Eurostar Group Ltd. said a surge in travel to London for 2012’s Olympic Games and Diamond Jubilee festivities will help awaken demand for the longer-distance rail services that it plans to roll out in the next few years.
Sales linked to the June celebration of Queen Elizabeth’s 60 years on the British throne are “looking strong,” while the Olympics, which begin in July, are drawing bookings from across France, Germany and the Netherlands, Eurostar Chief Executive Officer Nicolas Petrovic said today in an interview in London.
While volumes will be higher, they’ll have little impact on earnings since most extra travelers will buy economy tickets, and 2012 may be more important in stimulating longer-distance journeys, Petrovic said. More people are already linking with Eurostar’s services from further afield, and the CEO said plans to serve cities such as Amsterdam have been encouraged by delays at Germany’s Deutsche Bahn AG in beginning similar services.
“We’re selling London as the place to go, not just from Paris and Brussels,” Petrovic told Maryam Nemazee on Bloomberg Television’s ‘The Pulse.’ “We want to go to new destinations, Holland, the south of France, maybe Switzerland. We’re looking at options to get in those markets before the Germans come.”
Deutsche Bahn said in December it had been forced to push back the start of its own services through the Channel Tunnel from 2013 to 2015 due to delays in the delivery of new high speed trains from Siemens AG. (SIE) That will give Eurostar, whose longest routes are currently to Avignon and three French ski resorts, breathing space to establish itself in more markets.
Paris-based Eurostar, which is also buying trains from Siemens, is not expecting any delay to the order. “It’s all in the bag,” Petrovic said. “It’s all being built at the moment and we are expecting to have the trains delivered on time.”
First-quarter sales rose 7 percent to 211 million pounds ($336 million), Eurostar said today. Passenger numbers increased 4 percent to 2.24 million.
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