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AMTRAK, LONG-DISTANCE TRAINS, AND CONGRESSIONAL FUNDING

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Without access to its books, it is impossible to know how Amtrak allocates costs across its product (service) lines. Unless one has access to the host carrier's books, he would not know the full vs. incremental cost of hosting Amtrak's trains. In FY12 Amtrak would have had a $98.1 million operating profit if it were not for the long distance trains. The State Supported and Short Corridor Trains would still have been in the red, but an average fare increase of $15 would have enabled them to cover their operating costs.   Most of the short corridor trains don't compete with airplanes. Personal vehicles and buses are Amtrak's major competition in the short corridors. A $15 average increase in coach fares would widen the gap between Amtrak's fares and most bus fares. But for single travelers, who drive a mid-size car, the increase in Amtrak's fares would still leave them well below the cost of driving for a single occupant in a personal vehicle. However, put two people in the car, and the cost advantage accrues to the car. Would an average fare increase of $15 really be needed?  Not if Amtrak's management tackled its major cost. Labor!  In FY12 salaries, wages, and benefits chewed up 50.4 per cent of Amtrak's operating costs and 70.7 per cent of its revenues.  The ratio probably was higher for the long distance trains and lower for the other two service lines (NEC and short corridor).  Amtrak must find a way to reduce its labor costs if it is to be a viable commercial enterprise. The opening point for this thread was Congressional funding for the long distance trains.  Given the debt burden of the United States (federal, state, local, personal), the Congress is not likely to come up with a lot of money to expand long distance trains. It may not even come up with the money to sustain the current long distance trains.
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