Deutsche Bahn and SNCF enter digital rail partnership, UK lags behind

German and French rail industries will be working closely together on digital innovation in a bid to future proof their national networks.

Dr. Rüdiger Grube, CEO of Deutsche Bahn AG, and Guillaume Pepy, President of French National Railways (SNCF), signed a memorandum of understanding in Berlin at InnoTrans, the leading international trade fair for transport technology.

They agreed to bring together their know-how and learnings generated so far to bring more modern services to their rail passengers. A key focus will be how the companies work with fast-moving, disruptive start-up technology firms.

UK rail network lags behind

The announcement between two nationalised, state-controlled entire rail networks brings into question the ability of the UK network to advance as a whole given its complex franchise structure. Once seen as the step to modernisation, privatisation of the rail industry has received enormous amounts of negative press and is accused of serving short term, profiteering interests.

While maintenance of tracks is the responsibility of one body, Network Rail, the operation of the country’s trains is split into several franchises often run by companies housed overseas. The degree to which services modernise is therefore largely down to what each franchise decides to invest over the course of their contracts.

Indeed, there have been a number of recent headlines stemming from controversial franchise decisions, from Go Ahead's Southern Rail's continuing dispute with conductors to Abellio’s awarding of a new nine-year contract with the Greater Anglia network.

New projects such as Crossrail and HS2 promise to deliver futuristic services connecting London and the central spine of the UK. However, the cost of the latter has been brought under increasing scrutiny with many interest groups arguing the money could be spent on modernising much of the existing, Victorian network.

French and German rail looks to start-up technology

"When we look in particular at the major opportunities that digitisation offers for transport companies, it makes obvious sense to share ideas and methods with SNCF. I believe in doing so, our customers will benefit,” said Grube.

“With the digital revolution now underway, we need to be as strong as we possibly can —especially in light of the operational and customer challenges,” added Pepy. “This is the purpose of our new cooperation agreement with Deutsche Bahn, on aspects ranging from the way we cooperate with start-ups to Industrial Internet solutions and further on to onboard connectivity. Working together will not only serve the interests of SNCF’s and DB’s customers, but also those of the mobility community at large.” 

Another goal is to identify the requirements that digital data transmission in rail transport will need to meet in the future, so that rail companies can work with the telecommunications industry to improve connectivity for customers and employees.

Both companies have already gained some insight into what it means to work together with start-ups. Now they intend to learn from each other on how to deal with these new forms of collaboration. They plan to foster innovation by creating joint-event-formats and agree on topics and challenges to be solved by the tech scene accordingly.

Whether nationalisation would enable the UK to enter similar partnerships with other European rail networks is not known. What is known is that France and Germany can enter partnerships and take decisions on behalf of their entire rail system – the UK and its franchise system cannot do so in the same way, if at all.

Read the September 2016 issue of Business Review Europe magazine. 

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