Beijing-Shanghai HSR set to make a profit this year

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Paulus

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The financial situation of the high-speed rail link between Beijing and Shanghai is improving, with profits expected for the first time this year.

About 30 billion yuan (5 billion U.S. dollars) of tickets were sold last year, Cai Qinghua, former chairman of the Beijing-Shanghai High-speed Railway Company Ltd. told Xinhua this week.

The company is yet to release official financial results for 2014, but stakeholders in the 1,318 km line look set to rake in some 1.2 billion yuan in profits this year, following continual losses since its opening in June, 2011.

"We originally planned to achieve a financial balance in five years and recoup our investment in another 14," said Cai.

The financial situation of other major railways in China remains obscure, but it is widely acknowledged that making profits from pure passenger traffic is difficult for high-speed rail operators. The China Rail Corporation (CRC) manages the world's largest high-speed rail network and lost 5.4 billion yuan in the first half of 2014. The company has 3.4 trillion yuan of liabilities.

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Passengers have ultimately been won over by the comfort, convenience and relatively low prices that high-speed trains offer. More than 100 million trips were made on the Beijing-Shanghai line last year, up 27 percent, about an eighth of all bullet train trips in China. Average daily trips on the route rose to some 290,000 last year from 132,000 in 2011.
 
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