German railway scraps plan to run intercity busses
The German state-owned railway Deutsche Bahn said Friday it has abandoned a project to offer inter-city German bus service.
The rail operator "carefully examined again the risks and opportunities" of launching service in what could become a very competitive market, but chose "to take its distance with an investment of several million" euros, a statement said.
"In the interest of our clients, staff and shareholder (i.e. the German state), we will not take needless risks and will instead focus on our core business," Bahn executive Ulrich Homberg was quoted as saying.
Germany wants to subject the inter-city bus sector to more competition by dusting off regulations that date from the 1930s and have restricted service.
Deutsche Bahn already operates some regional bus lines and was expected to become a player nationwide.
But the railway operator must also deal with mechanical problems affecting its high-speed and suburban trains, and is currently focused on linking Germany with London via the Channel tunnel.
Plans to privatise the company remain in the drawers, meanwhile.
The railway operator suffered an additional setback recently when a court rejected a Bahn complaint against a bus company that organises collective trips between major cities via the Internet.
The ruling found that activity did not violate competition laws, suggesting the sector could become attractive to low-cost operators.
© 2011 AFP