Eurostar, the train operator that runs services through the Channel Tunnel, has called for a UK government bailout following a collapse in travel between Britain and the European continent.
The company, which is controlled by French state railway SNCF, is at risk of bankruptcy following a 95 per cent drop in travel since March. It has been running just two return services a day and has warned that it could run out of cash this summer.
The French government has a majority 55 per cent stake in Eurostar, and Belgium 5 per cent after the UK government sold its stake in 2015.
Shareholders — which also include Canadian institutional fund manager Caisse de dépôt et placement du Québec, and Hermes Infrastructure — have already pumped in €200m (£178m) to keep Eurostar afloat during the crisis but the company said this money was “finite”.
“Without additional funding from government, there is a real risk to the survival of Eurostar, the green gateway to Europe, as the current situation is very serious,” Eurostar said on Sunday. “We are encouraged by the government-backed loans that have been awarded to airlines and would once again ask that this kind of support be extended to international high-speed rail.”
New travel restrictions that come into force from Monday are adding pressure on infrastructure operators, with airlines and airports also calling for more support. The new rules require all travellers to Britain to have recently tested negative for Covid-19 and to quarantine for 10 days unless they test negative a second time five days after arrival.
Airports, most of which have been privatised in the UK, received business rate relief worth up to £8m a year in November but say it is not enough to support the industry through the pandemic.
Some smaller airports, such as Newquay and Cardiff, have already closed to passenger flights while many larger airports have reduced capacity. Heathrow’s terminal 4 is closed until the end of 2021 while at Gatwick airport the south terminal is also shut.
Airports argue that they need to keep providing some capacity for critical functions, such as flights to offshore oil, gas and wind operations to maintain electricity supplies, as well as post, freight, and emergency services.
Karen Dee, chief executive of the Airport Operators Association, said: “The UK and devolved governments now need to set out as a matter of extreme urgency how they will support airports through this deepening crisis.”
Airlines UK, the industry trade body, on Sunday also called for additional support, including grants, cuts to air passenger duties including the removal of the tax for return domestic journeys, as well as more loans and an extension to the repayment terms for existing ones.
Christophe Fanichet, head of SNCF Voyageurs, told French transport correspondents last week that Eurostar was in a “very critical” situation.
He said part of the problem was that the company was seen in the UK as a French business that was not supported by the British, and in France as a UK-based business not aided by the French. The company was negotiating for UK loans, as well as a possible recapitalisation by shareholders.
The UK government sold its 40 per cent stake in Eurostar for £757m before the general election in 2015 as it sought to pay off debts. At the time, dividend payments to the government were projected to exceed £700m over the next 10 years, according to the National Audit Office.
The UK’s Department for Transport said: “The government has been engaging extensively with Eurostar on a regular basis since the beginning of the outbreak. We will continue to work closely with them as we support the safe restart and recovery of international travel.”