Sound financials recharge China's fast trains - MarketWatch

BEIJING (Caixin Online) -- Four of the nation's 14 high-speed rail lines have financially broken even since bullet trains started full-speed, intercity service in China two years ago, giving impetus to a Ministry of Railways expansion.

Passenger ticket revenues have so far matched expenses -- including debt payments -- for the busy Beijing-Tianjin, Shanghai-Nanjing, Beijing-Shanghai and Shanghai-Hangzhou lines, a source at the National Development and Reform Commission (NDRC) told Caixin.

Moreover, the financial health of the Beijing-Shanghai line exceeded expectations during its first operating year, which ended in June, sources told Caixin.

Some notes:

• While including debt payments, the above "break-even" figures probably still exclude depreciation (the article is a bit confusing).
  
• All specific lines discussed in the article are presently operated at 300 km/h, but the figure of "14 high-speed rail lines" includes lower-quality and cheaper 200 km/h lines. It is unclear whether Caixin had information about the performance of these. (I would expect that, for example, the busy and competition-killing Hefei–Wuhan line is profitable.)
  
• Three more 300 km/h lines were in service in early September. Of these, the long Wuhan–Guangzhou line (which crushed the airlines, too) has a relatively high ridership that (in spite of the post-Wenzhou slowdown) again grew by more than 25% in the year to date; and the opening of connecting lines to Beijing and Kowloon (Hong Kong) is to give further boost toward profitability. Those same connections should also help the remaining two lines (Guangzhou–Shenzhen, the newest; and Zhenzhou–Xi'an, the one Caixin reports as problem case).

After getting a green light from the government's chief economic planners at NDRC, the rail ministry said July 30 it would spend 470 billion yuan this year on high-speed railways. That represented a 14% increase in spending from a previous budget plan.

On the negative side, China Railways is still following a policy of high ticket prices on new lines, leading to public debate.

_{*Lunatic*, n.
One whose delusions are out of fashion.}