If you build a high-speed rail line, will there be riders?
Not necessarily. An article in Mass Transit magazine reports that a brand-new high-speed rail service between Shanghai and Nanjing, operated by the Shanghai Railway Bureau, had to be suspended indefinitely on July 11, only days after the line had been opened. Tickets for the high-speed service cost 57 percent more than tickets for regular rail service. However, a route that passed through rather than around intervening cities and a schedule that required stops in those cities on most runs resulted in a average trip time for the high-speed service that was not significantly quicker than that of the regular service. The result was empty seats and lost revenue.
Samuel Staley of the Reason Foundation comments at the Out of Control Policy
"The story seems to be that rail serves specific transportation markets, just like all other transportation modes, and the Chinese missed the market.
They developed a luxury rail line, priced it at luxury levels, and found the demand wasn't there to support it....
"The line's closing is a stark reminder that wishing for something to happen doesn't mean it will. In the end, any program or activity's success depends on patrons to be successful. Fads do not create growth, even when the latest technology is used to promote it."