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Summary of our market study
The French motorway concession market is worth around €11.6 billion
The global motorway concession market, and France in particular, has seen several important trends and challenges since 2020. The market slowed down in 2020 due to the economic impact of the COVID-19 pandemic, resulting in near-stagnation in traffic and a drop in sector sales of around €2 billion.
Despite this downturn, the market continued to grow, driven by demand for electronic toll collection subscriptions and toll price increases in line with the consumer price index.
France, where three major players - Vinci, Eiffage and Abertis - dominate the market, has had to contend with macroeconomic factors such as the elasticity of motorway traffic to GDP, with a long-term variation of 1.2% to 1.7% for a corresponding variation of 1% in GDP.
The increase in toll rates in 2022 was a response to the high inflation rates of 2022-2023, and although a real increase in toll ratesage is not expected before 2025, regulatory guidelines have been put in place to ensure that toll changes do not exceed specified limits.
Freeway concessionaires have faced major environmental and technological challenges. They have invested in solutions such as plant-based biosphalt and the construction of ecoponts.
Electronic toll collection saw a growth in subscriptions, with Liber-t for light vehicles and Tis-pl for heavy goods vehicles.
The static national car fleet and changing consumer preferences towards alternative, environmentally-friendly modes of travel.
With a significant part of the French motorway network under concession, and the imminent expiry of the main concessions in the 2030s, the market is at a crossroads that could see major change and the possibility of nationalization similar to that in Spain.
Dynamics of the French freeway concession market
The French freeway concession market has seen a sharp decline in its main source of revenue, motorway traffic. The slowdown in 2020 was marked by a sharp drop of almost 2 billion euros in the sector's overall sales.
After this period, the market rebounded. This recovery was fueled by strong demand for electronic toll collection subscriptions and an increase in toll prices.
The market is segmented: business customers mainly belong to the CI 3 and CI 4 vehicle categories, while private customers use lighter vehicles in the CI 1, CI 2 and CI 5 categories.light vehicles dominate freeway use, outnumbering heavy vehicles by around five to one.
Despite higher tolls for commercial vehicles, passenger vehicles contribute a greater share of revenues, accounting for between 7 and 8 billion euros, or around 66% of sales, compared with 3 to 4 billion euros for heavy vehicles.
Demand is closely linked to the country's economic health, with the long-term elasticity of motorway traffic to GDP estimated at between 1.2% and 1.7% for a 1% variation in GDP. This sensitivity is more pronounced for heavy goods vehicle traffic, which is directly influenced by economic fluctuations and changes in toll rates.
Fuel prices also play a key role, with a 1% increase in oil prices resulting in a 0.33% decrease in vehicle volume per kilometer.
Seasonal trends have a considerable impact on the market, with a marked increase in traffic during the summer vacations.
Technological advances have brought a new dynamic to the market, with electronic toll booths replacing traditional toll booths.
In France, 3 behemoths - Vinci, Eiffage and Abertis - dominate the market.
- Vinci: market leader
- Eiffage: France's second-largest player
- Abertis: international player and its French subsidiary Sanef
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Summary and extracts
1 Market overview
1.1 Definition and scope of study
The announcement of the 2024 budget by current Economy and Finance Minister Bruno Le Maire has created a climate ofa climate of concern in the motorway concession marketwho will see their excess profits heavily taxed. With a large number of motorway concessions due to expire in the 2030s, a showdown between the French government and the SCAs (Sociétés Concessionnaires d'Autoroutes), recently decried for their excessive profitability, seems inevitable recently criticized for their excessive profitability.
This study covers the various stages in the value chain, i.e. the segments of constructionconstructionfreeway maintenance/operationas well as the electronic toll subscriptionsall of which are subject to dominated by private motorway concessionaireswhich control over 90% of the French market.
The global market, which is not conducive to dynamic competition, contrasts with a domestic market where public and private players coexist, marked by strong growth for the three incumbent companies marked by strong growth for the sector's three vinci, Eiffage and Abertis. This is a market at risk of saturation, but one in which the imminent expiry of the main concessions could reshuffle the cards.
