Tuesday was the busiest day of the holiday season for Via Rail Canada Inc. trains travelling through the Quebec City to Windsor, Ont., corridor and all across Canada. At Toronto's Union Station alone, some 8,700 people were expected to board or detrain a Via Rail train, according to spokesperson Mylène Bélanger.
Last year, in the Quebec City-Windsor corridor, Dec. 23 was the busiest day of the holiday season, with 15,700 passengers travelling on Via trains. Yves Desjardins-Siciliano is the President & CEO of Via Rail. The lawyer was picked for the top job in the spring, inheriting a passenger railway facing declining ridership and service cuts. Mr. Desjardins-Siciliano recently spoke with Report on Business' Eric Atkins about the railway's plan to stem losses and boost ticket sales by improving service and wooing private investment in its key Windsor-Quebec City corridor.
When you talk to customers, what's the most common complaint you hear?
On-time scheduling. That is the biggest issue we are facing. On-time performance has deteriorated … from 83 per cent to 77 per cent. People often think of the train in terms of time on the train, but really the key factor is, will I get there at the time I am scheduled to get there? If that is reliable, if you leave when you say you will and arrive when you say you will, the customers don't [mind] that much if it takes 15 minutes more or half an hour more for a long distance trip, provided they can plan on it. But if they can't plan on it, because you're not going to be on time, you know 15 or 20 or 35 per cent of the time, then it's a problem.
Why did the on-time arrivals deteriorate?
Congestion. There are more trains on the tracks, an increase in passenger trains and an increase in freight trains. Grain traffic, oil traffic is growing on the freight side, and on the passenger side, with regional operations, GO in Toronto and AMT in Montreal, that puts more demand on the railway tracks. So that congestion is making it inefficient for both businesses.
If you could wave a magic wand, how would you solve that?
Dedicated track. Tracks on which passenger trains that run 100 miles an hour (160 kilometres an hour) run separately from tracks that have freight trains that run 40, 50 miles an hour.
What about high-speed rail?
Personally, I don't see the need for that for an intercity business at this time. First of all, rail infrastructure is something you build over time. So the first step is to have a dedicated track. If we look at countries that have high-speed rail, that's how it started. In European countries, before they had high-speed trains on high-speed rails, they had low-speed trains on dedicated tracks. Then over time as the traffic grew and there was a need for point-to-point fast travel between two major points, then they introduced high-speed trains. And today in Europe, only 25 per cent of the traffic is on high-speed trains. The other 75 per cent they are still doing low-speed because the inconvenience of a high-speed train is that it's of no use to you if you are 100 kilometres away from Toronto, because it's not going to stop. It only goes from points that are at least 350 miles (560 km) apart. So half of the business of Via Rail are people in the corridor who are coming from or going to non-urban areas. They're not from Ottawa, Montreal of Toronto. They're at the point in between. So a high-speed train from Montreal or Toronto would be no use to those people.
Do you see Via owning its own infrastructure any time in the future?
That's what we're hoping to do by going to the private sector and try to sell them a business strategy to do just that.
How would that go?
In the corridor between Ottawa and Toronto, there's 19 million people there, 14 million of which are in the work force. You've got over 30 universities and technical centres, half a million students. So you have a huge population pool that could use greater mobility to get in and out of urban centres. I think there's a huge business opportunity for the private sector to capitalize on. I think the government of Canada through taxpayers' money has done enough. Today the average fare of a customer on Via Rail is 53-per-cent covered by the government with taxpayers' money, so I think that's enough of a contribution. They have provided a billion dollars for infrastructure improvements.
For all that spending, service has been reduced and ridership has fallen, why would that be appealing to the private sector?
Those are two different things. The reduction in services was to recognize where there is no market there is no point having a service. So having trains run with 12 people on them or stopping at stations for three people does not warrant having attendants 80 hours a week. Where the opportunity is though, is where there is a huge market, 19 million in the Quebec-Windsor corridor, the population who can't get in and out of those major centres by car are a huge business opportunity for private investment. And when I say private investment, I don't mean privatizing the company, I mean going to private companies to fund, to build out dedicated infrastructure for passenger rail.
So a dedicated rail line and Via would share in the revenue with the private sector? How far along is that plan?
It's just at the beginning. We're just looking at how we can improve the service. To improve the service, we have to address the issue of rail congestion. To address rail congestion, you have to have your own rail. When you get into major urban areas, you share the rail with other passenger services. So then you ask yourself, how do I build that rail infrastructure? Do I go to the government? I don't think so. I think the government has done enough. It's a huge business opportunity for the private sector.
You say the government has done enough, but they build highways and other transportation infrastructure. Why can't they run a national rail service? Why do they have to pull back or share that responsibility?
I think they do run a national rail infrastructure across the country.
But why does the government need private involvement to do so?
Because I think that where there is commercial opportunity, the private sector should be taking the business risk and reaping the commercial reward. Where there is no commercial opportunity, everything west of London going out to Vancouver or going east of Quebec City to Halifax or going north to Churchill, Man., you'll never make money. That is a government service. So the government of Canada does use taxpayers money to provide that national service, but where there is a commercial opportunity, as stewards of public money, you should make sure to capture that opportunity to limit and, even better, to reduce the funding coming from the taxpayer.
In Toronto, there is Porter Airlines, which has been fairly aggressive in its pricing for the same destinations. How do you compete with that?
We don't. Via Rail is public money and public money is not meant to be competing with private capital. What's important is not just the person who goes from Toronto to Montreal, but everybody who stops and gets on in between, so our competition is the car. Between Ottawa and Montreal and Toronto, 83 per cent of the trips are in cars. Those are the people we want to get on the train.
But can you ignore a company like Porter, which is right in your backyard, travels the same routes in much less time. You said you don't compete with them but is that true?
I wish them well. I'm a public service. Why do I exist? I exist to serve the areas between Toronto, Ottawa and Montreal, that's why I exist. I exist to offer accessibility. I exist to reduce the environmental footprint. Those are the reasons a company like Via Rail exists. That's why it's a public service. So companies that provide air service are not my competition. They are not in the business of limiting cars. They are not in the business of serving Cornwall, Belleville, Kingston and the points in between.