Monoderailed: Spain's Train-Station-To-Nowhere

Tyler Durden's picture


Just as California is attempting to round up the financing for its miracle-on-rails high-speed train, so Spain is finding out the reality of the over-promised and under-funded phoenix-like expectations of their own high-speed rail project. From exaggerated passenger traffic expectations 40% higher than the current slower route's traffic to the massive billion-euro debts that have already been accumulated, nothing says epic fail like the City of Villena's 4,500 square meter gleaming new train station - the only access to this building-in-the-middle-of-nowhere is a dirt track used by local farmers. The reason - simple - while the central government financed  the building, the local Valencia regional government was responsible for funding the connection to the local city and freeways - it ran out of money, leaving the station high-and-dry. As Reuters adds, the disconnect says a lot about both Spain and its current finances, about a love affair with grand projects to showcase its modernity and a diminishing ability to pay for them.


Via Reuters,

A one-track dirt road used by local farmers is the main access to a magnificent glass-and-steel train station in the small city of Villena, on Spain's latest high-speed rail route.


It is a spanking new 4,500 square meter building - essentially in the middle of nowhere.


The central government financed the rail route, inaugurated on Monday, between Madrid and Alicante on the Costa Blanca. The Valencia regional government was supposed to fund works to connect it to the nearby motorway and Villena, home to 35,000.


But it ran out of money, leaving the station high and dry.


The disconnect says a lot about both Spain and its current finances, about a love affair with grand projects to showcase its modernity and a diminishing ability to pay for them.


... the station is likely to become yet another white elephant in a country where dozens of airports, train stations, motorways or cultural centers built during a decade-long property boom are under-used or have been abandoned.


"The new route was a much needed infrastructure but there was a lot of improvisation and a complete lack of planning and it could all come to nothing, starting with Villena," he told Reuters in a telephone interview on Monday.




"Despite our budget woes, one of the objectives of the government is to stimulate investments that are truly productive so that they'll contribute to the shared objective of the government and the society: the economic recovery and job creation," he said.




On many routes, Spanish cities lack the critical size to make the system sustainable, partly explaining why the state-owned Renfe train operator and Adif station and rail company are losing money.


Renfe has a 5 billion-euro debt while Adif, rated as junk by Moody's investors service, has debt of more than 11 billion euros.




The government aimed to avoid repeating previous mistakes on the Madrid-Alicante line by using second-hand trains and reducing the number of daily train journeys. But the 2-billion-euro project may struggle for profitability.


The biggest town on the route is Albacete with only 170,000 inhabitants and the cost of a ticket for a return trip between Madrid and Alicante on the coast - 125 euros - will be unaffordable for most Spaniards.


The official projection for passenger capacity on the route was raised by 40 percent to put it at 2.2 million people every year, twice the number of people who used the 50-minutes-slower existing train service in 2012.




But on board the opening train and at the unfinished stations along the route, there was little enthusiasm.




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Wed, 07/10/2013 - 08:25 | 3736927 GetZeeGold
GetZeeGold's picture



When do we get the one in California? Just asking cause I'll never use it.

Wed, 07/10/2013 - 08:28 | 3736934 krispkritter
krispkritter's picture

At least they killed the one in Florida, for now.  Another Billion Dollar Boondoggle.

Wed, 07/10/2013 - 08:46 | 3736979 MillionDollarBonus_
MillionDollarBonus_'s picture

A monorail makes perfect sense. High speed rail is no longer just a luxury - it's now a necessity. In the 21st century, people are busier than ever, and our current infrastructure simply cannot support the rapidly growing global economy. Travelling via public transport is not only more efficient, but it also allows people to get more work done and stay connected on social networks for longer on their smartphones and tablets.

Wed, 07/10/2013 - 08:53 | 3736995 Downtoolong
Downtoolong's picture

the only access to this building-in-the-middle-of-nowhere is a dirt track used by local farmers.

Unfortunately the train doesn't work out so well when the only access to it is by mule.

I wonder if they have a hitchin' post outside the station? 

Wed, 07/10/2013 - 09:08 | 3737042 Peterus
Peterus's picture

I'd say that you're on the right track.

Volutnary forces would eventually move to rails too. Especially if subsidies to roads, oil, etc were eliminated.

