Competitive Tendering of Regional and Interregional Rail Services in Sweden

This paper describes how the Transport Policy Act of 1988, with its ground-breaking split of railway infrastructure from operations, is commonly considered the starting point for the transformation of the Swedish railway system - from a vertically and horizontally integrated monopoly to a market characterized by decentralization and intramodal competition. In this paper, the authors focus on the reforms and experiences related to the introduction and development of competitive tendering of passenger rail services in Sweden. Competitive tendering was first introduced in 1989 on some regional lines, but since then this practice has become more and more widespread, and now encompasses the majority of both regional and interregional lines. The different types of tendered contracts for these services are described in some detail in the paper. Despite a general lack of bidders participating in most tenders, some important new entries have taken place, from national as well as international firms. For the procuring authorities, it has been a rather long period of learning over time how to improve the tendering process, also affected by Sweden's entry to the European Union in 1995. Although there are several positive effects to highlight, such as innovation and reduced subsidies, there is also reason to consider problems like unfulfilled bids, the predatory behavior of some bidders, and sometimes worsened possibilities for passengers to find connecting journeys involving several operators. The paper also includes some general statistical data that reflects the development of the Swedish railways in recent years.