he said.

Data sharing

To achieve the aims of the initiative, it is expected that a slew of data will be provided from travel companies to third-party platforms. This data will cover everything from departure times to dynamic pricing.

But EU rail companies have criticised the draft EU initiative as overly favourable to digital platforms, arguing that parts of the proposal undermine their business operations.

Alberto Mazzola, executive director of CER, a major European rail trade association, told EURACTIV that while the rail industry supports measures to improve international ticketing, this “shouldn’t be at the expense of the transport operators”.

“Railway undertakings operate on small margins with high fixed costs, so any regulatory intervention that decreases those margins will potentially result in diminishing services, with a negative impact on passengers,” he said.

If rail companies were required to advertise the tickets of competitors, this “would amount to restricting the freedom to choose sales partners to cooperate with or not and also which tickets to offer via which sales channel,” he said. “This would constitute from our point of view a severe curtailment of economic freedom.”

Mazzola also rejected the suggestion that rail companies should pay higher commission rates for sales made through third-party platforms, saying that profits should mirror the risks taken.

“If risks taken by ticket vendors are lower, their profits can also be expected to be lower than those of transport operators,” he said.

The narrative that the rail booking system is in shambles was questioned by Mazzola, who pointed to statistics that suggest the majority of Europeans are broadly pleased with the current approach.

“EU Barometer data from 2018 confirms that 75% of EU rail passengers are happy with rail ticketing, so the situation is not as bad as some stakeholders would like to portray,” he said.

Sharing the pie

EU Travel Tech, a trade association representing booking platforms including Skyscanner and Booking.com, said that if implemented correctly, the MDMS will revolutionise travel ticketing.

“Today, searching for, comparing, combining, and booking tickets of different transport modes is highly inconvenient and time-consuming, especially across EU borders,” Emmanuel Mounier, EU Travel Tech’s secretary general, told EURACTIV.

“Fixing ticketing is comparatively low-hanging fruit to make rail travel more attractive for all EU citizens and thus encouraging a shift away from cars and planes towards trains,” he added.

Asked about barriers to improving ticketing, Mounier apportioned blame to rail companies.

“Today’s main problem driver for limited consumer transparency and choice are railways, which abuse their dominant market positions to restrict third-party rail platforms and ultimately drive them out of the market,” he said.

“The problems facing consumers today when booking rail tickets do not arise due to inefficient technical standards, they are a result of commercial decisions by dominant railways,” he added.

Responding to complaints from CER that travel platforms shoulder little of the risks and responsibilities that train companies carry, Mounier said that third party booking vendors should only be compensated for the new sales they bring.

“Revenue is shared where rail platforms bring customers to the railways and provide added value,” he said.

“If no customers are brought to railways through ticket sales on third-party platforms, no revenue is shared,” he added.