Evidence of meeting #20 for Transport, Infrastructure and Communities in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was trains.
A recording is available from Parliament.
May 26th, 2009 / 4:05 p.m.
Ashley Langford Vice-President, Alstom Transport
Yes, I'm all set to go.
Does everybody have their handout, with the little pictures? I'm more of a visual person. Sorry, I don't have a big paper to hand to you, but I figure you'll remember most of the details in-between, if you have some visual cues.
First of all, Alstom, as some of you know and some of you don't, has the largest fleet of high-speed trains in the world. We have the land speed record of steel-wheel rail vehicles, at close to 575 kilometres an hour, or almost 360 miles an hour.
Some of the other companies you know better. Bombardier, which people generally think of as primarily a Canadian company, has a rail transportation division that is German; they're based in Berlin. Siemens is also based out of Germany, in Nuremberg. And we're based out of Paris.
The transportation industry is focused out of Europe because somewhere close to 70% of the world market is in Europe. So the technology is driven from a European perspective and the way Europe functions.
In terms of us in Canada, most of our employees are in the Montreal area, somewhere around 1,000 people, I believe. We have two groups: power and transportation. By “transportation”, we mean rail transportation. And within rail transportation, we also have an information systems group, which essentially supports the rail industry. That's a global export business for us. Montreal is the global headquarters for that business, and we do passenger information and security systems globally out of there. We have about 2,500 employees in upstate New York, with the primary focus on the New York City market, because they buy a lot of subway cars and we supply a lot.
So I think that gives you a rough idea of who we are in Canada and North America.
If you turn to the slide that says “Why High Speed Rail?”, I think this really shows the driving force behind why people have chosen high-speed rail. If you look at the two maps I have there, you have a green map, which is just a plain geographic representation of France, and then a red map, which is how the geography has been transformed because of high-speed trains. You could say, “Oh, well, we can do this on airplanes”, but airplanes, really, are too expensive, and frankly they can't provide the medium-distance connections provided by rail. If you want to go within a 400- to 500-kilometre range, you're far better off moving people by train. The speeds from the starting to the end point, door to door, are faster.
Then, if you look at the other advantages, which are on the next slide, it's a question of safety. If you're moving people in the wintertime, do you want to have people moving essentially on dangerous roads, on which there are huge numbers of deaths per year? I don't know the statistics in Canada; perhaps you are more acquainted with them than I am. But when you consider the TGVs in France, no one has ever died on one of these trains. So from a pure safety perspective, this is the safest way to move people.
In terms of the envelope, or how much land you absorb, such as whether you need another Highway 401 to meet the future needs of demand in the Montreal to Toronto corridor, if you put in a rail system, you're going to use half of that footprint; and the greenhouse gas emissions and the carbon usage of high-speed rail are only going to be a fraction.
As Mario pointed out, the only really logical way to go forward with this is to go electric. The reason is that the operating costs of even a diesel-fuelled train relative to an electric train are about four to five times as much. Right now that doesn't seem to be such a big deal, but if Jeff Rubin is right and we see oil prices go back to $120 to $140 a barrel, and then move up from there.... It's not going to happen overnight, as we're in a recession, which has given us a bit of a breathing space, but I think within a decade we could be, in real terms, in that range again. If we are, then the demand for transportation will be suppressed because of the fact that it will be costing so much to move people.
I think those are some of the main reasons why the Europeans.... If you look at the next page, you can see the evolution in Europe to 2010. Their whole network has changed and developed from 2001. Essentially, they started off with a few small links between major cities. Then they kept on expanding them. By 2010, which is just around the corner, they'll have major linkages between almost all European countries.
Even Russia has linkages from Moscow to Helsinki through St. Petersburg. Siemens has one leg of that, from Moscow to St. Petersburg, and we have from St. Petersburg to Helsinki. It just depended on the orders that the government placed.
If you look into the future, that network is being expanded, and expanded again. You have to ask, why is it so attractive over there, even in Russia, and we haven't moved here? I think there are some historical reasons for that.
When we essentially privatized CN, instead of doing what Europeans do--namely, they keep all of the rail infrastructure as part of government property and then give operating licences--we did the opposite. We gave away all the property. Then we gave an operating licence to the passenger service, which means passenger service is dependent completely on CN and CP for access and therefore gets second priority.
In Europe, the first priority is passengers. The second priority is freight. As a result, you see quite a different operational scenario. You see much better technology for signalling and train control throughout the entire system. You also see track that is of much better quality, because it's government property. It's just like the highway system. They don't differentiate between the two.
Those are some of the fundamental reasons why they have a different set-up than we do. I'm not judging the way we do it here versus there, but those are what drove different sets of decisions.
