Earlier this year a French domestic air travel ban came into force. Journeys that could be taken by train in under 2.5 hours were cut from flight schedules. What does this mean for retailers – and has it set a precedent?

The Departures board at Paris-Orly looks a little different. Back on 22 May 2023, on the eve of a ban on many short domestic flights, Nantes, Bordeaux and Lyon would all have featured. Today, because the journeys can be completed by train in under 2.5 hours, the routes are officially grounded.

It’s a move that’s been hailed by environmentalists. According to the UK government body DEFRA, rail journeys emit around six times less greenhouse gas (GHG) emissions than domestic air travel. And the more passengers you have on the train, the greener it gets. 

The domestic air travel ban only applies where there’s suitable train capacity, so moving passengers from the air to rails should be seamless. It’s expected a clampdown on private jets is likely to follow, too. 

But there are a couple of loopholes. Firstly, one of the highest-volume domestic routes, Paris to Marseille, remains unaffected. The three-hour journey time falls just outside the remit of the ban. That’s double the 90 minutes or so the trip takes by air.

Secondly, connecting flights are unaffected. So while the ban looks good on paper, how effective will it be? And how will travel retail operations be affected?

French domestic air travel ban: Financial impact ‘unlikely’

TRBusiness reached out to both Lagardère Travel Retail and Dufry for their take. Both said it was too soon to comment on the impact of the changes. But the mood generally is that while the ban is an interesting move by the French government, it isn’t one to cause concern.

Credit rating agency DBRS Morningstar has run the numbers for a number of businesses in the sector. It predicts that there will be little financial impact on the major players.

Groupe ADP, which operates Paris-Orly, also has a footprint in other markets. It is “unlikely” the change in the law will have a detrimental effect, “given that the mainland France segment represented less than 15% of total passenger traffic in 2022,” the agency said in a statement. 

Interestingly, AirFrance may even benefit. It had already given up those three routes in the pandemic in exchange for €7 billion in liquidity support from the French government. It would be a wise move to snap up the vacant slots for international routes.

A rail boost?

It will take significant investment in rail for passengers to be lured from the skies. Journey times would have to come down significantly, with better integration between air and rail at major hubs. But France, with its well-established network of high-speed lines, could be the perfect test ground.

“If the new law is progressively extended to other flight routes, then this could benefit the state-owned passenger and freight logistics group, Société Nationale SNCF SA (SNCF), in the medium to long term,” DBRS Morningstar continued. But as it stands, culling just the three routes “is likely to have only a limited financial impact on SNCF’s turnover”.

But with investment comes possibility. “Convenience and reliability are other important factors to be considered as well,  alongside potentially growing environmental considerations from customers,” the ratings agency said. 

“We believe that short-haul, direct flights are likely to face stiff competition from existing  high-speed train journeys that can provide similar benefits to travellers – assuming there is sufficient rail capacity to take on more passengers.”

For the sustainability-minded, could there be a race between the advent of sustainable aviation fuel and meaningful development of domestic (and international) rail networks?

Fuel price crisis

Fascinatingly, there are calls from some quarters that the ban has little to do with environmental concerns at all. In fact, it’s more about the price of fuel.

“The ban on short-haul flights seems temporary,” said Ravi Parikh, travel expert and CEO of RoverPass, a booking system for RV tourism. 

“The primary objective is to tide over the fuel crisis. Therefore, I do not expect much investment in stores in railway stations immediately.” He predicts more railway station retail and F&B pop-ups, but other than that business as usual. 

There is a thought that other governments could follow France’s lead and ban short-haul flights. Has the country set a precedent?

It is possible. But even if the rail infrastructure issues are addressed, challenges remain. Most notably legal ones. Only recently was Amsterdam Schiphol’s bid to curb flight volumes ruled unlawful. There are competition issues at EU level, too.

Will France’s domestic flight ban impact GTR? In short, no. But it has highlighted that if we’re serious about the climate crisis, if governments are going to push consumers to rail, then more meaningful investment in station retail would be prudent. 

Last year, Lagardère Travel Retail North Asia CEO Eudes Fabre said the high-speed railway network in China offers significant potential but can take a ‘qualitative leap’ to improve commercial standards.