Though I don't think this will work very well in USA, at least for a few decades. There is huge car culture and vast distances between cities. Metro plus city-trains still could do it, but planes will keepy carrying most long-distance travelers for purely practical reasons.

Wed, 07/10/2013 - 09:45 | 3737127 Monedas
Monedas's picture

Hurry up high speed rail .... Governor Moonbeam .... I want to collect welfare and food stamps in east LA and Frisco skid roe !

Wed, 07/10/2013 - 09:51 | 3737136 Mentaliusanything
Mentaliusanything's picture

Much as I love MDB for his/her sarcasm, I beg to differ, the "Public smell", Inter alia I think it best to let the Rolls do what it does best.... Proceed James

Wed, 07/10/2013 - 10:20 | 3737218 Monedas
Monedas's picture

MDB is a dude, Dude .... women aren't smart and daring enough to handle that kind of sick, testosterone pumped  humour !  LOL

Wed, 07/10/2013 - 10:13 | 3737194 Balanced Integer
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I wasn't sure about this post until I read the last sentence. Then it came into focus as the mighty fine piece of trolling that it is.

I junked it anyway. Nothing personal.

Wed, 07/10/2013 - 08:28 | 3736935 gaoptimize
gaoptimize's picture

There was a Simpsons episode around this theme a while back.  It didn't end well either.

Wed, 07/10/2013 - 08:43 | 3736972 Farside
Wed, 07/10/2013 - 12:21 | 3737776 FrankDrakman
FrankDrakman's picture

The government aimed to avoid repeating previous mistakes on the Madrid-Alicante line by using second-hand trains and reducing the number of daily train journeys.

Yeah, I read about this before.. something about the Rio Norte line...

Wed, 07/10/2013 - 08:29 | 3736939 e-recep
e-recep's picture

never before have people's hard work and savings been so poorly and so vastly misallocated. we are living through a period of utter disgrace and decadence thanks to central banking.

Wed, 07/10/2013 - 08:38 | 3736960 GetZeeGold
GetZeeGold's picture



That's what happens when you put lawyers in charge of economies.


You only get worse results when you put Economists in charge of economies.

Wed, 07/10/2013 - 08:55 | 3737000 CPL
CPL's picture

In a lull economically you design the future but do not build it.  When resources are available and cheap, then you build it.  Spain got caught in the inflation trap like many countries have been.   Can't project costs over a ten year project if you have 1.3% monthly inflation increases and mines closing at the same time.

Wed, 07/10/2013 - 11:37 | 3737581 Totentänzerlied
Totentänzerlied's picture

Nah, that's kind of the historical norm.

(The trend was maybe sorta broken when people kinda sorta benefited from some of these stupid projects for a while in recent centuries, but not really because they always a) cost way more than they were worth over their useful lifetime b) were poorly planned with no foresight and c) used and led to vastly greater usage of key resources for little to no incremental longterm benefit.

Just look at the US interstate system, a monument to stupidity if ever there was one, a major event in America's shift to total unsustainability, consumerism, waste, etc. and dependency on automobiles and fossil fuels. And yet we're still paying for them.

Maybe some good came out of it along the way, which can't be said of the Pyramids)

It just seems different because we have oil, so the scale of the projects is in some ways greater, and because we price it in dollars rather than man-hours, resources used, and energy input.

Wed, 07/10/2013 - 08:29 | 3736940 krispkritter
krispkritter's picture

By the way, what is a 'second hand train'?  Not sure I'd want to trust my life riding in a hand-me-down pile of rust and bolts some guy named Eduardo cobbled together in his backyard.

Wed, 07/10/2013 - 09:04 | 3737029 Peterus
Peterus's picture

Nice failure of imagination right there.

With a 50 year lifetime for some modern train, if you buy 20 year trains they will last shorter and have some wear on interiors etc. Still, they'll have to fit entire books of regulations and specifications to ride on any rail in EU.

Wed, 07/10/2013 - 08:31 | 3736948 timbo_em
timbo_em's picture

From 2000 to 2012 Spain received close to 50B Euro from EU funds to prop up its infrastructure. So this is also great example how efficiently the EU allocates capital. FORWARD!

