Will high-frequency-train project derail Via Rail's future revenue?

The high-frequency-rail project between Toronto and Quebec City raises big questions about the future of Via Rail.

- CHRISTOPHER REYNOLDS

Via Rail relies on the stretch of track that runs between Quebec City and Windsor, Ont., to sustain operations across the country.

On track to start operations in about a decade, the so-called HFR promises to transport more passengers more quickly, more often. But the swifter service also threatens to redirect cash away from Via Rail’s broader service, which derives the vast majority of its revenue from the central Canadian corridor.

On top of government funding, Via relies on the stretch of track that runs between Quebec City and Windsor, Ont., to sustain operations across the country. Last year, 96 per cent of its riders and more than four-fifths of its revenue stemmed from the corridor.

The flow of that income is now in limbo, with both services — the current one and the HFR — set to run under a public-private partnership, or P3.

Via Rail — a Crown corporation rather than a P3 — derived 64 per cent of its gross income from government funding, with most of the rest coming from passenger revenues. The idea behind a P3 is that the efficiency and dynamism injected by private sector players would result in a business that is smoother, more self-sustaining and less dependent on federal coffers.