Vol1 Demand & Revenue Forecast Final Report

Brazil TAV: Vol 1 – Demand and Revenue Forecast – Final Report TAV-SI-DEM-REP-10022-02

BRAZIL TAV PROJECT

Halcrow – Sinergia Consortium

June 2009

VOLUME 1
DEMAND AND REVENUE FORECAST

Final Report


Brazil TAV
Halcrow – Sinergia Consortium

VOLUME 1
Demand and Revenue Forecasts
Final Report

Contents Amendment Record
This report has been issued and amended as follows:

Reviewed Approved
Issue Rev Description Date
by by

01 01 WAAP MJ Final Version 25/06/09


Content
1 Executive Summary 1
1.1 Introduction 1
1.2 The TAV Project 2
1.3 The Existing Market 3
1.4 Approach to Ridership Forecasts 4
1.5 Ridership Forecasts 6
1.6 International Benchmarking 8

2 Study Background 10
2.1 Introduction 10
2.2 The TAV Project 10
2.3 TAV Area of Interest and Socio-economic Background 12

3 Existing Transport System 21
3.1 Introduction 21
3.2 Overview of Transport Systems by Mode 21
3.3 Travel Time and Performance 28
3.4 Access and Egress 29
3.5 Fares and Travel Costs 35
3.6 Demand Levels 39
3.7 Future Plans 46
3.8 Summary and Impacts on TAV 49

4 General Approach to Surveys and Model Development 51
4.1 Introduction 51
4.2 Overall Demand Forecasting Approach 51
4.3 Model Design and Development 53
4.4 Study Process 55

5 Surveys 57
5.1 Introduction 57
5.2 Focus Groups 57
5.3 Revealed and Stated Preference Surveys 61
5.4 Survey Results 65
5.5 Summary 74

6 Model Development 75
6.1 Introduction 75
6.2 Overall Model Structure 75
6.3 Zoning System 76
6.4 Transport Network 79
6.5 Observed Trip Matrix Development 81
6.6 Integrated Demand Model 82
6.7 Trip Generation 83
6.8 Trip Distribution 87
6.9 Mode Split Sub-model 89
6.10 Discussion of Parameter Values 94

7 Assumptions and Base Case Analysis 97
7.1 Introduction 97
7.2 Travel Time Assumptions 97
7.3 Fare Assumptions 98
7.4 Revenue Optimisation 101
7.5 Base Case Network Assumptions Summary 106


7.6 Competitive response/dynamics 107
7.7 Socioeconomic Assumptions 109
7.8 Impact of TAV on Socio-Economic Assumptions 113
7.9 Base Year Results (2008) 113
7.10 Estimation of Peak Hour Demand 117

8 Ridership Forecasts 120
8.1 Introduction 120
8.2 TAV Express 120
8.3 Regional Services 123
8.4 Optional Station Analysis 127
8.5 Airport Services 127
8.6 Summary 131
8.7 International Benchmarking 132
8.8 Sensitivity Tests 133
8.9 Ramp-up 134


Index of Tables
Table 1-1: Summary of TAV and Air assumptions - Rio de Janeiro to São Paulo 5
Table 1-2: Passenger demand, Rio de Janeiro - São Paulo 2014 6
Table 1-3: Passenger Demand, Rio de Janeiro - Campinas 2014 7
Table 1-4: Passenger Journeys and Revenue 2014 – 2044 8
Table 2-1: Population of the regions in the direct area of influence of TAV 15
Table 3-1: In-vehicle travel time by air, car, and bus, in minutes 28
Table 3-3: Access times in São Paulo 32
Table 3-4: Fares by day of week and flight time, Rio de Janeiro to São Paulo 36
Table 3-5: Fares by day of week and flight time, São Paulo to Rio de Janeiro 36
Table 3-6: Representative taxi fares to airports in Rio de Janeiro and São Paulo 37
Table 3-7: Tolls and fuel costs in the area of influence 38
Table 3-8: Fares of the main routes São Paulo–Campinas–Rio de Janeiro 38
Table 3-9: Air Passenger Volumes between Rio de Janeiro and São Paulo, 2007 39
Table 3-10: Frequency of weekday flights in each direction Rio de Janeiro – São Paulo 40
Table 3-11: Summary of competing modes with possible impact on TAV 49
Table 5-1: Location and dates of Focus Groups 58
Table 5-2: Focus Group Findings 60
Table 5-3: Charter bus counts 65
Table 5-4: Number of full RP surveys by mode, with the average number of daily trips 66
Table 5-5: Complimentary modes for airport trips, by trip purpose 67
Table 5-6: Main Trip motivation by mode 67
Table 5-7: Income Range of interviewees 68
Table 5-8: Trip frequency by mode 69
Table 5-9: Comparison of trip purpose by Express and Regional 72
Table 5-10: Characteristics of regional trips to São Paulo and Rio de Janeiro 72
Table 5-11: Origin/destination of visitors to the Shrine of Aparecida. 73
Table 6-1: Trip Generation Sub-models 84
Table 6-2: GDP/Capita and Air Passenger Growth 85
Table 6-3: 2008 Express Trip generation Sub-model Observed v Modelled 86
Table 6-4: 2008 Regional Trip generation Sub-model Observed v Modelled 86
Table 6-5: 2008 Trip Generation Summary 86
Table 6-6: Trip Destination Choice Sub-models 88
Table 6-7: Observed 2008 Annual Person Trips (thousands) 89
Table 6-8: Expanded Trips by Mode and Purpose in 2008 (‗000 passengers/year) 90
Table 6-9: Express Sub-model 92
Table 6-10: Express Mode Choice Sub-models 93


Table 6-11: Regional Mode Choice Sub-models 94
Table 6-12: Values of Time by Income Group and Purpose (R$/hr) 95
Table 6-13: Other Parameter Values in IVT Minutes – Express Model 95
Table 6-14: Other Parameter Values in Minutes – Regional Model 96
Table 7-1: City Pairs connected by HSR services 100
Table 7-2: HSR Single Fares 100
Table 7-3: Executive/Economic fares peak and off peak 100
Table 7-4: Stated Preference attribute levels 101
Table 7-5: Summary of key assumptions for Express model Rio de Janeiro – São Paulo 102
Table 7-6: Fares on a per km basis 103
Table 7-7: TAV Demand x Fare x Revenue for Regional connections 2008 104
Table 7-8: Modelled demand at R$0.30 per km 105
Table 7-9: Travel Time (minutes) 106
Table 7-11: Delays (minutes) 107
Table 7-12 : Annual Population Growth Rates for the Model Areas 109
Table 7-13 : Average Annual real growth rates for Income, for the modelled area by zone 111
Table 7-14: Car ownership (vehicles per ‗000 population) 111
Table 7-15: Annual percent change in total car ownership 112
Table 7-17: Acceleration factors applied each year to employment growth rates due to TAV 113
Table 7-18: TAV Express – Annual Figures 2008 114
Table 7-19: TAV Regional Services – Annual Figures 2008 116
Table 8-1: Demand and Revenue, Rio de Janeiro – São Paulo, 2014 121
Table 8-2: Demand and Revenue, Rio de Janeiro – Campinas (2014) 122
Table 8-3: Demand and Revenue Forecasts 2014 – 2044 Express Services 123
Table 8-4: Demand and Revenue Forecasts 2014 Regional Services 124
Table 8-5: Demand and Revenue Forecasts for Regional Services, 2014 - 2044 125
Table 8-6: 2014 Demand and Revenue aggregated by station 126
Table 8-7: Demand and Revenue Forecasts for Optional Stations 127
Table 8-8: 2008 Airport service demand and revenue 128
Table 8-9: 2014, 2024, 2034 and 2044 Airport service demand and revenue 129
Table 8-10: Passenger Journeys and Revenue 2014 – 2044 131


