High Speed Train Too Expensive
    2013-01-04 18:38:37     CRIENGLISH.com         Web Editor: Wang Wei

The world's longest high-speed railway connecting Beijing and Guangzhou began operating at the end of 2012. Although its influence on economic growth and tourism has yet to be seen, the social effects of its exorbitant ticket prices have been felt around the country. Many people ask what brings such high prices? Expert explains that's due to the high construction and operation cost of high speed rail.

Zhang Wan has more.

 

A faster way of travel but with higher cost, high-speed rail in China continues to undergoing doublt.

The 2,298-kilometer line which links five regional economic centers including Beijing, Zhengzhou, Wuhan, Changsha and Guangzhou, largely shortens the traveling time between Beijing and Guangzhou to eight hours. But many people complain that tickets for the high-speed railway are too expensive. The top price for a ticket from Beijing to Guangzhou is more than 2,000 yuan, or 317 U.S. dollars, comparable to the price of an air ticket.

Many people have asked what determines high-speed rail ticket prices¡ªthe operation costs or people's consumption ability. What is the reason behind the high prices of high-speed trains?

Zhao Jian, a professor at Beijing Jiaotong University, explains.

"The cost of the high-speed railway includes construction and operating costs. The technological standards of the high-speed railway are very high. Therefore, it has had high costs for construction and operation. Certainly, the ticket prices of bullet train are definitely high."

Zhao Jian says he believes the high-speed line between Beijing and Guangzhou will see a big loss, because all of China's other high-speed lines are currently in the red.

The annual operating costs of the Beijing-Tianjin bullet train have been 1.8 billion yuan since the line started running in August 2008. It lost 700 million yuan during its first year of its operation. After the second year of operation, the high-speed line nearly broke even. And the high-speed railway between Beijing and Shanghai will not see a profit until 2014.

Zhao Jian estimates that the operating losses of the Beijing to Guangzhou line will reach 700 million yuan every year. In the meantime, other lines, such as the Beijing-Tianjin Intercity train and the Beijing-Shanghai high speed rails, have said they would slow train speeds and lower ticket prices to make ends meet.

"Although ticket prices for the high-speed train are three times higher than that of other railways, the high-speed line will still see a loss. When the technological standards for high-speed trains were set and their market positioning was done, the prices were then fixed. So the question is why didn't we have any further discussion about technological standards and market positioning at the beginning of high-speed railway construction?"

Currently in China, migrant workers and students are the main rail travelers, followed by tourists and businesspeople, so the majority of travelers using trains are relatively sensitive to high ticket prices.

Because of expensive tickets, trains running between Wuhan and Guangzhou, a section that was completed and went into operation earlier than the rest of the Beijing-Guangzhou line, often run with empty carriages.

Although the high-ticket prices cannot cover the costs of operating the line, passengers still complain about unaffordable prices.

Qiu Baochang, a lawyer specialized in consumer rights protection in Beijing, says the situation is caused by insufficient transparency in setting prices.

"Why is there so much complaining about high-speed train prices? Because the price setting is far from transparent. It's one-sided price."

many people say railway authorities should rethink the high-speed railway construction program, because borrowing money from banks and building costly railways as soon as possible causes problems. The financial burden is then transferred to passengers, whose average income is growing more slowly than sharply rising ticket prices on every class of train.

Only when prices are acceptable to most consumers can high-speed rail travel have a positive effect in promoting local economic growth. Otherwise, such rail lines will not be able to make ends meet in the long run.

For CRI, I am Zhang Wan.

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