Comments on: Lyon’s Rhônexpress Project Pioneers a New Way of Thinking About Public-Private Partnerships

By: Max Wyss

Max Wyss — Thu, 01 Jul 2010 22:44:31 +0000

The way I do understand that Wikipedia article, Rhônexpess is not part of REAL (although, at the time the REAL concept was developed, nobody way talking Rhônexpress yet).

REAL is essentially bringing the commuter lines around Lyon up to what one normally expects from commuter lines (fixed interval schedules, integrated consolidated zone fare systems, connection with local buses and coordinated scheduling). In order to achieve that, infrastructure and rolling stock need to be updated.

So, Rhônexpress may be participating in the fare system and scheduling.

By: Yonah Freemark

Yonah Freemark — Thu, 01 Jul 2010 22:02:02 +0000

Yes, REAL is still in the process of being implemented, at least according to French Wikipedia. I think Rhônexpress is actually a part of the REAL project, which involves a whole series of programs to improve regional transportation.

By: Mike

Mike — Thu, 01 Jul 2010 19:14:49 +0000

Okay, just read Yonah’s writeup on the london tube PPP … it clearly did not pass the basic test of a well structured contract.

By: Mike

Mike — Thu, 01 Jul 2010 19:03:27 +0000

Well, this is a important issue that deserves more attention and discussion. There certainly are examples of private PPP firms being bailed out by government, and if this is an inevitable outcome of PPP failure, then PPP have little future. At minimum, avoiding a PPP bailout requires a well structured contract and strong political leadership that will not cave to a whining private firm. These aren’t gimmes, but it seems to me that these are quite achievable.

As for the idea that if the private partner walks away that the public is left holding the bag, I just don’t get that. Anyone who loaned money to the private partner is hosed, but that group should not include government. If the bankrupt private firm hands over a decrepit system in need of massive reinvestment then the public is hosed, but a well structured contract and diligent oversight should be able to avoid this problem. What if the private partner promised to improve an outdated system but then only gets partway through the project? Then the public is stuck completing the project on its own dime, but this doesn’t mean that the public is necessarily worse off … as long as they actually want the planned improvements.

The london underground example keeps coming up; did that PPP fail in a different manner that left the public holding the bag?

By: Alon Levy

Alon Levy — Thu, 01 Jul 2010 14:43:08 +0000

Yonah, is Lyon building Rhonexpress instead of or in addition to REAL?

By: Alon Levy

Alon Levy — Thu, 01 Jul 2010 14:38:51 +0000

Actually, the facts he cites are all correct. Japan does in fact have plenty of competing private operators, has extensive through-running from different companies’ commuter lines to the subway, etc.

The only fact that’s incorrect in the comment is “the majority of subway lines being run by a private company btw.” This is not completely true: while Tokyo Metro is run and pays taxes as a private business, it is still owned entirely by the city and national governments, pending full privatization.

However, some of the analysis in the comment is off-base. Yes, the way the railroads develop their stations helps profitability – but that includes not just retail but also massive office space construction, to turn those stations into employment hubs and increase ridership.

Honestly, give me Sean’s comment over the “Trains in Japan are just a loss leader for real estate” myth any day.

By: Chris

Chris — Thu, 01 Jul 2010 04:04:29 +0000

I think the problem with PPPs is that the private company is only ever pretending to take on the risk. I can guarantee that when it goes bad they just end up walking away and the taxpayer gets screwed. Bit like with the London tube in other words.

By: danny

danny — Wed, 30 Jun 2010 23:35:10 +0000

Okay, now how much of that comment did you make up? Im willing to guess that at least 50% of the facts you cite are complete fabrications.

By: Sean

Sean — Wed, 30 Jun 2010 22:17:30 +0000

A large portion of public transit in Japan is run by private companies. Although it’s success it probably contingent of Japan’s high population density and high mass transit usage. But it is also special because the private transit companies are very diverse. Many rail companies own large tracts of land around stations and develop them into homes, malls, department stores, etc. Some even own baseball teams and run other businesses unrelated to their transit operations. They are very diversified businesses and they’ve turned transit stations into lifestyle centers. Sometimes you hear of Japanese people entering stations for the soul purpose of just shopping or entertainment. They also cooperate with each other at an unheard of level; for instance, a private rail line starting in the Tokyo suburbs may run through on a subway line in central Tokyo (the majority of subway lines being run by a private company btw) and emerge on the opposite end of the line and run through on a different private railway’s line. So you can ride on a private rail/subway line and potentially see trains from 3 different companies at once on the same line. This does wonders for their businesses, as it increases riders, station patronage and is most convenient for riders as well. In other words, a win-win for everyone involved. I don’t know if the Japanese model would work in the West, but it very successful in Japan and has been for over 100 years.