Index of Figures

Figure 1.1: TAV Study 1
Figure 1.2: TAV Schematic 2
Figure 2.1: Indicative TAV route and stations 10
Figure 2.3: South America, Brazil, and the states of Rio de Janeiro and São Paulo 13
Figure 2.4: States of Rio de Janeiro and São Paulo and the Area of Influence. 13
Figure 2.5: Direct Area of Influence for TAV - Metropolitan Areas and Regions 14
Figure 2.6: Real GDP percentage change year on year, 1994-2008 16
Figure 2.7: GDP per capita 2005 (in R$ 2000 equivalent) 17
Figure 2.8: Car Ownership rates in the Area of Influence 18
Figure 2.9: GDP by administrative area – 2005 19
Figure 2.10: Car ownership per person – 2007 19
Figure 3.1: Location of Santos Dumont and Galeão Airports in Rio de Janeiro 22
Figure 3.2: Location of Congonhas and Guarulhos Airports in São Paulo 23
Figure 3.3: Radial Road systems of São Paulo and Campinas 24
Figure 3.4: Radial road network of Rio de Janeiro 25
Figure 3.5: CPTM service between Jundiaí to São Paulo Luz station 28
Figure 3.6: Location of Santos Dumont Airport and Novo Rio Bus Terminal in relation to the Central
Business District and proposed TAV station in Rio de Janeiro 30
Figure 3.7: Location of Congonhas and Guarulhos Airports, bus terminal, and main business
centres in São Paulo 31
Figure 3.8: Rio de Janeiro Urban Rail Network, with indicative TAV Route 33
Figure 3.10: Volume of Annual Passengers between Rio de Janeiro and São Paulo 40
Figure 3.11: AADT of all vehicles in both directions at toll plazas. 42
Figure 3.12: Volume of traffic in São Paulo State - 2000 (all vehicles) 43
Figure 3.13: Overview of historical travel in the study corridor 44
Figure 3.14: Passengers by Bus by Year 45
Figure 3.15: Summary of historic number of trips growth by air, car, and bus 45
Figure 3.16 Proposed trains to the city of Guarulhos and Guarulhos Airport Express 46
Figure 3.17: Layout of the VLT at Congonhas Airport 47
Figure 3.18: Arc Road 48
Figure 3.19: Rodoanel ―Ring Road‖ 49
Figure 5.1: Example of screen with model scenario 62
Figure 5.2: Survey Locations at highways 63
Figure 5.3: Mode split of main mode of users interviewed 66
Figure 5.4: Mode split per monthly income range 68
Figure 5.5: Trip ends from expanded surveys in Rio de Janeiro zoning system, by air, car, and bus
70


Figure 5.6: Trip ends from expanded surveys in São Paulo zoning system, by air, car, and bus71
Figure 5.7: Visitors to the Shrine of Aparecida, 2003-2008. 73
Figure 5.8: Distribution of visitors by month and weekday/weekend in 2007 74
Figure 6.1: Model Structure 76
Figure 6.2: Model Zoning System 78
Figure 6.3: Model Zoning System in Rio de Janeiro and São Paulo 79
Figure 6.4: Travel Time Surveys in the Rio de Janeiro Urban Area 80
Figure 6.5: Choices made in the 3 model stages 82
Figure 6.6: Express Sub-model - Work Choice Structure 90
Figure 6.7: Express Sub-model - Non-work Choice Structure 90
Figure 6.8: Regional Sub-model Choice Structure 91
Figure 7-1: Yearly demand and revenue for regional connections (2008) 105
Figure 8.1: International Benchmarks 133
Figure 8.2: Passengers by Fare and Journey Time – Sensitivity Test 2008 134
Figure 8.4: Ramp-up graph for Rio de Janeiro São Paulo (2014-2024) 135


Glossary of Acronyms and Abbreviations

Portuguese English
AGETRANSP Agência Reguladora dos Serviços Regulatory agency of
Públicos Concedidos de Transportes Concessioned Public Transport
Aquaviários, Ferroviários, Services (Water, Rail, Metro, and
Metroviários e de Rodovias do Roads) of the state of Rio de
Estado do Rio de Janeiro Janeiro
ANAC Agência Nacional de Aviação Civil National Agency of Civil Aviation
ANTT Agência Nacional de Transportes National Agency of Land (Ground)
Terrestres Transportation
ARTESP Agência Reguladora de Transporte Regulatory Transport Agency of the
do Estado de São Paulo state of São Paulo
BCR Benefit-Cost Ratio
BID Banco Interamericano de
Desenvolvimento
BNDES Banco Nacional de Desenvolvimento
Economico e Social
CAPEX Capital Expenditure
CBD Central Business District
CNT Confederação Nacional do
National Confederation of Transport
Transporte
CPTM Companhia Paulista de Trens São Paulo Metropolitan Train
Metropolitanos Company
DENATRAN Departamento Nacional de Trânsito National Department of Transport
DER-SP Departamento de Estradas de Department of Roads of the state of
Rodagem do Estado de São Paulo São Paulo
DETRO/RJ Departamento de Transportes
Department of Road Transport in
Rodoviários do Estado do Rio de
the State of Rio de Janeiro
Janeiro
DfT UK Department for Transport
DNIT Departamento Nacional de Infra- National Department of Transport
Estrutura de Transportes Infrastructure
EMBRATUR Instituto Brasileiro de Turismo Brazilian Institute of Tourism
FEA Financial and Economic Appraisal
GDP Gross Domestic Product
HST/HSR High Speed Train/High Speed Rail
IBGE Instituto Brasileiro de Geografia e Brazilian Institute of Geography and
Estatística Statistics
IBOPE Instituto Brasileiro de Opinião Brazilian Institute of Public Opinion
Pública e Estatística and Statistics
INFRAERO Empresa Brasileira de Infra-estrutura Airport Infrastructure Company of
Aeroportuária Brazil
IRR Internal Rate of Return
MCA Multi Criteria Analysis


NATA New Approach to Transport
Appraisal (UK Government)
NPV Net Present Value
OPEX Operating Expenditure
PDDT-Vivo Plano Diretor de Desenvolvimento Transport Development Master
2000/2020 dos Transportes 2000/2020 Plan Study

PDTU-RMRJ Plano Diretor de Transportes Urban Transport Master Plan of the
Urbanos da Região Metropolitana do Metropolitan Region of Rio de
Rio de Janeiro Janeiro
PITU Integrated Urban Transport Plan for
O Plano Integrado de Transportes
the Metropolitan Region of São
Urbanos para 2020
Paulo
PPP Public-Private Partnership
PV Present Value
SEADE Fundação Sistema Estadual de State Agency of Data Analysis of
Análise de Dados de São Paulo São Paulo
TAV Trem de Alta Velocidade High Speed Train
TOR Terms of Reference
VfM Value for Money
VOC Vehicle Operating Costs
VOT Value of Time
WEBTAG The Web-based version of the UK
DfT‘s Transport Appraisal Guidance

IMPORTANT NOTICE
THE CONSORTIUM DOES NOT ADVOCATE OR ENDORSE ANY SPECIFIC
TYPE OF HIGH SPEED TRAIN OR TECHNOLOGY; WHEREVER POSSIBLE
GENERIC HIGH SPEED RAILWAY SPECIFICATIONS AND STANDARDS
HAVE BEEN USED TO DEVELOP ALL ASPECTS OF THIS STUDY INCLUDED
IN THIS VOLUME. WHERE REFERENCE IS MADE TO A TYPE OF HIGH
SPEED TRAIN OR TECHNOLOGY THIS DOES NOT IMPLY A PREFERENCE
OR RECOMMENDATION ON THE PART OF THE CONSORTIUM. ALL
JOURNEY TIMES ARE APPROXIMATE AND ARE BASED ON SIMULATIONS
UNDERTAKEN BY THE CONSORTIUM. THEY ARE SUBJECT TO CHANGE
DEPENDING ON THE FINAL ALIGNMENT ADOPTED.