If we want to have high-speed lines, we can operate in mixed traffic with freight, but that will mean either having lower speeds or controlling the quality of the train tracks. You will also have to do more grade separation, and grade separation really becomes the big driving cost.
Some people ask how much it would cost to electrify the whole line. Well, that's really nothing. For vehicles, electrification is small potatoes. The big cost is the land and then the grade separation. It's really a question of constructing bridges so that roads can go over the tracks and people won't be wandering into the right-of-way. These trains move so fast, you don't see them coming. You don't hear them coming. They're just on you. If you're going 300 kilometres an hour, you have no time to stop.
So if you're going to operate on the same corridors as CN between Montreal and Ottawa, you're going to have to dedicate part of that right-of-way just for high-speed trains. Otherwise, you're going to keep bumping into the freight trains or slowing down.
How long does it take to build the system? Well, from the time you make a decision to actually anything happening, it's usually about a year to a year and a half of design activity. After that, construction would take in the range of five to six years at a reasonable time speed. Before that, you actually have to figure out how you're going to tender the contract. You have to acquire the right-of-way. So you're really more or less in a ten-year program to do this.
If you're looking forward and saying we should have a contingency plan in place just in case oil prices double, or in case they triple, then you need to have a lot of these fundamental things done in the meantime. Even if you want to build a highway, you need to make sure that you have that space. It's kind of good to get the corridor defined, acquired, locked down, and then have all the designs in place. It costs very little to do that.
If oil prices never go up and people stop driving cars, then you're okay. If people keep driving cars and our population keeps growing, well, the highways will get jammed up and the death rate will go up. Oil prices look like they will go up as well.
So it makes sense to have some vision and think ahead a little bit. I summed this up with a little bit of Alstom experience. We actually did the Acela program with Bombardier. It was a joint project and it's been very successful; in the northeast corridor, the numbers keep going up. Each year they keep investing more, and I think that's a precursor to the whole transportation strategy of President Obama, where he's defined different quarters in the U.S. George mentioned it briefly. I think the Americans are seeing this as a future vision. And I think it's a vision we should be sharing, not everywhere in Canada but in certain defined corridors where it appears that there is the passenger volume to support it. I think this would be a good thing to do.
I've just added onto the back a little bit of information about the Helsinki to St. Petersburg corridor so you could get a sense of what would be involved if we did have high-speed trains. This kind of reflects a similar kind of situation. I think St. Petersburg and Helsinki are actually smaller cities than Toronto and Montreal, so if they can justify doing it there, then I think there's justification for Canada as well.
That's it.
4:15 p.m.
Liberal
Joe Volpe Liberal Eglinton—Lawrence, ON
Thank you, Mr. Chairman.
Thank you very much, gentlemen, for coming and sharing your perception with us.
I've talked to you or to some of the representatives of your company, so my questions will probably seem redundant for some of you.
I was struck by your approach to whether this is something that should be done or whether we should continue talking about doing it. I thought you had said there, Mr. Langford—I'm sorry, I think it was you, or was that you, Mr. Péloquin?—that what you should do is just simply go to the decision phase, not the study phase, because there have already been something like 14 or 17 studies; I can't remember what the number is any more. Are we at a point where we can actually legitimately say we are at a decision phase because the studies have been done?
4:15 p.m.
Director, Mobility Division, Siemens Canada Limited
I believe so, because you can repeat studies, as has been done in Canada for high-speed passenger travel, and depending on who the consultants are or the mix of people doing the studies, you will find different results every time. At the end of the day, we know that people want efficient rail travel, and they will take the train if it's comfortable, accessible, and convenient. So if they can travel between major centres faster than they do today and the reliability is also increased—if we can bring the on-time performance from some 50% to 60% up to 95% to 98%—you'll find very much that new systems are being built all over the world every day, and these trains are full all the time. If you don't reserve a few weeks to a few months ahead of time, you just can't get on the train.
4:15 p.m.
Liberal
Joe Volpe Liberal Eglinton—Lawrence, ON
That having been said, does that mean that they are actually viable financially, or is there still a public participation with coverage of the operating costs?
4:20 p.m.
Director, Mobility Division, Siemens Canada Limited
I believe my colleagues from Bombardier were right earlier when they said that to build any such infrastructure project public funds have to be dispersed, because the costs of the engineering and construction are very high and could not be recovered under regular methods of operating for companies like ours.
4:20 p.m.
Director, Mobility Division, Siemens Canada Limited
In the short term or medium term. It would take quite a long time.
4:20 p.m.
Director, Mobility Division, Siemens Canada Limited
The operating costs, when you compare those with the fares for those trains, could be self-sustainable.
