Leo Express sues Czech Railways due to low prices
Today, the private railway carrier Leo Express sued České dráhy (ČD) for the results of the below-cost price on the Prague – Ostrava route. According to Leo Express, ČD is thus trying to push competition out of the market. The company is demanding compensation for lost profits in the amount of 418 million crowns. However, Czech Railways refuses.
Leo Express director Leoš Novotný claims that ČD finances its loss on the route to Ostrava from other subsidized routes. According to an independent expert opinion commissioned by Leo Express, Czech Railways should, on average, charge at least 380 crowns for a ticket on the Prague – Ostrava route and even 1190 crowns for Pendolin to cover at least removable costs.
ČD: The only one who knocked down the prices was Leo Express
However, Czech Railways claims that they did not commit any illegal actions. “The only one who reduced prices to 100 crowns was Leo Express. Czech Railways did not take part in it, “Petr Šťáhlavský responded for the railway’s spokesman.
If he now wants to order a ticket from Prague to Ostrava, it will cost 295 to 329 crowns without a discount or benefit, according to the ČD website. According to Novotný, the disparity is also evident in the prices charged on other subsidized routes, where ČD still has no competition. “From Prague to Nymburk, passengers will come one kilometer for a crown of fifty, while to Ostrava for sixty pennies,” he said.
“We consider the current infringement of ČD to be a mistake of the previous management of Czech Railways, which exposed the current management to a very risky position from the point of view of the liability of statutory representatives,” Novotný added. He allegedly told the CEO of ČD Daniel Kurucz and the Minister of Transport Antonín Prachař about the planned lawsuit.
The conduct of Czech Railways is already being investigated by the Antimonopoly Office
In addition to Czech Railways and Leo Express, RegioJet also runs from Prague to Ostrava. The Office for the Protection of Competition (ÚOHS) has been dealing with the behavior of ČD on a busy line for more than two years. The company suspects that it has prices that destroy the competition, so-called predatory prices. The Office already has several opinions on the table from individual participants in the dispute, ie from Czech Railways, RegioJet and Leo Express. But their conclusions are contradictory.
Leo Express has been running on Czech dormitories since November 2012 |
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– The company was founded on November 18, 2009, and has had its current name since August 2011. At the birth of the rail carrier, the current director and majority shareholder Leoš Novotný Jr., son of the former owner and director of the Hamé food company. |
– Leo Express obtained a railway carrier license in 2010. The company operates five electrical units manufactured by the Swiss company Stadler. Each set consists of five cars with 237 seats, offers three classes. The first trains went into trial operation on November 13, 2012. |
– She tells daily 16 train connections, on the lines Prague-Ostrava-Karviná and Prague-Old Town near Uherské Hradiště. According to his own data, Leo Express had in one year 30 percent market share on the Prague-Ostrava route. |
– In April this year, Leo Express announced that in cooperation with the Railway Companies of Slovakia he wants to travel to Košice from December. Last summer, the company announced that it planned to enter the long-distance rail market in Poland. |
– In 2013, he transferred more than 800 thousand passengers. At the end of March this year, Leo Express announced that it had been transported its millionth passenger. |
– In 2013, the company reported you will get 193 million crowns (10.6 million crowns a year earlier) loss of 159.1 million crowns (a year earlier 78.1 million crowns). |
– At the end of last year, Leoš Novotný Jr. approximately 97 percent of Leo Express shares, the rest was held by Peter Köhler and Jakub Havrlant. |
– Leo Express today sued for the Czech sub-cost prices on the route Prague-Ostrava. According to Leo Express, ČD is thus trying to push competition out of the market. The company is demanding compensation for lost profits in the amount of 418 million crowns. However, Czech Railways claims that they did not commit any illegal actions. The second Czech private railway carrier, RegioJet, is also in dispute over the price of tickets with Czech Railways. |
Leoš Novotný: We have money ready for the expansion of Leo Express