1 Executive Summary

1.1 Introduction

1.1.1 In 2008, the Inter-American Development Bank (IDB) commissioned Halcrow Group Ltd
and Sinergia Estudos e Projetos LTDA (together the ―Consortium‖) to prepare a feasibility
study for a high speed railway line, with a maximum line speed of 350km/h, over 511
kilometres connecting the cities of Rio de Janeiro, São Paulo and Campinas in Brazil.
1.1.2 The Consortium has undertaken detailed studies summarised in the following volumes, as
follows:
Executive Summary;
Volume 1: Demand and Revenue Forecasts;
Volume 2: Alignment Studies;
Volume 3: Finance and Economics Appraisal and Concessioning;
Volume 4: Part 1- Rail Operations and Volume 4: Part 2 - Technology;
Volume 5: TAV Capital Cost; and
Volume 6: Real Estate

1.1.3 Figure 1.1 highlights the relationship between the workstreams.

High Speed Rail
Quantm Alignment Software Engineering
SP and RP Surveys Unit Cost Assumptions Parameters

TAV Alignment TAV Capex
Demand and Revenue Optimisation
Volume 1 Volume 5
Volume 2

Timetabling TAV Journey Time Figure 1.1:
Operating Planning Simulation
TAV Study

Operating and Timetabling Financial Model
Volume 4 Economic Appraisal

Finance and Economics
Real Estate – Volume 6 TAV Concession and
Concessioning Volume 3

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1.2 The TAV Project

1.2.1 TAV will run between Campinas, São Paulo and Rio de Janeiro (see Figure 1.1 and figure
1.2) and the TAV alignment developed fulfils an aspiration to connect the airports of
Viracopos, Guarulhos and Galeão to their metropolitan areas. The total estimated
distance between Campinas and Rio de Janeiro is 511 km; with the distance between
São Paulo and Rio de Janeiro approximately 412 km. Based on the alignment developed
(see Volume 2) the non-stop journey time between the two cities is estimated at
1
approximately 1 hour 33 minutes . Journey times will vary depending on the number of
stations stops, with a high speed long distance service between Rio de Janeiro to
Campinas taking up to 2 hours 27 minutes. All journey times are approximate.

Figure 1.2: TAV Schematic

1.2.2 TAV will have a mix of new and refurbished stations. In Rio de Janeiro there are plans to
refurbish and rebuild the abandoned station at Barão de Mauá (km 0) which is close to
the main bus station at Novo Rio. Provision has also been allowed for a light maintenance
facility and stabling sidings at Barão de Mauá. The next station is a new underground
station to serve Rio de Janeiro‘s international airport at Galeão (km 15). From Galeão the
line climbs through the mountainous region of Serra das Araras which is the major
engineering challenge requiring numerous sections of tunnels and viaducts. A further
station is planned at Volta Redonda/Barra Mansa (km 118) which is within the state of Rio
de Janeiro. Volta Redonda is an important industrial area with Latin America‘s largest
steel mill. There is provision for an optional station in the future at Resende to the west of
Volta Redonda/Barra Mansa.

1
Journey times are approximate and based on a maximum operational speed of 300km/h

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1.2.3 Traveling westwards TAV then crosses the state border between São Paulo and Rio de
Janeiro states. Provision has been made for a possible spur from the main alignment to
serve an optional station at Aparecida. Aparecida is an important pilgrim site which
generates 9.5 million visitors (2008). After Aparecida TAV then reaches the large
industrial city of São José dos Campos (km 327). São José dos Campos is an important
centre for high technology centered on aerospace and engineering with a population of
1.4 million. São José dos Campos is the proposed location of the rolling stock
maintenance depot; the city has access to the main highway network, has a well
developed regional airport, houses the Embraer assembling factory and has available
land to accommodate high impact land use.
1.2.4 Westwards from São José dos Campos the next station is at São Paulo‘s international
airport at Guarulhos (km 390). Guarulhos Airport station will be underground close the
main terminal buildings.
1.2.5 Upon reaching São Paulo a preferred station site has been identified at Campo de Marte
(Km 412) which is currently a federal airfield located in the north of São Paulo. In the
Consortium‘s opinion the selection of Campo de Marte provides an opportunity to build a
major land mark station. Campo de Marte station will have a number of through platforms
to allow trains to run from São José dos Campos to São Paulo and then north westwards
towards Campinas. Campo de Marte also includes a light maintenance facility and
stabling sidings.
1.2.6 From São Paulo, the TAV alignment then turns north westwards towards the city of
Campinas. North of São Paulo, there is provisional for a new parkway style optional
station at Jundiaí located between Anhanguera and Bandeirantes highways. The TAV
alignment then proceeds northwards with a further station at Viracopos airport (Km
488.5). Thus the TAV alignment fulfils an aspiration to connect the airports of Viracopos,
Guarulhos and Galeão with the major urban centres. The final station is at Campinas (km
511) the third largest city in the state of São Paulo after São Paulo and Guarulhos. This
will be a refurbished station including stabling sidings.

1.3 The Existing Market

1.3.1 Existing transport modes air, car and bus are well established in the market between the
three cities, in particular the high frequency air shuttle connecting the cities of Rio de
Janeiro and São Paulo. In 2008, the total estimated demand between Rio de Janeiro and
São Paulo was 7.3 million trips with a market share for air of 60%, 17% for car and 23%
for bus. The air shuttle, which has a 15 minute frequency, a 55 minute gate-to-gate travel
time and currently 71 daily flights in each direction, dominates the market for time
sensitive business passengers, and as a result, is one of the most profitable routes for the
three airlines (TAM, GOL and Oceanair).
1.3.2 Both domestic airports Santos Dumont (Rio de Janeiro) and Congonhas (São Paulo) are
exceptionally well located for the markets they serve as they are adjacent to the central
business districts of Rio de Janeiro and São Paulo, and can easily be accessed by a short
taxi ride. The international airports (Guarulhos in São Paulo and Galeão in Rio de
Janeiro) by contrast are located 27km and 20km respectively from the CBDs taking
between 30 and 60 minutes to access by taxi. The accessibility of the domestic airports is
in contrast to high speed rail projects in other countries where competing airports are
typically located on the periphery while stations are in the centre.

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1.3.3 However, the domestic airports of Santos Dumont and Congonhas suffer from congestion,
and a fatal crash at Congonhas in 2007 in poor weather highlighted the problems of
operating a high intensity service. (Full details of the operational constraints are discussed
in Volume 3). Congonhas is currently operating in excess of capacity under instrument
conditions, and to maximise available capacity Santos Dumont is almost entirely
dedicated to services to São Paulo. Due to their respective locations, expansion of either
airport would be difficult and expensive. The development of Congonhas is closely related
to the overall plan for development of São Paulo‘s airports. Nonetheless, the air shuttle is
an extremely efficient operation offering frequent services located close to the CBDs of
the two cities.
1.3.4 Bus and car trips between Rio de Janeiro and São Paulo take 5-6 hours and suffer from
congestion within the urban areas. Rio de Janeiro, São Paulo, and Campinas are served
by a network of tolled highways but they have a poor safety record. Car ownership is
expected to increase in proportion to increases income. Bus services are well used by
European standards and offer three levels of service. There are no long distance
passenger trains operating between the two cities but there is a limited commuter railway
between São Paulo and Jundiaí.

