On November 25 of last year, Iryo launched its first train from Barcelona to Madrid. It was the staging of the new operator’s entry into service after the liberalization of the high-speed market in Spain. Today, a year and a day later, the Italian parent company monopolizes 30% of the frequencies, employs 580 direct workers and is proud to have managed to surpass 25% of the market share with a “unique and “customer-focused” with which they have managed to attract more than 5.2 million passengers. The company, which is still in the business stabilization phase before turning a profit, has seen demand skyrocket for trips to Andalusia, where it has achieved an occupancy rate of 70%, the highest of all its routes. This makes southern Spain the main market with which Iryo plans to achieve the 15% growth that it has set as a goal for 2024.
“It has been a phenomenal year for us. We have worked a lot, because it is not easy to set up a company of these characteristics from scratch, but we have made a difference with a quality product at very competitive prices,” says Simone Gorini, executive director and general manager of Iryo, an operator owned by Trenitalia ( 45%), Globalvia and Air Nostrum. Gorini acknowledges that it will still take a few years for the railway company to make a profit after having invested 800 million euros in a fleet of 20 completely new trains, the Italian ETR 1000 or Frecciarossa (red arrow), manufactured between Italy and Spain by Hitachi. Rail and Bombardier Transportation (now Alstom group), with which it covers three lines: Madrid-Barcelona, ??Madrid-Sur and Madrid-Levante. In total, there are 11 connections at low cost prices to destinations such as Madrid, Barcelona, ??Zaragoza, Cuenca, Valencia, Málaga or Córdoba. Almost 9 million kilometers traveled with a global average occupancy rate of 66%.
But like any company, the objective of profits is not negotiable and therefore, the operator demands in the first instance a reduction in the railway fees that it must pay to Adif, and which according to Gorini, represent 50% of the total costs it faces. the company (they are calculated based on the places offered and not based on the number of travelers). Another 20% goes to the electricity bill. “The work that Adif is doing is very well done, we must recognize it, because it is not easy to go from one to three operators. Now, there is such a high level of fees that they do not help at all in the search for that profitability,” says the Iryo manager. Gorini explains that in Italy fees have been reduced by 40% and he asks for the same percentage reduction for Spain “in order to be profitable.”
Adif is currently working on a new fee regulation that will define and structure the rates and that could be settled next December, the month in which Iryo will launch its new Barcelona-Seville route. But for the moment there is talk of freezing prices, just as it was already done in 2022, in accordance with the words just five days ago from the president of Adif, María Luisa Domínguez, who defended that “the railway charges in Spain are aligned and, in some corridors, they are even below those established in other European markets.”
Although the liberalization of the high-speed service has led to a general drop in prices of 40% on lines where there is competition, such as the Barcelona-Madrid line, Gorini recognizes that prices “will have to stabilize” later as the operators consolidate in the Spanish railway panorama, although “they will be very competitive prices for the quality of the service offered by our trains, and with many price types.”
After the Andalusian surprise, where Ouigo, the third operator, has not yet entered, Iryo will launch the Barcelona-Seville transversal route on December 10 with 4 frequencies and stops in Zaragoza, Madrid and Córdoba. Its expansion plans do not involve entering the medium distance of high speed at the moment, but rather the routes to the north of Spain, especially Galicia and the Basque Country, at the moment when Adif gives the starting signal to the new operators to enter.
