Eurostar is on the brink of collapse after the pandemic left the service in financial turmoil. 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 (€460m) and received a cash injection of £170million (€197m) from its owners.
The rail operator is also under pressure to raise funding because of the £400million debt hovering above its head.
This has led to a disagreement between French politicians and the UK Government over a bailout fund.
Prime Minister Johnson has been pressured to help the company, but the UK sold its share in Eurostar in 2015 for £750million (€863m).
Meanwhile, French state rail company SNCF owns 55 percent of the company.
But Eurostar also employs around 3,000 people in the UK.
The Rail, Maritime and Transport (RMT) union called on the Government to help the service last July.
Assistant general secretary Mick Lynch said: “Short-term cuts would have dire long-term consequences.”
He said the union would be seeking talks “to stop this cull of jobs and services which would leave Britain ill-equipped to kick-start the economy with cross-Channel tourism and trade”.
Manuel Cortes, general secretary of the Transport Salaried Staffs Association (TSSA), added: “Eurostar provides a green strategic link between Britain and our European neighbours. It’s absolutely crucial that these services are retained.”
Huw Merriman, chairman of the Commons Transport Select Committee, joined the calls for UK to come up with a solution for Eurostar.
Mr Merriman continued: “Services have been stripped back to a bare minimum. It needs a joint, bespoke UK-French solution to help it through this crisis.
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“There is no comparison for it, and it can and will lead to the bankruptcy of a number of companies, unless there is the political will to prevent it.”
The Channel Tunnel operator is in advanced discussions with a group of banks, including UK taxpayer-backed NatWest, to secure lifeline funding.
Insiders said the company’s attention had turned to restructuring its loans, following weeks of lobbying ministers on both sides of the Channel for a bailout that is yet to yield a deal.
There is an option for Eurostar to extend the June deadline for repayment for another 12 months, however this would mean the company would have to abide by strict financial rules.