1.4 Approach to Ridership Forecasts

1.4.1 Reliable ridership forecasts are critical to assessing the overall viability of the TAV project.
The main forecasting challenge is to estimate demand for a new transport mode that does
not currently exist in the market.
1.4.2 The recommended modelling approach to estimating high speed rail ridership is to use
revealed preference (RP) and stated preference (SP) survey techniques together with
Logit models. Logit models are commonly used in transport planning to estimate market
shares i.e. diversion rates from air to rail, car to rail, and bus to rail and so on, and are
therefore ideally suited to modelling the introduction of TAV. The methodology used in this
TAV study is consistent with that used for other high speed rail projects, notably in the UK
and Spain.
1.4.3 An updated version of RP/SP methodology was used complimented by a very extensive
survey programme to provide RP and SP datasets. RP surveys were used to form a
comprehensive picture of current travel demand and together with traffic count data were
used to develop origin and destination (OD) matrices. Focus groups were held in April
2008 to inform development of the proposed RP and SP survey programme and the
design of the SP surveys. Careful consideration was given to the design of the SP
surveys to minimise potential policy bias, as there are no long distance passenger train
services in Brazil, and other known methodological problems with SP design and
estimation. However, it can state that the overall results of the ridership forecast do not
indicate a significant bias favoring TAV in the base year. Logit models were estimated
within the ALOGIT software package with assistance from DICTUC a specialist modelling
consultancy based in Chile.
1.4.4 The initial survey programme was designed around the core market for longer distance
journeys between Rio de Janeiro – São Paulo and Rio de Janeiro – Campinas, where air
is a competing mode. In total 1,759 SP surveys and 5,684 RP surveys were carried out. A
large number of surveys were done to improve the statistical significance of the final
results. These results were used to build an express sub-model and to establish the size
of the current market.

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1.4.5 Subsequently, the survey program was extended to examine potential demand at
intermediate stations at São José dos Campos, Volta Redonda/Barra Mansa, Resende,
and Jundiaí. Additional surveys were undertaken to infill any gaps in the data set. The
additional surveys were used to develop a regional sub-model. The key difference
between the express and regional sub-models is that air mode is not available in the
regional model because there are no short distance flights. To reflect the importance of
trip purpose the models were also partitioned into peak and off-peak trips. In total
between the express and regional sub-models 7,733 RP surveys and 3,808 SP surveys
were undertaken.
1.4.6 The Logit models were extended to incorporate an advanced modelling technique which
integrates trip generation and trip distribution. Here the inclusion of trip generation and trip
distribution stages allows estimates to be made of new or ‗induced‘ trips made to take
advantage of the TAV mode, and the changes resulting in trip patterns because of the
transformation of accessibility.
1.4.7 The express and regional models comprise three separate stages: trip generation, trip
distribution and mode split. The air mode is available in express model only. Each of
these three stages has been calibrated for 2008 and show high levels of fit between
modelled and observed trips. More details are given in Chapter 6. The express and
regional sub-models are able to estimate market shares based on attributes such as
frequency, journey time, fare, access time and so on, which can be altered within the
model. In addition the model is sensitive to socio-demographic/economic inputs such as
population, GDP, employment and car ownership which are used to estimate growth in
trips over time.
1.4.8 Based on parameters derived from the regional sub-model a separate airport sub-model
was developed for a train serving Guarulhos, Galeão and Viracopos. However, it should
be noted that the airport train forecasts given in this report are preliminary in nature and
we recommend additional work be undertaken to examine the business case for an
airport service independently.
1.4.9 A series of optimisation tests were undertaken to determine revenue maximising fares for
the express and regional sub-models within the SP attribute ranges tested in the surveys.
Optimisation was done by firstly setting the airline fares in the express sub-model and
then changing the TAV fares to maximise revenue. TAV fares were developed for peak
and off peak trips and for economy and executive classes. Revenue was also maximised
for regional services in a similar way by progressively increasing TAV fares.
1.4.10 The optimum TAV fares for the Rio de Janeiro to São Paulo were determined by selecting
air fares of R$400 for peak and R$180 for off-peak trips based on an analysis of available
air fares. These air fares are close to those marketed by GOL, a low cost operator, and
are lower than those offered by TAM. A summary of the key assumptions for the Rio de
Janeiro - São Paulo service are shown in Table 1.1.

Table 1-1: Summary of TAV and Air assumptions - Rio de Janeiro to São Paulo

TAV Air (Based on GOL)
Peak Off-Peak Peak Off-Peak
Executive R$325 R$250 n/a n/a
Economy R$200 R$150 R$400 R$180
Journey Time 1 hour 33 minutes* 55 minutes
Embark 5 minutes 50 minutes
Disembark 4 minutes 5 minutes
Total Time 1 hour 42 minutes 1 hour 50 minutes
Frequency 3 trains per hour Flights every 15-30 minutes
Delay Time 5 minutes Up to 30 minutes

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1.5 Ridership Forecasts

Rio de Janeiro to São Paulo Market
1.5.1 Forecasts were generated for 2014 (assumed opening year of TAV), 2024, 2034 and
2044. Table 1.2 gives the forecasts for 2014. Other key results are:
the total estimated market without TAV is 10.7 million trips of which air is forecast
to have 68.34%;
TAV increases the total market to 12.1 million trips of which TAV has an
estimated ridership of 6.4 million passengers and market share of 52.89% of the
total market. TAV‘s market share of the air and rail market is 75% in the off-peak
and 55% in the peak;
TAV generates revenues of R$1.31 billion in 2008 prices, split R$811.8 million
peak and R$502.2 million off-peak; and
induced traffic is estimated at 6.1% in the peak and 30.2% in the off-peak, giving
13.4% in total.
After 2034 a growth rate of 3.7% p.a based on GDP forecast was used in all
forecasts.

Table 1-2: Passenger demand, Rio de Janeiro - São Paulo 2014

Without TAV With TAV
Passenger Passenger
Mode Split (%) Mode Split (%)
Demand („000) Demand („000)

TAV -- -- 6,435 52.89%

TAV Executive -- -- 4,938 (40.59%)

TAV Economy -- -- 1,497 (12.31%)

Air 7,333 68.34% 3,907 32.11%

Car 1,757 16.38% 960 7.89%

Bus 1,640 15.28% 865 7.11%

Total 10,730 12,167

1.5.2 In 2024 TAV ridership is forecast to increase to 10.2 million trips and 17.3 million trips in
2034 and 24.9 million in 2044.

Rio de Janeiro to Campinas Market
1.5.3 Forecasts were generated for Rio de Janeiro to Campinas and key results are shown in
Table 1.3. For 2014 the results are as follows:
the forecast total market without TAV is 711,000 trips;
TAV increases the market to 914,000 trips, of which TAV captures 635,000 or
69.5% of the total market. TAV share of the air and rail market is 80%;
TAV generates revenues of R$146 million; and
induced traffic of 28%.
After 2034 a growth rate of 3.7% p.a based on GDP forecast was used in all
forecasts.

