The Eurostar service has seen its demand almost completely wiped out as a result of the coronavirus health crisis. It is believed Eurostar has already faced a 95 percent fall in demand as the pandemic continues to make travel restrictions necessary. The company’s annual revenues collapsed from £1billion (€1.1bn) in 2019 to about £180milllion (€208m) in 2020. On top of this, Eurostar has already borrowed £400million (€450m) and received a cash injection of £170million (€197m) from its owners.
The financial crisis at the rail service has already seen the UK and French governments clash over how to save the company.
France’s junior transport minister, Jean-Baptiste Djebbari, told the country’s parliament in January that he was talking to the Government in Britain about helping to save Eurostar.
But he was rebuffed by the UK Transport Secretary Grant Shapps, who said Eurostar “is not our company to rescue”.
Eurostar is 55 percent owned by the French state railway SNCF, 40 percent by infrastructure funds CDPQ and Hermes, and five percent by Belgian railway SNCB.
This standoff will lead to an “arm-wrestle” between governments in Paris and London, a transport economist said in January.
Professor Yves Crozet of the University of Lyon told a transport select committee: “If you want to keep the Eurostar, you have to give a lot of public subsidies. It is the same consequence that we have after a war.
“We will probably have arm-wrestling between the UK and France about that.
“Clearly it is not possible to stop Eurostar. We need Eurostar.”
The select committee chair Huw Merriman called on the respective governments to set out a joint commitment to protecting the service.
He added: “We simply cannot afford to lose Eurostar to this pandemic. The company contributes £800million each year to the UK economy.
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Jean-Pierre Farandou, chief executive of French state rail company SNCF, told the Financial Times: “We are getting closer to the moment when Eurostar will have real cash flow problems… by next month, we have to conclude these discussions.
“We hope that it will be weeks [for a rescue deal] because the financial situation is going to be very difficult at the end of May, start of June.”
A source close to Eurostar said this week: “Eurostar has been providing a bare minimum service until now, it is already at breaking point.
“If funding doesn’t come in place and further measures restrict travel, we could be feeling the pinch of bankruptcy later on this year.”