Renfe will face rivals on the tracks at the end of 2020 for the first time in its history. The AVE and the new AVLO are today the stars of their business in terms of growth, visibility and international projection. These areas will also be the first to face competition.

In 2019, the last photograph of its results before leaving the monopoly, Renfe suffered a 30% cut in profits , reaching a gross result of 86 million euros compared to 120 million euros recorded in 2018. Revenue exceeded 4,000 million euros (4,021), 1.1% more.

The company chaired by Isaías Táboas has several subsidiaries, the largest of which is that of travelers since in terms of revenue it accounts for almost nine out of every 10 euros it invoices. According to the provisional data of the company, last year it transported 510 million users, just over three million more than 12 months earlier. Outskirts and other Public Service Obligations (OSP), the main activity by volume, transported 476 million travelers. The company precisely blames these OSP contracts with the General State Administration for the sharp deterioration of its operating result, which has gone from contributing 17 million euros in profits to losses close to 7 million euros. The adjustments undertaken already in January include the closing of commercial offices in stations with flows lower than 60 passengers per day . It is a measure that is distributed throughout Spain but is concentrated in the east of the country.

In any case, the area of ​​commercial services for travelers is the one that grew the most and did it thanks to the AVE, which on the eve of the railroad liberalization increased the number of passengers transported by 5%, to 22.3 million, 1, 3 million more than in 2018 and were above expectations. It is expected that with the next release of the AVLO on April 6 between Madrid and Barcelona, Renfe captures several hundred thousand more attracted travelers for average rates that, according to the company, will be between 10 and 60 euros.

Of course, the growing demand for high-speed services contrasts with the situation of the conventional network, where commercial services connect points of the Spanish geography in train users are less and less. Last year, the demand for Renfe's services in this network fell 1.1%. In total, 12.2 million travelers traveled, almost half that of the AVE . It is expected that with the entry into service of the new AVLO in April and the arrival of new competitors in the high-speed network as of December, the difference in users with the conventional network will widen.

Fleet renewal

The company's main investments will be aimed at renewing its fleet, with orders that are close to 5,000 million euros and that include new Talgo models for the AVLO; 211 Cercanías trains for Madrid and Barcelona; 105 trains for medium distance traffic and 38 hybrid trains.

Several of these contracts include maintenance commitments, with which the Renfe subsidiary that is engaged in this activity will see its revenues increased, which last year were stagnant at just over 700 million euros with losses of 15 million.

On the side of the rental of rolling stock, an activity to which the operator attached to the Ministry of Development is obliged to face its rivals for being the current monopoly of the Spanish market, the activity recorded revenues of 17 million euros. Finally, Merchandise is the business in which Renfe still does not lift his head.

Although this market preceded that of travelers in liberalization, revenues remain stagnant . The operator has made an effort to reduce losses, which have gone from 31 to 6 million euros but the result is still negative. Sources close to the company indicate that during the last year it has tried again to sell the subsidiary, although the potential stakeholders require Táboas to carry out a restructuring of costs that they do not want to undertake before. The differences at this point have prevented Renfe from ceasing to operate in the transport of goods to focus on passenger and maintenance.

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