What is the price of a bullet train?

Alfonso Llanes, studied at Florida International University

Answered just now

ECONOMIC ANALYSIS OF HIGH SPEED RAIL IN EUROPE

Paper sponsored by the BBVA Compass Foundation a leading U.S. banking franchise.

Introduction from the authors:

Javier Campos

Universidad de Las Palmas de Gran Canaria

Ginés de Rus

Universidad de Las Palmas de Gran Canaria

Ignacio Barrón

UIC – Paris

“The cost of building and operating a new high speed rail line comes from a database containing information about 166 actual HSR projects in 20 countries is analyzed in detail. This database provides a rough guide about the typical cost structure of any HSR project and suggests tentative estimates for some representative unit values of those costs. This information, together with some additional values gathered from other sources (Levinson et al. 1997; ATKINS 2003; SDG 2004, De Rus and Nombela 2007), allow us to perform a simple simulation exercise capable not only of providing an answer to the initial question, but also of offering insights on the relevance of some elements in determining the total costs of a HSR line.”

The costs are divided into two main parts: The cost structures of a given project are established by infrastructure cost and costs associated with the rolling stock.

The paper describes the large construction costs that are incurred prior to starting commercial operations therefore large outlays of capital are required in infrastructure and maintenance of the tracks including, terminals and stations at the ends of the line and along the line, energy supplying the line signaling systems, train controls and traffic management systems and equipment, etc.

There are other costs involved in the building and operation of a rail project. For instance, planning costs as well as technical and economic feasibility studies carried out before construction is started. Moreover, there are legal requirements to be met such as expropriation or acquisition by imminent domain of right of ways from current landowners, authorization from local authorities, permits and other legal issues.

In order to build a model for cost simulation the most relevant features of the project parameters have to be described like building and operating capability for a time span of 30 to 50 years for a single line model connecting two cities at a given distance and without intermediate stops and conditioned to the characteristics of the geography which in this model is consider as flat terrain in most of the area covered by the line and a construction time span of 5 years for a distance of 500 kilometers.

Commercial operation of the line must also consider the maximum operating speed, which is related to the technical characteristics of the trains, the project in general and the average commercial speed achievable. The commercial viability of the venture has to consider the number of cars for peak hours and the total supply and demand of seats for the route which will determine capacity and frequency of the train schedule.

For this particular model the authors estimate a total cost of $36 million dollars, however, as comparison the project to link up Los Angeles to San Francisco (560 kilometers) by bullet train is already projected to cost $98 million dollars.