This particularly polluting market must also face up to environmental and technological challenges environmental and technological challengesbut also to a demand whose many determinants point to an unstable future unstable future for the three dealers, who currently enjoy relatively stable revenues.
1.2 A relatively landlocked global market
In the absence of data on the size of the global freeway market, statistics on the maintenance and construction markets for roads and freeways worldwide will be presented by default.
Trends in the size of the global road and freeway construction and maintenance market France, ****, in billions of $ Source: ****
The specificity of the global freeway market is the relative relative compartmentalization of national markets. Indeed, although multinational companies may be in charge of concessions in several countries around the world, their presence will always be very much in the minority compared with national concessions. For example, Vinci, France's leading concessionaire and the world's second-largest concession and construction company, is responsible for just *,*** km of roads in ** countries (***). This phenomenon is largely explained by the payment system for freeways which, in many cases, are not subject to concessions, are not subject to concessions and are therefore free of charge or subject to payment by vignette, considerably limiting the advance of the major concessionary groups in these countries. On the other hand, freeways are often subject to national national preference in terms of the concessionaires authorized to operate them, due to the dependence of a country's economy on its freeways.
Top ** countries in ...
1.3 A European market dominated by French dealers
Top ** countries in terms of motorway network length European Union, ****, in km Source: ****
With the exception of Turkey, which would be in *th position in this ranking, the countries of the European Unionricher than the rest of Europe, with a few exceptions, dominate the ranking european countries in terms of motorway network length. On a case-by-case basis, a number of factors help to explain Spain's *st place, such as its advantageous topography, the historic presence of toll roads or the use of European funds to build its network, or Germany's second place, marked by a strong car culture and a central position in the European motorway network.
Source: ****
The European Union market is quite limited in terms of opportunities for the various private concessionaires: only seven of the ** EU member states have a toll motorway network. It should be noted, however, that some of the countries presented here as having a free motorway network are in the process of not renewing their concessions, as is the case in Spain, where ****km of its motorway network is currently under construction.seau autoroutier est par exemple encore concédé à la société Abertis (qui possède par ailleurs SANEF et SAPN en France. ...
1.4 Domestic market
Growth in the size of the motorway concession market France, ****, € billion Source: ****
The motorway sector has not escaped the economic economic consequences of Covid-**its main source of revenue being directly linked to motorway traffic, which came to a virtual standstill for part of ****, marked by a fall of almost * billion in the sector's overall sales. Excluding this parenthesis, the size of the market appears to be growing continuous growthboosted by sustained demand for sustained demand for electronic toll subscriptions and by the rise in the consumer price index which has prompted concession operators to offer ever-higher toll prices over the past two years.
2 Demand analysis
2.1 Typology of demand
TheTransport Regulation Authority (***) defines the different classes of vehicle corresponding to a given tariff in the following way:
Class CI *: Light vehicles Class CI *: Commercial vehicles and motor homes Class CI *: Two-axle trucks and coaches Class CI *: Other trucks and coaches Class CI *: Motorcycles
Toll rates are progressive, with the exception of class CI *, which has the lowest toll rate.
Customers of motorway manufacturers and dealers fall into two groups:
The business customers (***), mostly represented by CI * and CI * classes The private customers (***), who travel in lighter CI *, CI * and CI * vehicles
Average daily traffic France, ****, in vehicles/day Source: ****
Assuming that B*C customers are largely over-represented in the first category, and B*B customers in the second, we can see that light vehicles are more likely to be used by B*C customers than by B*B customers.gorie, we can see that light vehicles are about * times more present on freeways under concession than heavy vehicles. However, before we can draw any conclusions about the share of B*B and B*C customers in motorway concession sales, we need to cross-reference these statistics with the tariffs charged for the different classes of vehicle.
CI * class CI * class CI ...
2.2 Demand affected by macroeconomic factors
In a report commissioned by the ASFA, Associés en Finance identifies * major risks determining demand and weighing on dealers.
Elasticity of demand to French economic health.
Source: ****
By aggregating these statistics at national level, we obtain a long-term variation in motorway traffic of *.*% to *.*% per *% variation in GDP. These variations in GDP have a twofold consequence for concessionaires, particularly with regard to heavy goods vehicle traffic, which is more sensitive to the economic climate, since in addition to travelling less than when the country is experiencing economic growth, the increase in toll rates will have an even greater impact on their willingness to use freeways rather than, for example, national roads.
