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Rival Travel Services Battle for Passengers (November 20, 2003)

Shinagawa Station
The new Shinagawa Station makes travel easier. (Jiji)
With the opening of a new station on the Tokaido Shinkansen (bullet train) line in Tokyo on October 1, the competition for passengers between rail and air services has intensified, with two major bullet-train routes, the Tokaido (Tokyo to Osaka) and Sanyo (Osaka to Fukuoka) lines, giving the airlines a serious run for their money. Japan Railways firms have not only increased the number of the fastest trains running but also dropped the prices of some tickets. Seeking to preempt JR's offensive, domestic airlines have expanded the discounts available on flights. The airlines have had the upper hand over the Shinkansen for about the past five years, but it remains to be seen which side will come out on top this autumn. Either way, passengers are sure to reap the benefits in the form of lower fares and greater convenience.

New Station, More Departures, Lower Fares
Shinagawa Station, the first new station to be built on the Tokaido Shinkansen line in 15 years, lies immediately to the east of the existing JR Shinagawa Station, which is located about 7 km southwest of JR Tokyo Station. The opening of the new station gives passengers in Tokyo an extra option when traveling by bullet train. Another benefit is that if train schedules were to be disrupted by a natural disaster or some other event, Shinagawa Station's ability to serve as a extra terminal to complement Tokyo Station would enable operators to get services back to normal more quickly.

Bullet trains of the Nozomi class cover the distance from Tokyo to Osaka (about 550 kilometers) in just two and a half hours. According to a JR spokesperson, the October 1 timetable revision makes Nozomi trains the core of the Tokaido Shinkansen schedule, a position previously occupied by the Hikari trains, which take about half an hour longer to complete the journey. The number of Nozomi departures has been increased to 137 per day, 1.8 times more than before. There are now seven Nozomi departures per hour during the morning and evening peak times, compared with the previous three. Because the number of through trains linking the Tokaido and Sanyo Shinkansen lines has been increased by a similar margin, the number of bullet trains that stop at Okayama and Hiroshima stations has doubled as well.

Under the Nozomi fare reduction, the price of a reserved seat from Tokyo to Shin-Osaka on a Nozomi regular-class car has been cut from ¥14,720 to ¥14,050 ($133.8 to $127.7 at ¥110 to the dollar), a 4.6% decrease. Furthermore, the Nozomi trains, on which all seating was previously reserved, now each have three cars of non-reserved seating. The fares for these Nozomi non-reserved seats are the same as for the other classes of train on this line, the Hikari and the Kodama (which stops at every station).

As well as offering increased convenience and lower prices, the Tokaido Shinkansen has become faster. As of October 1, the Hikari and Kodama trains are capable of traveling up to 270 km per hour, up from the previous 220 km per hour. Some of the Nozomi trains, meanwhile, are capable of traveling up to 300 km per hour. The Type 100 Series trains adopted in 1985, which can only go up to 220 km per hour, were retired in mid-September. All the trains now operating on the line are from the latest generation of bullet train.

Airlines Counter with Shuttle Discounts
In order to preempt the Shinkansen discounts, in September Japan Airlines System and All Nippon Airways, Japan's two leading passenger airlines, reduced their fares on routes that compete with Shinkansen services. Both firms have cut the price of round-trip shuttle flights on their Tokyo-Osaka routes by 5.5%. At ¥13,700 ($124.5) each way, this fare is ¥50 cheaper than a reserved seat on the Hikari. And books of tickets for air travel on the Tokyo-Okayama and Tokyo-Hiroshima routes have been discounted by 23.9% and 14.8%, respectively.

A survey by the Ministry of Land, Infrastructure, and Transport found that the airlines have been increasing their market share of travel between Tokyo and Osaka, Okayama, and Hiroshima since fiscal 1997 (April 1997 to March 1998). While the Shinkansen still holds the upper hand on the Tokyo-Osaka and Tokyo-Okayama routes, the airlines took the lead on the Tokyo-Hiroshima route in fiscal 1998.

It was the airlines that struck the first blow in this air-land battle. The airline deregulation of 1996 gave the airlines the freedom to set their own fares within a certain range, allowing discounts of up to 25% on standard fares. This fostered the spread of discount programs. In 2001, three airline companies - Japan Airlines Co., ANA, and Japan Air System - cooperated in introducing a system of shuttle flights that allows passengers to fly between Tokyo and Osaka without making reservations. By increasing the number of flights and adjusting departure and arrival schedules, the airlines shaved waiting times. They also made shuttle fares on these routes cheaper than Nozomi train fares. Under attack by the airlines, JR has been steadily losing Shinkansen passengers.

But the Shinkansen is not the only land-based contender in the battle between land and air. Since 1987, when Japanese National Railways was privatized and divided into the Japan Railways group companies, the JR firms have raised neither Shinkansen fares nor regular train fares, so their fares have seemed reasonable. But private railways and bus lines in every region have been stepping up their efforts to steal passengers from JR. In big cities and tourist hotspots, travelers can choose from multitudes of competing discounts and services, such as excursion tickets and one-day unlimited travel passes.

Foreigners visiting Japan, meanwhile, can purchase various kinds of Japan Rail Passes, which offer unlimited travel on JR services for a specified period. Japan Rail Passes are valid for travel on the Kodama and Hikari Shinkansen trains as well as regular trains.

With so many different players competing for passengers, there are plenty of bargains around in the Japanese travel market.

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Related Web Sites
"Transportation" in Japan Access
Japan Railways
Japan Airlines System
All Nippon Airways
Ministry of Land, Infrastructure, and Transport
Japan Rail Pass

Copyright (c) 2004 Web Japan. Edited by Japan Echo Inc. based on domestic Japanese news sources. Articles presented here are offered for reference purposes and do not necessarily represent the policy or views of the Japanese Government.

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