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Table 1-3: Passenger Demand, Rio de Janeiro - Campinas 2014

Without TAV With TAV
Passenger Passenger
Demand („000) Mode Split (%) Demand („000) Mode Split (%)

TAV -- -- 635 69.50%

TAV Executive -- -- 508 (55.6%)

TAV Economy -- -- 127 (13.9%)

Air 361 50.80% 160 17.50%

Car 98 13.80% 43 4.70%

Bus 252 35.40% 76 8.30%

Total 711 914

1.5.4 In 2024 TAV ridership for Rio de Janeiro to Campinas is forecast to increase to 1.1 million
trips.

Regional/Commuter Services
1.5.5 Forecasts were also produced for regional services between Rio de Janeiro and
Campinas with stops in Galeão, Volta Redonda/Barra Mansa, São José dos Campos,
Guarulhos, São Paulo and Viracopos.
1.5.6 They key results in 2014 are as follows:
The largest flow by volume is between São Paulo and Campinas at 12.4 million
passengers. This is in fact the largest flow on TAV in terms of passenger volume.
São Paulo to Campinas generates R$386 million;
The second largest flow is between São José dos Campos and São Paulo at 8.6
million passengers generating R$246.3 million;
The third largest flow is between Rio de Janeiro and Volta Redonda/Barra Mansa
at almost 2.6 million passengers generating R$105 million p.a.; and
All other flows (e.g. Rio de Janeiro to São José dos Campos) generate low levels
of demand.
1.5.7 Demand on the regional services is expected to grow by 3.1% p.a. from 2014 to 2024 and
3.6% p.a. from 2024-34. Growth rates are highest between São Paulo - Campinas and
São Paulo – São José dos Campos, suggesting continued strong demand for these
commuter services. Induced demand is 16.0% overall on the regional services, while on
the largest flows, it is 17.7% between São Paulo – Campinas and 17.1% for São Paulo –
São José dos Campos. Beyond 2034 a 3.7% p.a. growth rate based on forecast GDP
growth was used.

Model Results Summary
1.5.8 Table 1.4 provides the total revenue and journeys for the base case. Total TAV revenue
in 2014 is R$2,421 million increasing to R$5,921 million by 2034. For the purpose of the
finance and economics report it has been assumed that TAV opens mid-year in 2014 to
allow for ramp-up of demand.

Page 7 of 135


Table 1-4: Passenger Journeys and Revenue 2014 – 2044

Demand Journeys (passengers / year,
2014 2024 2034 2044
Component „000)
Rio de Janeiro – São Paulo
Express sub-model 7,070 11,282 19,323 27,788
Rio de Janeiro – Campinas

Regional sub- Rio de Janeiro – Galeão – Volta
model Redonda/Barra Mansa – São José
27,944 38,734 55,353 79,602
(including airport dos Campos – Guarulhos – São
services) Paulo – Viracopos – Campinas

Total Journeys 35,014 50,016 74,676 107,390

Demand Revenue (R$/year, in „000) 2014 2024 2034 2044
Component
Rio de Janeiro – São Paulo
Express sub-model 1,460,025 2,328,500 4,012,100 5,769,780
Rio de Janeiro – Campinas

Regional sub- Rio de Janeiro – Galeão – Volta
model Redonda/Barra Mansa – São José
961,387 1,337,780 1,909,096 2,745,461
(including airport dos Campos – Guarulhos – São
services) Paulo – Viracopos – Campinas

Total Revenue 2,421,412 3,666,280 5,921,196 8,515,241

Station Analysis
1.5.9 The largest station by demand volume in 2014 is São Paulo Campo de Marte at 27.5
million passengers, or approximately 75,450 per day. The second largest is Campinas at
15.2 million or approximately 41,400 per day. Passenger volume is important when
considering station capacity and design, and interchanges with other public transport
systems.

Optional Stations
1.5.10 Forecasts were developed for optional stations at Jundiaí, Resende, and Aparecida. They
have been examined on the basis of revenue alone. A detailed analysis of the economic
case for each station has not been undertaken other than the details given in the
alignment volume. In 2014 the forecasts are as follows:
Jundiaí generates demand of approximately 10 million passengers and R$157
million in revenue. Thus, detailed analysis for this station is presented in this
report even though it still an optional station;
Resende has the lowest demand volume of all the stations analysed, with 1
million passengers and R$51 million in revenue; and
Aparecida station is only expected to operate at weekends and has a potential
demand of 3.4 million passengers generating R$229 million in 2014.

1.6 International Benchmarking

Ridership forecasts for Rio de Janeiro to São Paulo and Rio de Janeiro to Campinas have been
benchmarked against international experience. There are a number of city pairs now served by high
speed rail and academic research (Steer Davis Gleave - 2006, Air and Rail Competition and
Complementarity) has focussed on comparing the market share between air and high speed rail.
Figure 1.3 shows the forecast market share for TAV in 2014 against rail journey for Rio de Janeiro
to São Paulo (peak and off-peak) and for Rio de Janeiro to Campinas benchmarked against other
city pairs.

Page 8 of 135


1.6.1 Based on the benchmarking the following conclusions can be drawn:
The close fit for Rio de Janeiro to Campinas suggests that the model is producing
sensible results benchmarked against international experience as it is on the
trend line;
Competition from the domestic airports is strong, and arguably unique to São
Paulo and Rio de Janeiro hence the market share of TAV is below the trend line.
All major European capitals have airports located some distance from the centre
which increases access time and reduces the competitiveness of air;
If the peak and off-peak are considered separately TAV has a market share of
55% in the peak and 75% in the off-peak, and hence in the off-peak is closer to
the trend line. This is a reflection of the fact that the scope for induced traffic in
the peak is limited compared to the off-peak;
For the Paris – Brussels route, which has the highest rail market share at over
90% with a similar rail journey time to TAV, there is a very limited air service. Air
France does not operate any flights between Paris and Brussels, and Brusselsair
operates just one daily flight. A similar reduction in flights between São Paulo and
Rio de Janeiro would increase TAV‘s market share close that of Paris – Brussels;
Brazil has a strong culture of bus usage, more so than in Europe, where rail
services dominate medium/long distance travel. Buses in Brazil are efficient and
offer generally good levels of comfort and very competitive prices. This reason
may also account for TAV market share being below the trend line; and
It should also be noted that other induced traffic effects take time to build-up, in
particular land-use changes and real estate development. These effects will
generate additional traffic which in reality will be captive to TAV and will therefore
increase its market share.

Rail- Air Marketshare International Benchmarks
100

Paris-Brussels
90
Paris-Lyon
Tokyo-Osaka
Rio-Campinas Madrid-Seville
80
Seoul-Busan
Paris-London
70 Rio-S.Paulo Off-Peak Roma-Bologna

Air Stockholm-Gotteborg
Competition
60
Rail share (%) of Rail/Air Market

50 Rio-S.Paulo Peak
Paris-Amsterdam

40
Rome-Milan

30
Madrid-Barcelona

20

10

0
50 100 150 200 250 300
Rail Travel Time (Minutes)

Figure 1.3: International Benchmarks
Note: Consortium figure using data from Steer Davis Gleave (2006), Air and Rail Competition and Complementarity.
Prepared for European Commission DG TREN.