4:20 p.m.
Liberal
Joe Volpe Liberal Eglinton—Lawrence, ON
We can divide the concept into three parts—the civil engineering, the rolling stock, and the operation. The first two are infrastructure and would stay with whoever does the financing. That's why Mr. Haynal says you have to have government involved. The trains could always be full if you don't charge much to get on them. Is part of the feasibility study an effort to define the amortization costs to be recovered for all the parts and the ongoing maintenance, or is it just associated with rolling stock and ongoing maintenance?
4:20 p.m.
Vice-President, Government Affairs, Bombardier Inc., Bombardier
There have been so many studies that it's hard to answer your question. I think each study will have a different focus.
Maybe Paul could talk a little bit about our experience with the Lynx study, which took place 14 years ago.
4:20 p.m.
Paul Larouche Director, Marketing and Product Planning, Bombardier Transportation, Bombardier
That dates me. I worked on that personally, but—
4:20 p.m.
A voice
Not a grey one.
4:20 p.m.
Director, Marketing and Product Planning, Bombardier Transportation, Bombardier
During the Lynx study, we updated the ridership studies that had been conducted by what was then called the tripartite study, which had been conducted by the federal, Quebec, and Ontario governments. We got some very knowledgeable people to come in from SYSTRA, from the SNCF, the consulting arm of the French national railroads.
I was amazed to see how important a ridership study is to the actual design of the system. They have models where you can be tweaking the trip time. If you reduce the trip time, you increase the ridership. If you increase the fare, you reduce the ridership. You push that into a financial model, and through various iterations you can learn the optimum trip time and service level that you need to be offering to have an economically viable system. This ridership study is essential. It's an iterative process that allows you to design the type of system you're looking for.
4:20 p.m.
Liberal
Joe Volpe Liberal Eglinton—Lawrence, ON
If I continue to travel at 100 to 150, it's not likely that I'm going to increase ridership.
4:20 p.m.
Director, Marketing and Product Planning, Bombardier Transportation, Bombardier
Correct, because you have competing modes that will give you a shorter trip time. Even with the price of automobile fuel going up, you're not necessarily going to increase ridership. If you go to higher speeds, you shorten your trip times. It's not absolute speed that's essential. People are always focusing on the top speed of a technology, but what's important is the actual trip time to get from point A to point B. That's what drives ridership.
4:20 p.m.
Liberal
4:20 p.m.
Director, Marketing and Product Planning, Bombardier Transportation, Bombardier
It will create a mode shift, yes.
4:20 p.m.
Liberal
Joe Volpe Liberal Eglinton—Lawrence, ON
Mr. Langford, you mentioned something about transforming the transportation systems in Europe. When you can commute from Paris to Marseille or from Paris to London, what happens to the regional air service in the area?
4:25 p.m.
Vice-President, Alstom Transport
The impact on regional air service is negative. If you look at Europe, most people move in 200- to 400-kilometre movements. They move by train. They don't move by air. Compared to here, I would anticipate a drop in demand for air passenger traffic between Montreal and Ottawa or Montreal and Toronto. It just makes sense. It's a reality. However, what you do see is an inducement to additional transportation demand. What happens then is that people who live in Kingston and who would say it's too far to drive into Toronto every day can now be on a train. That becomes a commuter shed. So they can move to Toronto or Montreal and then move back and forth. So you see a lot more movement.
It also means that it stimulates the regional economies of those smaller centres, because now people can treat them as a bedroom community. Instead of saying they'll live in Pickering and then go into Toronto, they can live in Kingston and go into Toronto, or live in Kingston and go to Ottawa every day. As long as the fare structure is comparable to the amount for driving a car by yourself every day, then it becomes much more attractive. If you go to Europe, you see this kind of regionalized train service, and you don't see that many short-haul aircraft movements. They still exist for people that are really in a rush, but generally they don't exist any more.
4:25 p.m.
Bloc
Mario Laframboise Bloc Argenteuil—Papineau—Mirabel, QC
Thank you, Mr. Chair.
Thank you for being here. We are fortunate in being able to welcome the world leaders in rail transportation. I need your experience. I am going to ask all three groups for an answer.
Mr. Haynal, you mentioned equity between modes of transport. We have been given studies from 1995 and technology has doubtless evolved since then. You said that trains are lighter now and you talked about the status of rail transportation. Before the economic crisis, freight transportation was growing significantly. So we will probably need a dedicated network for passenger transportation.
Given the population increase in the Quebec City—Montreal, Montreal—Windsor and Calgary—Edmonton corridors, and, considering what is happening elsewhere in the world, do we have the capacity to sustain a network like that with so little will shown by governments?
