* Ferrari chairman breaks Italy state monopoly on high-speed
* Montezemolo-led consortium aims for 25 pct market share in
* NTV has invested 1 billion euros; sees breakeven in 2014
* Eight routes from Rome are first outings for Alstom's new
By Philip Pullella
NAPLES, April 23 As Europe's first privately
owned high-speed train hit 300 kph just outside Naples, Ferrari
chairman Luca Cordero di Montezemolo smiled at the suggestion
that he was addicted to risk and velocity.
"Yes," he said. "Yes, speed and risk, risk in terms of
economic risk. I think an entrepreneur has to risk, if not, he
is not an entrepreneur anymore."
Montezemolo and a consortium of private investors are taking
a 1 billion euro ($1.3 billion) risk that they can provide
better high-speed train service between major Italian cities
than state-run Trenitalia, taking advantage of a 2006 European
Union move to open up track to competition.
"We have brought an end to one of the longest monopolies in
the history of our country. Finally, Italian travelers and
tourists can choose," he said.
The new company, called NTV, or Nuovo Trasporto Viaggiatori,
starts service between Rome and eight other Italian cities on
April 28 and will eventually have 25 trains - a new type of
locomotive-free rolling stock that has an engine under each car
to increase capacity.
Montezemolo and businessmen Diego Della Valle of luxury
goods maker Tod's, Gianni Punzo and Giuseppe Sciarrone
founded the startup in 2006.
They were later joined by Banca Intesa San Paolo,
Italy's largest insurer Generali, businessman Alberto
Bombassei from Brembo brake company and French state
railway company SNCF, which took a 20 percent stake and provides
But Montezemolo, chairman of NTV, is clearly the leading man
in a high-profile business script aimed at snatching 25 percent
of Italy's high-speed train market by 2014 and breaking even the
same year. It hopes to attract 8-9 million passengers a year by
Chiara Pelizzoni, a transport analyst for Nomisma, said NTV
will not have too many problems attracting customers in the
"The high end of the market will be easier to sell. There
are customers willing to pay for good services and from an
industrial plan point of view they have a good, experienced
partner in SNCF," he said.
"The real challenge will be if they try to enter the market
for regional routes, where it is much more complicated to make
money and where there are more regulations," she said.
The dapper Montezemolo, who looks younger than his 64 years
and sports a Bobby Kennedy-esque mane of hair, has a breathless
business resume and aristocratic family lineage that fuels his
confident, can-do style like high-octane petrol fuels a Ferrari.
He organised the 1990 World Cup football tournament, was
chairman of carmaker Fiat, managed Italy's America's Cup sailing
race challenge team, headed the powerful business lobby
Confindustria and is now running Fiat's Ferrari division
NEW ENTREPRENEURIAL CHALLENGE
But a startup was a new challenge, even for him.
"This is the first time that I have developed a company from
scratch, from zero, from a blank page. Four years ago there was
nothing, no train, no people, no organisation, nothing," he said
as the train sped toward Rome.
He enthuses about the train as if it were one of his Ferrari
Formula One race cars and it is a safe bet that the choice of
red as the NTV's dominant colour is probably no coincidence.
"This is the quickest train today. There is no other train
like it. This train can go 360 kilometres an hour but we are
obliged not to go faster than 300," he said, referring to the
limits of the infrastructure of the Italian rail system.
The 450-seat NTV trains, dubbed Italo and painted red, gold
and gray, use high-speed AGV cars built by French transport and
power engineering group Alstom.
The AGV is quieter and cheaper to run than its predecessor
the TGV and has 20 percent more passenger space because its
motors are placed under each car, instead of in locomotives at
"Can you believe we are going at 300 kilometres an hour?" he
asked as the streamlined train sped quietly between Naples and
Rome on a trip for the media last Friday.
Indeed, if it were not for the Italian countryside flashing
outside the big, oversized windows and a slight murmur inside, a
passenger might think the train was standing still.
SERVICE, STYLE, AND VALUE
NTV hopes to win customers away from the state-owned
Trenitalia, which uses the Italian-made ETR 500 on its
high-speed runs, by offering better onboard services, elegance
and free amenities such Wi-Fi, live television and first-run
The business plan uses a tiered airline-style fare structure
for its three "ambiances" - Club, Prima and Smart - and includes
low-cost fares in the Smart "ambience" for tickets that are
booked early and for off-peak times.
NTV's guiding mantra is service, style, and competition. It
offers, for example, quality meals at competitive prices served
in passenger seats instead of restaurant cars and prepared by
Eataly, the food emporium with shops in the Italy, the United
States and Japan.
All the seats, even the cheapest, are in plush leather made
by luxury furniture maker Poltrona Frau
The trains will make the Rome-Milan run in about three
hours, depending on which stations the traveler chooses, roughly
the same amount of time as Trenitalia's fast trains.
But Montezemolo is betting that travelers will choose NTV
for the overall experience, the customer service and the
Apart from Rome, the NTV network will include Salerno and
Naples in the south as well as Florence, Bologna, Milan, Turin,
Padua and Venice in the north.
And he said the company might eventually expand into
regional routes with high tourist traffic such as Florence-Siena
using different types of trains in the future.
"This is a high-risk venture for us. We have invested 650
million euros for the trains, we will pay 120 million euros a
year for the use of the tracks and we have already created more
than a 1,000 jobs with a 50-50 distribution between men and
women," he said. "If it doesn't work out, we fail."
He wants to make Italo, the sleek white jumping hare who is
the mascot of the train, as easily recognisable a brand as
Ferrari's prancing horse.
Asked if he feared a price war with Trenitalia on the
profitable Rome-Milan route he said: "Bring it on. May the best
customer experience win".