Oil price elasticity of demand
According to a study by Hajera Bouguerra and Christophe Rizet presented by HAL Golden Science, for every *% increase in the price of oil, the volume of vehicles on the road per kilometer falls by *.**%.
Consumer preference for an alternative mode of transport
Evolution of the average French vehicle fleet France, ****, in thousands of vehicles Source: ****
Passenger cars Light commercial vehicles Heavy goods vehicles Buses and coaches Total **** ** *** * *** *** ** ** *** **** ** *** * *** *** ** ** *** **** ** *** * *** *** ** ** *** **** ** *** * *** *** ** ** *** **** ** *** * *** *** ** ** *** **** ** *** * *** *** ** ** ***
It is clear here that the trend has been towards stagnation for the past * years. Worse still, ...
2.3 Seasonality of demand
Percentage of French people who went on summer vacation who stayed in France. France, ****, in Source: ****
Despite very high freeway traffic levels during the summer vacations, the downward trendhowever, this was offset by a **% increase in international arrivals, according to the same study. The holiday remains a reliable source of revenue for motorway concessionaires, who are able to attract a large proportion of holidaymakers who do not travel by train.
dfghj Top * French summer vacation destinations France, ****, in Source: IPSOS These data show a trend that has been confirmed in previous years: the preference of the French for the coast during the All Saints and summer vacations. One of the particularities of the motorway concession market is its seasonal nature seasonality, which has different impacts on different concessionaires. Vinci is the main beneficiary of the summer vacation peaks, thanks to its position along the entire coastline from southern Brittany to the French border with Italy.eiffage, on the other hand, takes advantage of its quasi-monopolistic position in central-eastern France to attract holidaymakers to the mountains, particularly during the winter vacations.
Evolution of interest in the "Ulys" search engine France, ****-**** Source: ****
This cyclicality of demand is confirmed by interest in the ...
3 Market structure
3.1 Value chain
Source: ****
3.2 Workforce and production processes
Workforce trends for the three main players in the motorway concession market France, ****, in number of employees Source: ****
Motorway construction sites have a nomadic componentby definition, part of employment will be determined by the peaks in activity of the companies that win their tenders. This is the case for Eiffage: this phenomenon explains the sudden increase in its workforce in ****, corresponding in particular to the construction of the A** in the Allier region, which required the presence of *,*** people.
However, the impact of these peaks in activity on employment seems marginal, in view of the the steady decline in the number of employees in the sector over the past five years.
There are many possible explanations for this, the most topical of which are the following the gradual replacement of traditional toll booths by electronic toll booths which no longer require ticket offices.
It is interesting to note that the top * concessionaires account for almost all of the **,*** employees in the French motorway concession sector [***]
As regards the production and distribution stagesmost mineral aggregates come from France itself, and the distribution network at this stage is almost entirely integrated by the main concessionaires. The other component of asphalt, bitumen, is a ...
3.3 A national market conducive to concentrated competition
Share of French motorway network under concession France, ****, in Source: ****
With concession rights for three-quarters of France's freeways, SCAs enjoy one of the most lucrative markets in the countryone of the most lucrative national marketsthis easily explains France's third place in the European ranking of countries with the most developed motorway network.
The French market has historically been dominated by three historic players: Vinci, Eiffage and Abertis. This can be explained by the adoption of the **** law, which entrusted freeway construction and maintenance to these three private-sector players, due to a lack of resources on the part of the State. Despite the opening up of the market to competition for the award of concessions, the complexity of the regulations and the undisputed first-mover position of the top * SCAs mean that barriers to entry are very high. Despite all this, the expiry of the major concessions in the ****s could change the situation, if France decides to follow in the footsteps of its Spanish neighbor by nationalizing the concessions, or decides to entrust sections of the current major concessions to smaller players.
Distribution of freeway mileage between the three main concessionaires France, ****, in Source: ASFA Comparison of motorway sales for the three ...