Page 9 of 135


2 Study Background

2.1 Introduction

2.1.1 In 2008, the Inter-American Development Bank (IDB) commissioned Halcrow Group Ltd
and Sinergia Estudos e Projetos Ltda (the ―Consortium‖) to prepare a feasibility study for
a high speed rail line connecting Rio de Janeiro – São Paulo and Campinas, referred to
as TAV: Trem de Alta Velocidade in Portuguese.
2.1.2 This chapter aims to provide important background to the TAV study. Section 2.2 provides
an overview of the TAV project including details of past feasibility studies which have
been undertaken. Section 2.3 focuses on the areas of Brazil most influenced by TAV, and
examines the socio-economic aspects of the area, including population, GDP, and car
ownership. The existing transport situation in the TAV area of influence is discussed in
Chapter 3.

2.2 The TAV Project

2.2.1 The total length of the proposed high speed line between Campinas and Rio de Janeiro is
511km with an initial estimated journey time of approximately 2 hour 25 minutes (based
on the preferred alignment and including intermediate stops), while a non-stop service
from São Paulo to Rio de Janeiro would be approximately 1 hour 33 minutes, slightly
longer in the opposite direction as São Paulo is at a higher elevation. An indicative
schematic of the proposed TAV line is shown in Figure 2.1.

Figure 2.1: Indicative TAV route and stations

2.2.2 The design for TAV is based on generic high-speed rail technology with specific provision
for a dedicated, fully segregated alignment between the cities to maximise running speed
and ensure high operational performance in terms of reliability and punctuality. At this
stage it is not envisaged that TAV will share any existing track or joint running with
existing Brazilian rail or metro services but will have dedicated tracks to the final terminal
station in each city.

Page 10 of 135


2.2.3 TAV will have a very high capacity compared with other transport modes; for example,
Eurostar services between London and Paris can accommodate 750 passengers per train
compared with an Airbus A320-200 series with 148 seats, used on internal short haul
flights. However, the capital cost of high speed rail is very high (around €40m per km –
see Volume 4), but it creates very high capacity and is therefore most economical when
trains are running at capacity i.e. there is high demand. High speed rail therefore lends
itself to city pairs with high existing demand, as is the case between Rio de Janeiro and
São Paulo.
2.2.4 TAV is expected to have a mix of new and refurbished stations. There are plans to
refurbish and upgrade the abandoned stations at Barão de Mauá and Campinas.
Intermediate stops are being planned at Galeão, Volta Redonda/Barra Mansa, São José
dos Campos, Guarulhos, Campo de Marte in São Paulo, and Viracopos. Optional stations
are being considered at Jundiaí, Resende and Aparecida to serve visitors to the Shrine of
Aparecida.
2.2.5 Based on European experience TAV can expect to capture a significant share of the
current market between São Paulo and Rio de Janeiro; currently Eurostar has 70% plus
of the combined rail and air market between Paris and London, with a similar share for the
London to Brussels market. This demand study seeks to forecast the market share for
TAV. More detail on comparison to international comparison can be found in Chapter 8 –
Ridership Forecasts.

The TAV Feasibility Study
2.2.6 Three previous feasibility studies have been undertaken to examine the potential for a
high speed rail service: TRANSCORR in 1997-2000, Enontec in 2004, and DE-Consult in
October 2007. Of the three studies, the TRANSCORR study was the most detailed and
was chosen by the Consortium as a starting point, providing a reference for our work.
However this study was conducted between 1997 and 2000 and since then high speed
train technology has evolved, and the Brazilian economic situation has advanced to the
extent that TRANSCORR‘s conclusions and results needed to be exhaustively reviewed.
2.2.7 As per the Terms of Reference (TOR) the Consortium is currently completing detailed
studies in the following areas:
Volume 1: Demand and Revenue Forecasts (this report);
Volume 2: Alignment Studies;
Volume 3: Finance and Economics Appraisal and Concessioning;
Volume 4: Part 1- Rail Operations and Volume 4: Part 2 - Technology;
Volume 5: TAV Capital Cost; and
Volume 6: Real Estate
2.2.8 The relationship between the volumes is shown in figure 2.2. A separate workstream
examining environmental issues is being developed by Prime Engenharia outside the
Consortium.
2.2.9 It is important to stress the interrelated nature of the studies since the demand work is
critical to developing a railway timetable and also to the financial and economic appraisal
work. Similarly, the alignment work is critical to developing journey time estimates and
construction costs.

Page 11 of 135


High Speed Rail
Quantm Alignment Software Engineering
SP and RP Surveys Unit Cost Assumptions Parameters

TAV Alignment TAV Capex
Demand and Revenue Optimisation
Volume 1 Volume 5
Volume 2

Timetabling TAV Journey Time
Operating Planning Simulation

Operating and Timetabling Financial Model
Volume 4 Economic Appraisal

Finance and Economics
Real Estate – Volume 6 TAV Concession and
Concessioning Volume 3

Figure 2.2: TAV study

2.2.10 The remainder of this chapter discusses the socio-economic background of the study
area.

2.3 TAV Area of Interest and Socio-economic Background

Introduction
2.3.1 The TAV area of influence is located in the states of São Paulo and Rio de Janeiro, as
shown in Figure 2.3. Figure 2.4 focuses on the two states and shows the area of influence
straddled between them.

Page 12 of 135


Figure 2.3: South America, Brazil, and the states of Rio de Janeiro and São Paulo

2
Figure 2.4: States of Rio de Janeiro and São Paulo and the Area of Influence .

2
The costal area located just east of the SP/RJ State border is not included as an Area of Influence
for TAV because of the existence of the Serra do Mar. The connection of this area and São Paulo is
made using the BR-101, a highway that runs along the coast from Rio de Janeiro to Santos.

Page 13 of 135


2.3.2 As seen in Figure 2.5, TAV will provide an important connection between the Metropolitan
Regions of Campinas, São Paulo and Rio de Janeiro. In the area of direct influence of
TAV are also the regions of Jundiaí and Vale do Paraíba Paulista in São Paulo State, and
the Vale do Paraíba Fluminense in Rio de Janeiro State. Stations planned in these areas
include, São José dos Campos, and Volta Redonda/Barra Mansa, as well as stations at
Guarulhos, Galeão and Viracopos Airports in São Paulo, Rio de Janeiro and Campinas
respectively. In addition, optional stations are being considered at Jundiaí, Aparecida to
serve the Shrine of Aparecida, a major tourist and religious destination and Resende.

Figure 2.5: Direct Area of Influence for TAV - Metropolitan Areas and Regions

2.3.3 The region encompassing Rio de Janeiro - São Paulo - Campinas is the most important
economic region of the country. The states of Rio de Janeiro and São Paulo contain 30%
of the Brazilian population and 45.5% of its GDP (Source: IBGE-2007).
2.3.4 Within this area, the São Paulo - Campinas corridor is now being called "the first
megalopolis in the Southern Hemisphere". The combined population of the 65 cities in the
2
38,000 km area is 22 million. This area is the economic centre of Brazil. São Paulo,
which has traditionally been associated with manufacturing and trade, has developed its
financial and service sectors in recent years, greatly increasing the wealth of the area.
The GDP of the city of São Paulo represents over 12% of Brazilian GDP, while containing
less than 6% of the population.
2.3.5 It is important to clarify the locations in use in this report as they may lead to confusion.
The city of São Paulo is the capital of the state of São Paulo and is contained within the
Metropolitan Region of São Paulo. Similarly the city of Rio de Janeiro is the capital of
the state of Rio de Janeiro, and is contained within the Metropolitan Region of Rio de
Janeiro.
2.3.6 The definition of the Metropolitan Region of Rio de Janeiro follows the definition given by
the Master Plan for Urban Transport in the Metropolitan Region of Rio de Janeiro (PDTU)
and the Metropolitan Region of São Paulo defines which municipalities are included in the
Integrated Urban Transport Plan (2025 PITU).

