LONDON (AP) — Eurostar International Ltd., which operates high-speed trains between London and the European continent, said Thursday it will buy 10 new trains from German manufacturer Siemens in a 700- million-pound ($1.1-billion) program to upgrade and expand its fleet.
Eurostar said the new 900-passenger trains would be capable of operating anywhere on Europe's high-speed rail network, as the company looks beyond its current destinations of London, Paris and Brussels. Details of the contract remain to be negotiated, Eurostar said.
New destinations are at least four years away, when the new trains are delivered, but possibilities include the Netherlands, western Germany, Geneva and the southern French city of Lyon, Eurostar Chief Executive Nicolas Petrovic told a news conference.
"Our sights are now set on expanding our business across Europe," he said. "The transformation of Eurostar into a standalone business and the major capital investment announced today is a mark of our growth ambitions for the future."
The Siemens trains can travel at 320 kph (200 mph) per hour, potentially cutting the London-Paris journey times to just over 2 hours, compared to the current two hours, 15 minutes, Petrovic said.
It's the first big project for Eurostar International, the limited company that succeeds the British-French-Belgian partnership that launched service through the Channel Tunnel in 1994.
The French rail company SNCF owns 55 percent of Eurostar, British government-owned London & Continental Railways holds 40 percent and Belgium's SNCB has 5 percent.
As part of the reorganization, Eurostar's owners promised to make slots available on their lines for competing high-speed services.
Petrovic said Eurostar is generating a profit without government subsidies, and will finance the improvement program with its own cash and commercial loans.
"We didn't find it too difficult to find some interest from the banking sector," Petrovic said.
This year, the European Commission opened the way for any rail to bid for rights to operate trains anywhere on the high-speed network.
Later this month, Germany's Deutsche Bahn plans to test one of its high-speed trains on a run through the Channel Tunnel as it contemplates opening direct service between London and Germany.
Eurostar says it now commands 80 percent of the travel market between London and Paris and between London and Brussels.
The choice of Siemens rather than the French bidder, Alstom, was politically sensitive.
"Is there anything left on these trains that is French?," a reporter for Radio France asked at the news conference.
Petrovic said it was a purely commercial choice.
"It is all about the commercial benefit to Eurostar. It is a question of benefit to the customer," said Petrovic, who began his rail career with SNCF.
Alstom said Siemens' winning bid did not meet current safety regulations for Channel Tunnel operation.
"Alstom underlines, as the French Ministry of Transport has already done, that the current security rules applying to trains traveling through the Channel Tunnel conform to the highest possible standards and consequently do not permit the use of the trains that Eurostar states it has purchased," Alstom said.
Safety rules are set by the Channel Tunnel Safety Authority, an Anglo-French body
Petrovic saw no impediment to proceeding with the Siemens contract.
"As far as we are concerned there just a few legal issues to complete," he said, predicting that a contract would be signed within weeks.