'Arrow' sets Germany a-quiver: Bonn has given the green light to the world's first magnetic hover rail service. John Eisenhammer on the huge risks and cost of this 'symbol of the future'

THE IDEA may be 60 years old, but as far as the German government is concerned, it represents the revolutionary technology of the 21st century. Shutting its ears to warnings of a Concorde-style flop, an enthusiastic cabinet in Bonn yesterday celebrated final approval for the building of the world's first large-scale magnetic hover rail service.

It will begin running between Hamburg and Berlin by 2005 at the latest, and has estimated start-up costs of DM9bn ( pounds 3.5bn).

'The Transrapid is a symbol for the future that we urgently need,' said Matthias Wissmann, the Transport Minister. Paul Kruger, his counterpart at Research, said: 'For me, the Transrapid is a symbol of Germany's new beginning in technology.'

The enthusiasm with which the highly controversial project has been seized by the government reflects a desire to show the world that Germany has lost none of its innovative prowess.

'Are we able as a technology- based nation, which our jobs depend on, to make decisions for the future?' asked Mr Wissmann. 'Or are we a nation of doubters who endanger jobs by their tendency always to postpone decisions?'

The deep recession has produced much nail-biting among Germans over whether their appetite for risk has declined and their presence at the leading edge of tomorrow's technology is shrinking perilously.

The news last year that France had won the contract to supply South Korea with a high-speed rail link against competition from Germany's finest was like a slap in the face. France has a 10-year start on Germany in high-speed rail development, which is proving difficult to make up. The building of the Transrapid is to show that such mistakes will not be made twice.

The project is revolutionary industrially and financially. Although many countries have toyed with the technology, none has yet dared to risk realising the dream of the train without wheels as a commercial venture. The latest prototype, built by Thyssen, Siemens and AEG, the TR07, which hovers just 10 cm above a broad, concrete rail platform housing the magnetic field that propels and brakes the train, is capable of speeds up to 500km per hour.

With passengers on board, the 50 metre-long, 90 tonne train, would be limited to speeds of 420 km per hour. The current rail journey time between Berlin and Hamburg of three hours would be slashed to under 60 minutes along the new 284km track on stilts. Not even Lufthansa can beat that. Because it has no wheels, the noise factor is limited to the wind resistance - hence the name 'Whispering Arrow' given to the Transrapid by its enthusiasts.

For the first time in Germany, the private sector is being extensively included in the funding of an important infrastructure project. The plan foresees the government putting up DM5.6bn, on top of the DM2bn already spent on research and development grants, for the building of the track, which is the most expensive part of the venture. Construction is scheduled to begin in 1996, eventually creating 8,000 jobs. The government hopes to recoup some of this investment from a small share of the operating earnings.

A further DM3.3bn is to be raised by the private sector, which will be responsible for the trains and operating the service. A holding company will be formed for this purpose, with equity capital of DM1.5bn. The main industrial partners, along with banks, are to provide DM700m; Lufthansa and German railways will put up a further DM300m; the remaining DM500m will come from private investors.

Hermann Kemper, a German engineer, registered the patent for 'a floating train with wheel-less units' in 1934. In the Sixties, Thyssen really got its teeth into the idea, but continued to run up against vehement scepticism from German railways. The Americans tried it and lost interest. The Japanese played with it, too. Only the Germans kept plugging away. Visitors to the Hamburg transport show in 1979 were given a refined taste of high-tech levitation. Then, in the early Eighties, a 31km test track was built in northern Germany on the Dutch border. For the past 10 years, successive prototypes have been going round in circles there.

In 1991, German railways finally agreed to place its seal of technical approval on the Transrapid, just as the government was beginning to cast round anxiously for a high-tech industry flag-waver. The Americans have re-awakened their interest in developing the hover-train technology; the Japanese are building an 18km test track. For the moment, the Germans judge themselves to be five years ahead of the Japanese and 15 ahead of the Americans.

Mr Kruger warned: 'If we do not take the decision to build the Transrapid now, one of these days we shall have to import it from somewhere else.'

But as Concorde so painfully demonstrated, winning technological plaudits is one thing, and making the sums add up is another. Just as western Europe is committing itself to a high-speed rail network of the future, sceptics are asking whether it makes sense to bet so heavily on a partly rival project with highly questionable prospects.

'At best, the Transrapid is superfluous as an isolated solution in Europe's railway network, and in the worst case it is a mill-stone around the neck of the German railway,' warned Klaus Daubertshaeuser, transport expert of the opposition Social Democrats.

The cabinet's green light yesterday came less than a month after a critical report on the Transrapid's financing by a commission of independent advisers to the transport ministry. The estimated costs of building the track are too low; the projected earnings too high; and the export prospects totally unknown, the advisers warned.

They also said the private sector's commitment to the financing of the project was far from satisfactory. 'If industry is so convinced of the world market potential of the hover train, then one would expect a higher risk-preparedness from it, especially given its view that the project marks a decisive step towards capturing new international markets,' they wrote.

Looking askance at passenger forecasts of 14.5 million a year, they concluded: 'There is no way that one should base a private financing plan on such political wishful- thinking.'

Behind the scenes, the arm-twisting between the state and private industry over the risk-sharing goes on. In Parliament, the opposition is expected to give the Transrapid legislation a rough ride, demanding that the private sector bear more of the costs. But yesterday, there were no grimaces in evidence, only broad smiles.

(Photographs omitted)