Population
2.3.7 This section highlights some important socio-economic trends of the region, starting with
population. Appendix A contains a spreadsheet with the tabulation of the socioeconomic
data collected. Any blank spaces refer to data that is not available.
2.3.8 Table 2.1 provides a brief summary of the regions of the area of interest, including
population, main industries, and major cities. The total population of the area of influence
is over 36,422,964, mainly concentrated in the metropolitan regions of São Paulo and Rio
de Janeiro, which also have the highest population densities.

Page 14 of 135


Table 2-1: Population of the regions in the direct area of influence of TAV

Primary City
Metropolitan 2007 2 2
Area km Pop/ km Main industries (2007 est
Region Population
Population)

Finance, services,
São Paulo 19,226,426 7,943 2,421 10,886,000
manufacturing

High tech, auto,
Campinas 2,635,358 3,647 723 1,059,000
research, education

Services,
Jundiaí 580,119 431 1,346 347,000
manufacturing

Manufacturing, 611,000
Vale do Paraíba research,
2,156,534 16,179 133 (São José dos
Paulista aeronautics
Campos)

Tourism, finance,
Rio de Janeiro 11,157,122 5,645 1,977 services, 6,136,000
manufacturing

Vale do Paraíba Manufacturing, steel, 259,000
667,405 3,828 174 agriculture
Fluminense (Volta Redonda)
Source: IBGE
2.3.9 Table 2.2 highlights population trends for the area of influence. Three main trends are
evident. Firstly, while the period 1970-2007 has seen a significant population increase, by
comparison growth has tapered off in all regions from 2000-2007, with growth rates
approximately half of the 37 year period. Second, the regions near São Paulo have grown
at a higher rate compared with Rio de Janeiro – in São Paulo state growth rates range
from 1.16-1.75% from 2000-2007 vs. 0.96% near Rio de Janeiro. Thirdly, the Rio de
Janeiro and São Paulo metropolitan regions have lower growth than the other less
populated regions, indicating that the more outlying areas have a greater capacity for
growth.

Page 15 of 135


Table 2.2: Summary of population changes in the Area of Influence

Annual Growth
Population
1
Rate
Region
1970- 2000-
1970 1980 1991 2000 2007
2007 2007
São Paulo Metro
8,139,705 12,588,745 15,444,941 17,833,511 19,226,426 2.35% 1.08%
Region
Campinas Metro
680,826 1,276,801 1,866,025 2,333,335 2,635,358 3.73% 1.75%
Region
Jundiaí Region 201,651 335,029 437,978 529,302 580,119 2.90% 1.32%
Vale do Paraíba
834,652 1,221,221 1,651,594 1,989,692 2,156,534 2.60% 1.16%
Paulista
Rio de Janeiro
6,813,917 8,650,181 9,657,010 10,695,357 11,157,122 1.34% 0.61%
Metro Region
Vale do Paraíba
332,263 467,382 547,798 624,090 667,405 1.90% 0.96%
Fluminense

1 – The list of cities of each region is presented in the Appendix A – Socioeconomic data – Area of Influence
Source: IBGE
GDP Growth
2.3.10 GDP, as an aggregate measure of economic activity in the country, provides a good
indication on overall travel demand, and growth in GDP has a strong relationship with
travel demand growth. Passenger demand increases with economic activity due to
additional travel demand from business trips, while leisure travel increases as residents
are more able to afford leisure travel.
2.3.11 Figure 2.6 presents the growth in Brazilian GDP since 1994 when the economic stability
plan ―Plano Real‖ was implemented, during which time it averaged 3.07% pa.

6.00
5.71 5.67
5.33
5.00 5.08
GDP Real Percent Change

4.42 4.31
4.00 3.97

3.38
3.16
3.00
2.66
2.15
2.00

1.31
1.15
1.00

0.25
0.00 0.04
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Year

Percent Change

Figure 2.6: Real GDP percentage change year on year, 1994-2008
Source: IPEA-DATA

Page 16 of 135


2.3.12 Dividing GDP by population (GDP/capita) normalizes the GDP for different regions of
Brazil. One would expect travel demand rates to be highest to and from regions of higher
GDP/capita reflecting higher economic activity rates (e.g. increasing business travel) while
the implied greater affluence will enable more leisure travel.
2.3.13 Figure 2.7 provides a breakdown of GDP per capita by region in the area of influence,
with the regions listed from west to east.

20,000

18,000 17,297
GDP per capita in R$ 2000 (2005)

16,854

16,000
14,354 13,940
14,000

12,000 11,275
9,664
10,000

8,000

6,000

4,000

2,000

-
Campinas Jundiaí São Paulo Vale do Vale do Rio de Jan
Metro Region Metro Paraíba Paraíba Metro
Region Region Paulista Fluminense Region

Region

Figure 2.7: GDP per capita 2005 (in R$ 2000 equivalent)
Source: IPEA – DATA (GDP) & IBGE (Population)

2.3.14 GDP per capita is significantly higher in São Paulo than in the Rio de Janeiro metropolitan
region (R$13,940 vs. R$9,664), and Rio de Janeiro and São Paulo‘s GDP is lower than
their surrounding regions. The high GDP/capita in the São Paulo region reflects the
greater proportion of financial services here compared to Rio de Janeiro. Vale do Paraíba
Fluminense has the highest levels of GDP per capita, due to its smaller population,
diverse economy, and large industrial base, with Latin America‘s largest steel works
located in Volta Redonda.
2.3.15 Both states have average household incomes well above the national average, reflecting
the relative affluence of this area of the country. São Paulo in particular, has household
incomes more than 50% higher than the national average, and about 11% higher than Rio
de Janeiro. This reflects the high GDP/capita productivity figures that are observed in São
Paulo.

Car ownership
2.3.16 Car ownership in the study corridor is relatively high compared to the national average,
and has grown markedly in recent years. Figure 2.8 presents car ownership rates by
region for 2001 and 2008.

Page 17 of 135


350

300
Cars per 1000 population

250

200
2001
2008
150

100

50

0
Campinas Jundiaí São Paulo Vale do Vale do Rio de Jan BRAZIL
Metro Region Metro Paraíba Paraíba Metro
Region Region Paulista Fluminense Region

Region

Figure 2.8: Car Ownership rates in the Area of Influence
Source: DENATRAN. NB: Population figures to calculate the rates for 2001 have been interpolated.
2.3.17 The highest car ownership rates are found in the São Paulo, Campinas, and Jundiaí
regions, reflecting the relative affluence of this area with more than 0.3 cars per capita.
Car ownership rates in São Paulo were 72% higher than Rio de Janeiro in 2008, while
ownership rates of Campinas are almost double those of Rio de Janeiro.
2.3.18 The highest rates of growth have also been largely in the areas of highest existing car
ownership, particularly the surrounding areas of Vale do Paraíba Fluminense (4.8% p.a.)
and Jundiaí (4.7% p.a.). São Paulo and Rio de Janeiro have grown at more moderate
rates of 3.9% and 3.4% respectively.

Geographic Distribution of GDP and car ownership
2.3.19 The figures below show the distribution of GDP and cars registration in the area of
interest, which reinforce the graphs above.

Page 18 of 135


Source: IBGE

Figure 2.9: GDP by administrative area – 2005

2.3.20 With regard to GDP, the entire corridor of the proposed TAV route shows high levels of
GDP per capita; it is especially high in the corridor from Campinas to São Paulo, and in
the Vale do Paraíba Fluminense (just west of Rio de Janeiro) which has a large industrial
base, while the more rural areas near the coast, and the outer regions of the Rio de
Janeiro metropolitan region are lower.

