Intercity Rail Fares After HSR Liberalization in Spain: The Madrid-Barcelona Corridor

This paper analyses the evolution of the prices of intercity high-speed rail (HSR) services operated by the Spanish public company Renfe on the Madrid-Barcelona route between April 2019 and June 2022. This period marks one of the most important events in the recent history of railways in Spain: the end of Renfe's monopoly and the opening of this and other corridors to private competitors. Our main objective is to study the impact of the entry of the first competitor, Ouigo, on the incumbent's pricing strategy. Our analysis confirms that Renfe perfectly anticipated Ouigo's entry and adjusted its prices about four months before the market opened. Interestingly, the incumbent also modified its tariff structure in advance according to the willingness to pay of the target customer. These results may be of interest for the forthcoming liberalization of other inter-city corridors.