4 Offer analysis
4.1 Offer typology
Typology of electronic toll subscription prices for the top three dealerships (***). Each major dealer also offers a Liber-t vacances service, enabling customers to top up their accounts with vacation vouchers. It's important to point out that electronic toll badges have a queue-breaking value, in addition to offering certain other advantages, but do not exempt the motorist from paying the toll itself.
Source: ****
4.2 Toll rate increases
Annual change in toll rates France, ****, in Source: ****
The sharp rise in toll rates is a reaction to the high inflation high inflation in ****-****after a drop in prices caused by Covid-**.
Despite this, on November **, the government announced an increase in motorway tolls, scheduled for February *, ****, with a rise of less than *%, to the dismay of the concession companies.freeway concession companies, as they wish to pass on the future tax on long-distance transport, provided for in the Finance Bill (***) ****, to toll rates. Thus, a a real increase in toll rates is not expected until ****according to a study by Capital.
4.3 The technological challenge
With the arrival of electronic toll collection in France in **** a whole new market has opened up a whole new market for motorway concessionaires, who are taking advantage of motorists' desire not to have to wait and pay at the counter to invest in this sector. At the same time, this allows dealers toreduce staff costswith the gradual replacement of booths by electronic toll payment terminals.
Number of Liber-t pass subscribers France, ****, in thousands Source: ****
Number of Tis-pl pass subscribers France, ****, in thousands Source: ****
The Liber-t pass concerns users of light vehicles, while the Tis-pl pass concerns users of heavy goods vehicles (***). The number of season tickets in service has multiplied by more than *.* in * years for light vehicles, and by * years for heavy vehicles, testifying to a growing demand for and supply of season tickets. However, the growth of this market needs to be weighed against the size of the French car fleet which, while not shrinking, is becoming increasingly stagnant stagnant.
4.4 The environmental challenge
The intense pollution caused by construction and maintenance work, as well as by the passage of cars on the freeways, means that the sector finds itself at the at the heart of ecological issues.
Environmental expenditure generated by motorway concession operators France, ****, € million Source: ****
Faced with the problem of bitumen emissions, Eiffage has begun testing a new plant-based new plant-based asphalt mix with over **% recycled content, Biosphalt, on a section of the A**, the first entirely carbon-free freeway section. Vinci, for its part, reuses **% of asphalt aggregate residues from various works in its freeway maintenance and widening projects.
Main contributors to the ** million tonnes of CO* emitted by the motorway sector France, ****, in Source: ****
Despite this, these changes have a impact on total pollution emissions from the motorway emissions from the motorway sector, given that maintenance and development only account for *% of total emissions in ****.
In order to take action on this emission item, ***,*** electric vehicle charging stations had been planned for ****, but could not be implemented in ****. It's important to remember that, according to a survey carried out by Speedy, **% of French people cite the lack of electric charging stations for long journeys as the reason for their refusal to ...
5 Regulations
5.1 Motorway regulations and tariffs
TheWorld Road Association (***) lays the foundations for a regulated definition of a freeway:
"A road specially designed and built exclusively for automobile traffic, which does not serve neighboring properties and which :
Except at singular points or on a temporary basis, has separate carriageways for both directions of traffic, separated from each other by an uncirculated median or, exceptionally, by other means ; Does not cross a road, freeway, railroad, tramway or footpath; Is specially signposted and reserved for certain categories of road vehicles
The existence of concessions is governed by law **-*** of April **, **** which introduced the concession system and the right of SCAs to charge tolls to charge tolls to finance freeway sections under concession. Freeways remain the State's public domain.
Decree no. **-** of January **, **** provides a framework for annual changes in toll rates which must not exceed **% of inflation in the case of rate increases. Every five years, a plan contract between the French government and the concessionaires, which sets the terms and conditions for tariff increases, and may also provide funding for unforeseen additional investments. Pricing by recent concessionaires (***) is subject to even more complex regulations.
As the French Ministry of Ecological Transition points out, with the ...
6 Positioning the players
6.1 Positioning the players
Source: ****
- ASF Autoroutes (Vinci Groupe)
- APRR
- SANEF
- Cofiroute (Vinci Groupe)
- ESCOTA (Vinci Groupe)
- ATMB
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