Eurostar Adds Virgin Link, But No Multinational Corporate Deals

Eurostar has told EuroBTN it does not yet plan to start offering clients multinational corporate agreements, in spite of its Aug. 19 announcement that it will transform itself from a joint venture into a single transnational corporate entity in January 2010.

The Channel Tunnel rail service also revealed this week that it has launched an interlined e-ticketing arrangement with Virgin Atlantic, its first with an airline.

Eurostar currently has three separate sales and marketing teams—one each in the United Kingdom, France and Belgium—that report to a single commercial director. Director of corporate communications Simon Montague said the structure is likely to stay, with no opportunity at present for multinational clients to negotiate a single agreement. "The answer is no, not yet, but we will probably look at it if there is sufficient demand," said Montague. "We haven't got to this level of detail yet. However, this year, we have done a lot of work to align fare structures and minimize exchange rate differentials."

At present, 65 percent of the Eurostar joint venture is owned by French national rail company SNCF and another 3 percent by SNCB, its Belgian equivalent. The remaining third, Eurostar UK, belongs to a holding company called London & Continental Railways. The newly incorporated business will be called Eurostar International Limited, but details of its structure and shareholdings have yet to be determined.

Montague said Eurostar is incorporating itself to prepare for the deregulation of the international rail market in the European Union, which takes effect Jan. 1. "We felt we needed to put ourselves on an equal footing in response to competitors," he said.

As part of the restructuring, COO Nicolas Petrovic will become chief executive of Eurostar International. The current chief executive, Richard Brown, will become non-executive chairman, replacing Guillaume Pepy, who is also president of SNCF.

Meanwhile, Eurostar's deal with Virgin means that passengers flying into London will be able to simultaneously book a through rail ticket to Paris, Brussels or Lille. There are no Eurostar departures from Gatwick or Heathrow, the two London airports served by Virgin. Passengers will have to make their own way from the airports to Eurostar's central London terminus at St. Pancras.

Virgin Atlantic senior vice president of North America Chris Rossi this week said the deal "helps us from a network perspective," plugging the carrier's London air service into key Eurostar rail markets.

"You can book through the agency or book directly with us or Eurostar. It's almost like you're booking a carrier," Rossi said. "It's significant, because, as you know, Eurostar is the dominant mode of transport between London and Paris."

Eurostar introduced e-ticketing in March this year and has already achieved an adoption rate of 70 percent. It plans to sign interline deals with more airlines.