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Once HSR(High-Speed Railway) starts to operate, undoubtedly, among all the western-strait transportation business in Taiwan, the Taiwan conventional Railway is the one that will suffer mostly the critical impact. Even compared with the current operated fastest train - Tzu-Chiang of Taiwan conventional railway, HSR has higher speed, therefore, the longer the travel distance is, the more travel time that HSR passengers can save. To facing the challenges of HSR, conventional Taiwan conventional railway develops a strategy called “Rapid Transit Railway,” which tries to gain more profit from short-distance railway market in order to retrieve the loss caused by HSR in medium- and long-distance railway market. However, more than 70% revenue comes from medium- and long-distance railway market in Taiwan conventional railway at present. The “Rapid Transit Railway” plan seems to be ineffective for Taiwan conventional railway to mitigate the possible loss in the future. By the data collected from the Taiwan conventional railway passengers, we investigate the customers’ decision factors that make to choose the different types of trains before and after HSR operates. We adopted Multinomial Logit Model (MNL) to analyze the variation of future market share, which connected to a demand- oriented revenue model to find the optimal passengers fare for Taiwan conventional railway. From the calculation results, we find that Taiwan conventional railway should adjust the price properly to lessen the loss of its revenue and market share. The advanced conclusions and suggestions to conventional Taiwan conventional railway as follows: 1. Since HSR don’t have too much advantages with its higher speed in short distance, Taiwan conventional railway can defense its short-distance market successfully. Moreover, Taiwan conventional railway has the chance to raise its short-distance price of passengers since it is more competitive. 2. If Taiwan conventional railway could lower 20% and 8.8% price of Tzu-Chiang in Taipei-Taichung and Taipei-Kaohsiung route when HSR operated, it should remain total 20% customer in these two major markets. 3. There is still a 30% loss in revenue from the optimal results for Taiwan conventional railway, but it would loss more if no changes.
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