Virgin is planning to raise £700m to fund a rail service across the Channel that would rival Eurostar, with a view to running services between London and Paris, Brussels and possibly Amsterdam. The company, owned by billionaire Richard Branson, plans to offer a high frequency service by the end of the decade, ending Eurostar’s near three decade monopoly.
The funding plan includes £300m in equity and £400m in debt, with Virgin acting as a cornerstone investor to launch the project. A Virgin spokesperson said that the Channel cross has been due for competition for a while now and the company is ready to tap into the market and enhance the services to be offered.
On the other hand, the owner of Channel tunnel, Getlink and London’s St Pancras station have reached an agreement to increase the number of cross-Channel trains and open new routes to Germany and Switzerland. St Pancras wants to increase the number of passengers three times during peak hours to fit in with the push for more accessibility.
Challengers to Eurostar’s supremacy are not only Virgin. Spanish rail operator Evolyn has also announced its plan to offer high-speed service between London and Paris and has ordered 12 Alstom trains with an option to order more. Nevertheless, both Virgin and Evolyn are facing challenges, for instance, a dispute over train storage at Temple Mills depot in London, which is still owned by Eurostar.
The UK rail regulator (ORR) has been asked to step in, by ordering an independent examination of the depot space. On a separate note, the ORR also reduced the track access charges for operators using the St Pancras–Channel Tunnel line, which may draw in new entrants. Eurostar has come under a lot of criticism for charging very high prices for tickets and reducing the number of services including the international services from Ashford and Ebbsfleet in Kent. It means that travellers could soon have cheaper and more frequent options for crossing the Channel offered by Virgin and other providers.