Wed, 07/10/2013 - 08:41 | 3736967 Badabing
Badabing's picture

And we bailout to the tune of $85,000,000,000 a month.

we don't even get a train set to play with!

Wed, 07/10/2013 - 08:46 | 3736978 GetZeeGold
GetZeeGold's picture



When we get amnesty......maybe the illegals will bring us one of their's.


If not that.....maybe a drug running submarine.

Wed, 07/10/2013 - 08:33 | 3736955 Cacete de Ouro
Wed, 07/10/2013 - 08:39 | 3736963 SilverIsKing
SilverIsKing's picture

For 1 billion euro, I will build a road for them.

Wed, 07/10/2013 - 08:39 | 3736964 Skin666
Skin666's picture

This is what happens when politicians and bureaucrats are let loose with other people's money...

Don't vote

Wed, 07/10/2013 - 08:42 | 3736968 Never One Roach
Never One Roach's picture

Better to fund that Monty Python Silly Walk experiment someone posted the other day.


Wed, 07/10/2013 - 08:42 | 3736970 Notarocketscientist
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NOTE TO ALL - from what I can see Zero Hedge generates income off of ad network banners on a pay per click basis.

This is by far the most important web site in the world - and it needs to be supported.

When you visit please do the following:


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Wed, 07/10/2013 - 08:58 | 3737007 Skin666
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I prefer to voluntarily donate

Wed, 07/10/2013 - 08:48 | 3736983 I am Jobe
I am Jobe's picture

Another great idea brought about the so called geniusus.

So much for that.

Copying Amerika in waste is not acceptable. Come up with your idea.


Wed, 07/10/2013 - 08:54 | 3736997 XitSam
XitSam's picture

4500 square meters is 48,437 square feet

Wed, 07/10/2013 - 11:36 | 3737579 I_Rowboat
I_Rowboat's picture

Right, or 220 ft x 220 ft.  That's kinda big, but it's not huge.

Wed, 07/10/2013 - 08:54 | 3736999 Hobbleknee
Hobbleknee's picture

Pics or it didn't happen.

Wed, 07/10/2013 - 09:00 | 3737015 MyBrothersKeeper
MyBrothersKeeper's picture

Governments don't create jobs, capialists do. Capitalists must create services people want or need or they lose money and quality of life. Politicians spend other peoples money on ideas that don't incorporate business plans or realistic cost/benefit. They never ask questions like: "what if this doesn't work" or "what are the pitfalls". If they asked those questions to people in the private sector they would get honest answers...assuming it wasn't a clean energy like company only searching for subsides or a contract. There is no consequence of fiscal failure as there is always something or someone to blame (former guy, economy, weather etc)....which is why even when they do ask the questions, they don't listen to anything they don't want to hear. Instead groupthink is an epidemic in political circles. The need to "do something" is nothing more than a vote grab. It's more important to sell the idea to the public than actually making it work or solvent (do the words "won't raise premiums or add to the deficit" ring in your ears?). They appropriate money based on the premise and they can always find someone's research that matches their view of the numbers. They determine who the scapegoat is before it happens.

It's convoluted logic at best. How many times have we heard "infrastrucure projects"? I mean, that bridge that collapsed in US had more to do with than 80,000 lb truck that hit it. Yet 100 M spent on an African safari is supposedly a higher priority. IRS, GSA etc etc etc....this is the "fun" in the word dysfunctional.

Anyway, here is a link Tyler put on ZH some time ago to a video that really does a great job explaining how Spain got to where it is today:

Wed, 07/10/2013 - 09:01 | 3737017 Sudden Debt
Sudden Debt's picture

Reminds of a business trip I made a few years back in Laos.

I bought a plane ticket online from somewhere out of nowhere in Laos to Hong Kong.

So I went to the city where the airport was...

I slept there...

Took a cab to the airport...

I came to a large terminal...

The cab left...

I entered the building... to notice... 

 I went to the desk, let me remind you, there where like 50 people there working like the airport was opperational!!

So I went to the desk and there was this smiling lady... and she said. FLIGHT DELAYED SIR!

Flight delayed? Yes flight delayed.


She said; YES

So I waited 2 hours without any news... and I asked her is she HAD A IDEA when the plane would arrive...




