<B>H-P Looks To The Rails</B>
<B>Headquarters Location:</B> Palo Alto, Calif.
<B>Worldwide Air Volume:</B> $390 million
<B>Worldwide T&E:</B> $800 million
<B># Employees:</B> 83,200
<B>Innovation:</B> <I>Using high-speed rail on certain European itineraries to lower air spend</I>
Deemed inefficient, insufficient and uncomfortable in the United States, rail service has made great strides in Europe and at least one travel manager on this side of the pond has taken notice. Kevin Iwamoto, global air and car travel supplier manager at Hewlett-Packard Co., along with the company's European travel management team, is exploring the cost-savings potential and encouraging travelers whenever feasible to use high-speed rail connections for certain itinerary legs. "If you have a city-center to city-center alternative and it takes only an extra hour or so but costs half of what available airfares are, you have to look at it," Iwamoto said.
French national railway operator SNCF has made the most progress in aligning with airlines, mainly via connections at Paris Charles de Gaulle, and now offers joint ticketing by way of codesharing with Air France, American, Lufthansa and United Airlines. The rail carrier links Paris to several French cities, including Lyon, and Brussels, Belgium, with its TGV high-speed trains, and offers traveler incentives such as through baggage checkin and frequent flyer points.
"Before, it was pretty automatic that if you were going to Lyon, you were flying there," Iwamoto said. "But now, with airport connections in Paris, it's very realistic to connect to the high-speed rail and train it up to Lyon." For H-P's transatlantic travelers, that could mean a long-haul flight on United Airlines to Paris, a quick transfer within the airport to the train station and a two-hour bullet train ride to Lyon. Iwamoto added that some local European H-P business groups already are using the rail alternative and one of the ongoing global strategic sourcing projects for his European counterparts is to examine the opportunities available for increased usage. "We are still analyzing the service and it may not be appropriate for one-day trips, but there may be some opportunity there," he said.
Furthermore, some H-P travelers choose the train option even on routes where there is decent competition among airlines. "Some of our U.K.-based travelers use the rails to go to Brussels as a cost-saving measure even though lower cost airlines like Virgin Express serve that market," Iwamoto noted.
Indeed, while the Eurostar rail option between London and Brussels costs more in some cases than Virgin Express, it beats British Airways by more than $150 on a roundtrip, midweek itinerary. Meanwhile, between Paris and Lyon, the fare on SNCF's TGV is only $77 or $104 in first class.
Underscoring the increased attention on trains for business travel, WorldTravel Partners in February signed the first national preferred agreement with Rail Europe, an organization of more than 40 European state rail carriers. Rail Europe also recently established a business travel services call center for U.S. travelers.
"Taking into account extra time for getting to and from airports and weather problems, high-speed rail is an equal if not better option than flying if the trip only is a few hours," said John Haisley, manager of industry relations at WorldTravel Partners. "Any American business traveler that tries it is generally pleased." Haisley noted that the Eurostar connection between London and Paris accounts for more than one-quarter of WTP's sales of Rail Europe services.
Although the distance between most business destinations in the United States makes rail transport prohibitive, Amtrak is pressing ahead with its high-speed system in the Northeast corridor, the only domestic region where rail is even considered for business travel. Indeed, Acela trains by this summer will be zipping between Boston, New York and Washington, though it remains to be seen how appealing it will be to business travelers and travel buyers. Historically, Amtrak's city-center to city-center convenience often is counteracted by business traveler assumptions--some accurate, some not--regarding poor comfort and service levels.
However, Europe's rail systems are years ahead in terms of infrastructure and reputation and already offer fast, reliable service throughout France, Germany and from the United Kingdom to the mainland via the Eurostar Channel tunnel line. Furthermore, a recent intermodal agreement signed between France and the United States allows airlines to more easily offer transportation options combining air travel and rail service (<I>BTN,</I> Nov. 1, 1999).
"As air costs, air traffic and airport congestion accelerate," Iwamoto said, "you would be remiss not to look at it.