And a reduced fear in particular for motorway companies, including the most important: Vinci and Eiffage. If they had fallen by 11 and 15% on the Monday following the European elections, they rose by 3.50 and 4% respectively at midday on Monday.
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Remember that the nationalization of highways is an electoral promise by Marine Le Pen kept in 2022 and the RN is keeping it in order to promise to reduce the prices asked of citizens when passing through tolls.
The issue is also very popular because the motorway companies, which do not own but have managed these roads under concession since 2005, have largely made their investments profitable and have increased prices (despite a price freeze decided by the State French between 2015 and 2022). A confidential report written by the General Inspectorate of Finance even reported over-profitability. But this 2021 report would have been “stifled” by the Minister of the Economy Bruno Le Maire, according to the Chained Duckwho took the opportunity to publish an article on the subject in 2023 and has since been widely reported in the French press.
Let us also point out that these companies pocket more than 10 billion euros thanks to tolls each year.
An “unpayable” bill of 50 billion euros
This was enough to arouse the anger of citizens. Nevertheless, the contracts signed by the French State with these motorway companies tie its hands. “Renationalising” the whole thing (the term is misleading because the State is still the owner but is not the manager) would cost the State around 50 billion euros to break the contracts and reimburse the tens of billions of euros put on the table by these companies.
“It was a jackpot for the companies that operate the highways, hence the recurring criticism. I really think the state got ripped off. That’s a general opinion.“, recognizes the economist Eric Dor (IESEG School of Management in Lille) in this regard. “However, renationalizing legally – without carrying out a coup d’état and without massively dispossessing investors as in some countries – would not be a good deal for France.“, he continues. “A tax on surplus profits would be possible, as for energy companies which took advantage of windfall effects during the crisis“, he mentions by way of parentheses.
guillement“Macron’s entire strategy, “choose France”, aimed at investors, has been undermined”
“The financial markets are reassured this Monday, because even if the scenario of the RN with a majority is not excluded, it is only unlikely and they will not be able to implement their program and cause all the damage that could have been feared. But let’s keep the usual tweezers. Nobody owns the voters’ vote“, he says.
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“This is why the gap between French and German ten-year rates has narrowed and why motorway companies have recovered a little. It is even a double relief, because neither RN nor New Popular Front (NFP) will probably have a majority, because both programs worried investors.” he continues.
guillement“It’s interesting to note that Bardella removed a piece of the RN program with each speech, to appear reasonable”
But a relief that could be short-lived, according to him. “It is likely to remain volatile in the coming months. Anglo-Saxon investors have even admitted to preferring a form of inaction, to avoid damage, but the excessive deficit and the reforms that will not be carried out will weigh heavily. It’s not going to be easy without a majority. It cannot be ruled out that continued political instability could end up harming investors and business.“, he tackles. “Macron’s entire strategy, “choose France”, aimed at investors, is being undermined”he continues.
“And it is interesting to note that Bardella removed a piece of the RN program with each speech, to appear reasonable. But let us remember that it is a party which does not have a pro-business culture, which is protectionist and wary of competition“, concludes the economist.
