An Ouigo train rolls into a railway station. EFE
Entry of low-cost high-speed private train operators Iryo and Ouigo in Spain forces Renfe to slash prices by up to 40%
Railway travel

Entry of low-cost high-speed private train operators Iryo and Ouigo in Spain forces Renfe to slash prices by up to 40%

The increased competition has forced the state rail company to heavily discount ticket prices on its AVE train services

Europa Press


Tuesday, 26 March 2024, 17:54


Fares for high-speed train travel in Spain are up to 40% cheaper today than when state-owned company Renfe was the sole rail operator in the country, new data shows.

Italian private operator Iryo entered the Spanish market in 2021 and French company Ouigo followed shortly after.

The latest figures from the National Commission of Markets and Competition (CNMC) comes amid tensions between new, cheaper operators Ouigo and Iryo, and transport minister Óscar Puente who accused the new competitor's low prices as the reason behind Renfe's "bad results".

The routes where the drop in prices has been the most noticeable are the Madrid-Barcelona and Madrid-Valencia routes with prices 40% cheaper compared to 2019, before the Covid-19 pandemic broke out and the first operator to compete with Renfe entered the Spanish market in 2021. Now you can travel between Madrid and Barcelona for 37 euros on average and from the capital to Valencia for 22 euros, according to the CNMC.

Ouigo is the operator offering the cheapest prices to Barcelona (37 euros on average), followed by Iryo (43 euros) and Avlo (Renfe's 'low-cost' service with 44 euros). In the case of Valencia, Ouigo and Avlo are the cheapest (22.5 euros), followed by Iryo (25 euros).

The increased competition has forced the down prices on Renfe's AVE trains, which were the ones that had to adjust their prices the most in the past year, by 20% on average, costing 62 euros to travel to Barcelona, and 23% less to Valencia, costing 38 euros. In parallel to this drop in prices, the number of passengers increased by 29% on average among all routes in the last quarter of 2023, with the total number of passengers close to 8.5 million people.

"Criticised for having low prices"

Ouigo's managers in Spain said in response to Puente's accusations: "We have made the market grow" . General manager of the French operator in Spain, Hélène Valenzuela, said the three operators have grown in all the hubs where they operate. "This is the first time we have been criticised for having low prices," she said. Ouigo, which is confident of achieving financial stability this year and leaving losses behind, assured the occupancy rate of its trains is 90% and they find it "strange" the minister talks about the sector suffering when the frequency of trains on the main routes has increased by 60%, according to CNMC data.

In terms of market share, Renfe Viajeros continues to be the main operator on all routes, accounting for between 50% and 76% of passengers, CNMC data also shows. Iryo accounts for between 25% and 30% except on the Madrid-Alicante route, where since 15 September it has only been operating from Thursday to Sunday, while Ouigo maintained a share of around 21% on the Madrid-Barcelona, Madrid-Valencia and Madrid-Alicante routes. It plans to have trains operating to Valladolid next April, Murcia in June and Andalucía in the second half of the year.

As for Avant, Media Distancia and Renfe's Cercanías services, the discounts for regular passengers approved by the government led to an increase in the number of passengers. Specifically, the number of passengers on high-speed Media Distancia trains (Avant) increased by 12.3% and those on Cercanías by 6%, although those on conventional Media Distancia fell by 6.2%, according to the CNMC.

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