‘SURVIVAL’ OF VIA AT RISK
New corporate plan released
Via Rail is warning it faces longer trip times, faltering on-time performance and service cuts if it doesn’t get its own set of dedicated tracks and fleet upgrade in the busy Montreal-Ottawa-Toronto corridor, the Crown corporation says in its newly released corporate plan.
Simply put, the plan says the rail carrier’s “survival” is at risk if it has to continue operating on freight rail lines primarily owned by Canadian National Railway Co.
Via Rail is looking for federal government approval to have large pension funds invest in a $2-billion dedicated-track corridor as part of the Crown corporation’s plans for “high-frequency rail.”
Via is also seeking upwards of $1.3 billion in federal funding for new electric rail cars to renew a fleet that has long surpassed its normal life expectancy.
“Via Rail is at a critical decision point. The current operating environment whereby it operates outdated passenger trains on freight railway infrastructure can only lead to greater operating deficits and great capital requirements,” say the opening lines of the Crown corporation’s 2016-20 corporate plan, tabled in the House of Commons by Transport Minister Marc Garneau.
“There are no tactical or strategic improvements that can overcome the inherent negative dynamic of limited frequencies, poor reliability and on-time performance (OTP), longer trip times and outdated equipment.”
The rail carrier says it faces three critical issues in coming years:
Via Rail needs additional federal funds of about a third of a billion dollars each year, starting in the 2017-18 fiscal year, simply to keep the status quo network operating, “while operations and service continue to deteriorate despite the Corporation’s best efforts.” The funding shortfall doesn’t include additional costs for fleet replacement and new track, complying with new grade crossing regulations or potential security upgrades.
The Crown corporation has an outdated fleet. The average age of Via’s fleet is more than 40 years (23 years for locomotives and 43 years for cars), when the average life expectancy is 25 to 30 years. Via commissioned an independent assessment in 2015 of the condition and requirements of its Quebec-Windsor corridor fleet (200 of 495 total pieces of equipment), which found “there is an immediate and urgent need to replace the Corridor fleet because continuing to operate with the existing fleet presents a high operational risk to Via Rail.”
Via Rail owns only three per cent of the tracks on which it operates and primarily relies on CN freight rail tracks for its passenger rail service. Passenger trains in Canada don’t receive operational priority in law as in most other countries, meaning Via’s trains are often delayed by freight traffic. Moreover, the recent federal government directive to reduce the speed of the growing number of trains carrying crude oil will further slow and reduce traffic flow on rail lines, the report says.
“In general, the service provided to Via Rail by the host railways has been deteriorating and represents a large current burden and risk to Via Rail’s survival,” says the corporate plan.
Indeed, the federal auditor general reported last week that nearly a quarter of the Crown corporation’s trains were late in 2014.
Via’s annual ridership has dropped from 4.2 million passengers in 2010 to 3.8 million in 2015, something Via attributes largely to its “inability to deliver reliable, frequent and competitive travel times” on a shared track.
Via Rail is targeting large public sector pension funds for the approximately $2 billion it would cost to build the track and signalling infrastructure for a dedicated passenger rail network in the Montreal-Ottawa-Toronto corridor.
A renewed stock of diesel cars, like those currently in use, would cost just over $1 billion, while preferred electric cars would cost approximately $1.3 billion and require another $850 million for an electrical infrastructure grid. Going with the electrical option would bring the total project cost to around $4 billion (including investment from pension funds and government).
“Via Rail can no longer function within its existing framework,” says the corporate plan.
Currently, Via’s average speed in the shared Montreal-Ottawa-Toronto corridor is 103 kilometres per hour, but a dedicated track for passenger rail would see the average speed increase to between 145 km/h and 153 km/h, with a top speed of 177 km/h.
Via says a funding commitment now would mean it can reach out to the pension funds to finance the dedicated track, and that construction on the new line could start in 2017 and be operational by fall 2019.
The carrier had hoped a funding commitment for a renewed rail fleet might come in the March federal budget, but the government promised $3.3 million over three years to study Via’s high-frequency rail proposal.
Garneau, the federal transport minister, has indicated that studying the proposal doesn’t necessarily mean Via won’t get the funding it has requested for new rail cars within that time period.