Figure 2.10: Car ownership per person – 2007
Source: Denatran

Page 19 of 135


2.3.21 Car ownership per person follows a similar pattern to GDP, with higher levels in the
Campinas-São Paulo-São José dos Campos corridor, compared to Rio de Janeiro.

Summary
2.3.22 This section has presented the primary socioeconomic factors and trends which will
impact on demand for TAV:
São Paulo has become a centre for the service and financial industries, and is the
economic focus of Brazil, with a 12% of all GDP in Brazil;
the Campinas-São Paulo-Rio de Janeiro region is important to the national
economy and the TAV provides an opportunity to connect the cities to support
further economic growth;
population has grown substantially in the past 40 years, particularly in São Paulo
and Campinas, increasing the potential market for TAV;
GDP in Brazil has grown strongly in recent years and the GDP of the area of
influence represents a significant proportion of the Brazilian economy. GDP
growth is strongly linked to demand for travel, leading to both increased road
congestion and greater demand for TAV; and
car ownership is higher in the São Paulo-Campinas corridor than in Rio de
Janeiro. Registration rates are higher than the national average, and increasing
more quickly in São Paulo than Rio de Janeiro.

Page 20 of 135


3 Existing Transport System

3.1 Introduction

3.1.1 The high speed rail area of influence in the Rio de Janeiro - São Paulo - Campinas
corridor is served by an array of transport options, providing a range of services for a
diverse market. Demand forecasts for a new service entering such a market require a
detailed appreciation of the current options available to understand how TAV will
compete, while explaining how TAV will integrate into the wider network. This chapter
describes the existing transport situation in the study corridor in terms of both supply and
demand.
3.1.2 Section 3.2 presents an overview of the transport system by existing mode: air, bus, car,
and rail. The remainder of the chapter assesses the transport system in the following
areas:
Section 3.3 - Travel Time and Performance (i.e. delays and congestion);
Section 3.4 - Access and Egress issues to stations and airports;
Section 3.5 - Fares and Travel Costs;
Section 3.6 - Existing Demand Levels; and
Section 3.7 - Future Plans which may affect demand for travel on TAV.

3.2 Overview of Transport Systems by Mode

3.2.1 Presently there are 4 modes available for intercity trips in the area of influence:
air;
highway/private car;
bus; and
rail (São Paulo – Jundiai commuter rail only).

3.2.2 Air services operate only between São Paulo, Rio de Janeiro and Campinas and they
represent the most serious competitor to TAV time sensitive trips on this long distance
corridor. A developed network of toll roads is available which connect the major centres,
though most routes are radial and do not enter the city centres. For those wishing to use
bus, a comprehensive network of interstate and intercity bus services is available and will
compete with TAV between all proposed stations, while local services provide access
within cities. There are currently no intercity rail services between Rio de Janeiro and São
Paulo, although there is an existing service between Jundiaí and São Paulo; metro and
commuter rail services provide for trips within the major cities of Rio de Janeiro and São
Paulo.

Air Travel
3.2.3 Air travel represents the most important competitor to TAV for long distance services,
because it is most similar in terms of journey time and probable market to be served. This
section provides a brief overview of the airports and air services in the area of influence.

Page 21 of 135


Airports
3.2.4 São Paulo and Rio de Janeiro are unusual as in addition to the traditional edge of city
international airport, they are both served by domestic airports in the central area of the
city. The domestic airport for São Paulo, Congonhas, is located 11km south of city centre,
while in Rio de Janeiro, Santos Dumont Airport has a unique location on a landfill site on
Guanabara Bay 2km from the historic and business centre of Rio de Janeiro. Both airports
are only served by surface modes (bus, taxi, private car) although Congonhas has a
metro station 5km away, connected to the airport by bus. The locations can be seen in
Figure 3.1 and Figure 3.2 below. The locations of the domestic airports, in particular
Santos Dumont (to which it is possible to walk from the city centre in about 15 minutes),
contribute to making air travel a significant competitor to TAV. This is discussed in more
detail in Section 3.4 – Access and Egress.

Figure 3.1: Location of Santos Dumont and Galeão Airports in Rio de Janeiro

Page 22 of 135


Figure 3.2: Location of Congonhas and Guarulhos Airports in São Paulo
3.2.5 Most long-distance and international flights operate from Galeão Airport, 20km north of
the centre of Rio de Janeiro, and Guarulhos Airport, 27km northeast of the centre of São
Paulo. Some flights between Rio de Janeiro and São Paulo operate from these airports,
but most passengers connect with international flights. TAV could exploit this demand by
providing long distance services to the international airports. In particular, it may be
attractive for residents of Rio de Janeiro to travel directly to Guarulhos which offers direct
services to more domestic and international destinations, thereby avoiding a change of
planes in São Paulo or elsewhere. Fares are generally the same or lower for travel to Rio
de Janeiro, because it attracts more price-sensitive leisure travellers, even for flights
which require a change at São Paulo, so it is unlikely that passengers will use TAV to
save money on airfare.

Air service
3.2.6 Due to the level of demand for travel between Rio de Janeiro and São Paulo, the airports
have prioritised a ―shuttle‖ type service between Santos Dumont and Congonhas Airports.
Currently over 90% of flights from Santos Dumont airport serve Congonhas, with the rest
to smaller locations close to Rio de Janeiro, while Congonhas serves many other
locations. The service is currently operated by three airlines (TAM, GOL, and Oceanair),
which together provide over 70 flights per day, with 4-5 flights departing every hour. The
fares are unregulated and reflect supply and demand, with flights in the morning and late
afternoon attracting the highest fares, with advance booking required to obtain the lowest
fares. All operators allow internet check-in and the frequency of flights provides great
flexibility to the traveller. It is understood that the ―shuttle‖ service is among the most
profitable routes for the three airlines serving this route.

Page 23 of 135


3.2.7 Viracopos Airport outside of Campinas is also in the area of influence. Viracopos is
primarily used for cargo services, though in the area of interest seven flights per weekday
operate between Viracopos and Galeão in Rio de Janeiro. Information about possible
Brazilian Government intentions to shift some flights from Guarulhos to Viracopos, were
never made available to the Consortium so this issue could not be analyzed.
3.2.8 Chapter 5 contains information obtained from focus groups regarding users‘ perceptions
of the airports, including perceived distance from centre and ease of use.

Highway Network
3.2.9 The road system linking Rio de Janeiro, São Paulo and Campinas is governed by both
state and federal authorities, but they are operated by the private sector. The public
agencies are:
Federal: National Agency for Land Transport (ANTT)
State of São Paulo: ARTESP - Regulatory Agency for Transport of São Paulo
State of Rio de Janeiro: AGETRANSP - the Regulatory Agency for the
concession of Transport Public Services, including Water, Rail, Metro and Road
Transport of Rio de Janeiro.
3.2.10 In order to improve maintenance and condition of the road network, most long distance
highways in Brazil operate as concessions leased to private operators who are permitted
to charge tolls. The strategic intercity roads in the area of influence are all tolled.
3.2.11 The road infrastructure of the Rio de Janeiro, São Paulo and Campinas Metropolitan
Regions is generally radial. São Paulo and Campinas lack direct highway access to their
centres; Rio de Janeiro has more direct access to the centre, though these arteries are
heavily congested at peak times. Figure 3.3 and Figure 3.4 show the road networks for
São Paulo, Campinas, and Rio de Janeiro.

Figure 3.3: Radial Road systems of São Paulo and Campinas

Page 24 of 135

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