The aim of this paper is to assess how the introduction of technological innovations into a capacity constrained rail corridor may increase its ability to capture market share from road transport. The Montpellier-Perpignan section, a bottle-neck in the Mediterranean corridor, is used as a case study for the effects of implementing new rolling stock that allows for freight trains up to 1500 m, a new ballastless track replacing existing one, resilient switches and crossings, and monitoring systems that allow for a reduction in maintenance costs and closure times. The results of a cost-benefit analysis show positive net impacts, however, the increases in capacity are only enough to maintain current rail freight market shares. Evidence suggests that a heavy investment in technology in existing lines is not the most effective way to increase rail market share.