France’s first rail co-operative Railcoop is now selling travel vouchers which customers can redeem against train tickets. The co-op plans to launch its first passenger line between the cities Bordeaux and Lyon in the summer of 2024.
The train would stop in 10 other cities along the way: Libourne, Périgueux, Thiviers, Limoges, Saint-Sulpice-Laurière, Guéret, Montluçon, Gannat, Saint-Germain-des-Fossés and Roanne. In doing so, it would cross seven administrative departments to connect the Nouvelle-Aquitaine and Auvergne region with the Rhône-Alpes region, covering 626km.
Railcoop plans to offer a round trip per day. The co-op expects the ticket prices to range between €35 and €55 for the journey from Lyon to Bordeaux.
“Our objective is to demonstrate the citizen mobilisation of the territories, to prove to our financial partners that Railcoop’s offer is expected. And we want to be able to refund you if you are not satisfied with our offer or if, for whatever reason, the line could not see the light of day,” said the co-op.
Set up in 2019, Railcoop is a co-operative society of collective interest (SCIC) with over 14,000 member owners. The co-op had planned its first passenger service for 2022 but the process was delayed by Covid-19.
Earlier this year Railcoop’s board of directors voted to suspend its freight activities in order to concentrate its resources on the launch of the Bordeaux-Lyon line. The co-op has also launched two fundraisers, a share offer via its site, and an equity securities offer via the Lita.co platform through which it aims to raise €4.1m in 2023 in order to cover the necessary investments, particularly the purchase of an additional X72500 three-coach train.
In recent months several French media outlets have questioned the co-op’s ability to raise sufficient funding and become financially sustainable. Alternatives Economiques, a co-operative media organisation which is member of Railcoop, claimed the latter is “going through a long tunnel, with no real prospect of seeing the end of it”.
Railcoop was able to raise the required €300,000 (£256,000) before the end of July, which was necessary to secure cash until the end of the summer. According to the co-op, the next step will be to raise €500,000 (£341,000) by the end of September to ensure the operation of the co-operative until the end of the year.
“Railcoop is indeed exploring all avenues to help secure the future of the co-operative and investments in the next lines, starting with Bordeaux – Lyon. And, in particular, Railcoop is exploring the partnership with an investor, specialised in ecological and responsible investments, to co-finance the purchase and renovation of the trains, and share the risk of the commercial operation of the Bordeaux – Lyon,” a spokesperson told Co-op News.
Railcoop confirmed it is facing financial difficulties via its website but said this was normal for this stage in the life of the project.
“Creating a railway company in three years is a colossal and costly challenge,” it stated, adding that its members had provided it with the funds that allow it to bounce back and seek financial partners. The money collected via the sale of vouchers will not be spent and will be refundable, said the co-op, adding that the sale of travel vouchers is not intended to replenish its coffers but to prove the expectation of the territories.
“Our entire team is working on the opening of Bordeaux – Lyon: to facilitate this work, we need the support of our future users,” it said.
In an interview with BFM Business, the co-op’s CEO, Nicolas Debaisieux, said the business had reached its fundraising objectives for June and July and that everything was still on track for launching the passenger line in 2024. He mentioned other difficulties faced by the co-op along the way, such trying to arrange for trains travel between East and West when the network is not currently organised to accommodate this.
Another challenge, said Debaisieux, is competing with SNCF, France’s national state-owned railway company, to which Railcoop has to pay a fee to run its trains on the rails. Debaisieux said these royalties represented a quarter of Railcoop’s operating expenses but added that the cost was still relatively low due to Railcoop using regular lines, not TGV (high-speed train) ones.
More than 1,500 travel vouchers had been purchased by 7 August. “The campaign will intensify throughout the summer, until the end of September,” said the co-op’s spokesperson.
This article was amended on 7 August to include additional comments from a Railcoop spokesperson.
