France's SNCF Wants To Merge Eurostar And Thalys Services

French rail operator SNCF wants to merge Eurostar, which operates high-speed trains to London, and the Thalys service that takes passengers from France to Belgium, the Netherlands and Germany, its chief executive said on Friday.

Guillaume Pepy said that the move, which would take up to two years to implement, would create a single and more efficient European railway company and respond to new challenges as passengers opt against flying due to climate change.

He told reporters that the two networks, which are majority owned by the SNCF, could together transport 30 million passengers a year, compared with 18.5 million in 2018.

The project for the merger, dubbed "Green Speed", would have to be approved by the other shareholders of both railway firms and their supervisory boards.

"The idea is to develop and expand the network," Pepy told reporters in Paris, adding that "SNCF clearly wants to keep control" over the merged entity.

'Response to climate change'

SNCF has a majority 55 percent stake in Eurostar, which runs trains from Amsterdam, Paris and Brussels to London through the Channel Tunnel.

The other investors in Eurostar are the Canadian institutional investor La Caisse de depot et placement du Quebec (CDPQ) with 30 percent, British fund Hermes Infrastructure with 10 percent while Belgian railway operator SNCB has five percent.

Thalys is owned 60 percent by SNCF with SNCB holding a 40 percent stake.

The brand name and the headquarters of the proposed new company have yet to be determined.

"Our aim is to create a European company that can ease the transport from city to city between the countries and can compete with the plane and the car," said Rachel Picard, the head of SNCF's passenger arm SNCF Voyages.

Eurostar said that the challenge of climate change and "Europe's growing demand for eco-responsible and sustainable travel" presented a great opportunity for both companies.

There is a growing movement, especially among young people, to avoid flying due to the carbon emissions of planes.

"This new service would be an additional reason to choose the train over road or air travel in Europe," Eurostar said.

Pepy said the merger would be a "powerful response" to the challenge of climate change.

Emmanuel Jaclot, CDPQ's executive vice-president, said that the move had the support of the Canadian investor.

The creation of this major public transport platform would mark a milestone in European sustainable mobility," he was quoted as saying by Eurostar.

Eurostar transported 11 million passengers in 2018, generating sales of 1.15 billion euros ($1.26 billion). Thalys had sales of 527 million euros ($577 billion) after transporting 7.5 million passengers.