I never got the money for my ticket back put they promised I would be valid if I came back. So  if anybody is going to Laos and also Hong Kong... if you want a ticket...

Wed, 07/10/2013 - 09:14 | 3737060 Fix It Again Timmy
Fix It Again Timmy's picture

Did you really expect otherwise from POLITICIANS?...

Wed, 07/10/2013 - 09:41 | 3737117 JohnF
JohnF's picture

Misallocation of capital financed by debt is the death knell of any organization. Companies that invest in a glorious future that is built on a foundation of sand deserve to go bankrupt. Countries that build wonderful infrastructure based on fantasies (you listening, California?) deserve to decline as debt burdens cripple future budgets.

Low interest rates removes the incentive to seriously consider whether a plan is feasible or not. A plan that looks profitable at an interest rate of 1% are bankrupt when interest rates are at 10%.

The lack of "skin-in-the-game" of government bureaucrats, coupled with crony corruption, will destroy any organization whilst enriching a few. Lovely game if you're in the right position, pernicious otherwise.


Wed, 07/10/2013 - 09:43 | 3737121 hookah
hookah's picture

It should be added that most of these projects has EU funding support... Central planning in big time....

Wed, 07/10/2013 - 09:45 | 3737128 youngman
youngman's picture

"the station is likely to become yet another white elephant in a country where dozens of airports, train stations, motorways or cultural centers built during a decade-long property boom are under-used or have been abandoned."

All that matters is whose name is on the building..that is how a Politician gets a hardon a naming of a building after them...all is good

Wed, 07/10/2013 - 09:51 | 3737137 Monedas
Monedas's picture

What will be the true cost .... of keeping ETA from sabotaging those high speed rails ?

Wed, 07/10/2013 - 10:00 | 3737159 22winmag
22winmag's picture

Bring out your dead.

Wed, 07/10/2013 - 10:14 | 3737204 Hedgetard55
Hedgetard55's picture

Look, they knew exactly what they were doing. Politicians got big Euros for their construction union cronies, and got a piece broken off for them on the way. 
Fuck the people or whether the project made sense - that did not figure into the equation, bitchez. 

Wed, 07/10/2013 - 10:35 | 3737275 Not My Real Name
Not My Real Name's picture

Yep. These trains to nowhere, and other ill-planned infrastructure are Union welfare.

The campaign that birthed and continues to push additional $$$$ for the California bullet train to nowhere is financed almost entirely by unions.

Wed, 07/10/2013 - 10:31 | 3737235 Monedas
Monedas's picture

Broken Keynesian window panes .... or shovel ready projects .... scientific socialism doesn't work .... it makes things much worse !  The train in Spain .... stays mainly in the .... station !  BTW .... where do you put the chickens .... on a high speed train ?

Wed, 07/10/2013 - 11:08 | 3737424 youngman
youngman's picture

on the roof...that way they feel like they can fly...for awhile...

Wed, 07/10/2013 - 12:32 | 3737820 MyBrothersKeeper
MyBrothersKeeper's picture

Good one.  Like the song in  the movie goes "funny how falling, feels like flying...for a little while"

Wed, 07/10/2013 - 11:31 | 3737536 AZLagun
AZLagun's picture

Maybe all they need is a tapas bar to get the 40% bump they overestimated for.

Wed, 07/10/2013 - 12:36 | 3737835 Hopeless for Change
Hopeless for Change's picture

A great opinion piece on why liberals love trains so much:

Wed, 07/10/2013 - 14:22 | 3738354 dunce
dunce's picture

The problem was not lack of planning, the problem was government central planning.  The first monuments to the waste involved un government central planning are still standing though some are contemplating their removal, the pyramids of Egypt. The cost was buried in the graves of the slaves. The opportunity cost is beyond measure. The debt issued to build todays monuments to government central planning will be rolled over again and again but the interest payments will last longer the the edifices to stupidity. The train station will not be there for thousands of years.

Wed, 07/10/2013 - 15:08 | 3738543 thisandthat
thisandthat's picture

To add to Spain's 1 bil Airport-To-Nowhere: (and us here complaining about the 30 mil spent transforming Beja's airforce base into an (useless) airport...)

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