This post is making the assumption that the new Pullman Chicago - New Orleans service will be successful and will continue.
So, could Amtrak long distance trains be made self supporting with the following:
Amtrak provides only a basic but comfortable, clean, and on-time coach service. I never did ride overnight in a Superliner or Horizon coach, and I don't really know how comfortable it would be. I did have an LA - Chicago trip on the old El Capitan, and enjoyed it. Also, a number of overnight trips in the Juniata-buitl PRR 44-passenger coaches (Trail Blazer, Jeffersonian, Red Arrow, JU\uniata), which were just as comfortable, even though the low-qaulity steel the PRR used in their construction caused preamature rusting, and they were scrapped after about 10-15 yeas of use, with their easy riding trucks used on rebuilt P-70's. Meals would be handled with catering by the best of those that provide airline meals and would be included in the price of the ticket when the travel time exceeds two or three hours and covers meal hours, served at seat. No Amtrak diners or sleepers.
Sleepers and dining cars would be added to Amtrak trains where and when the private operator(s) would find them profitable, and would provide a level of service that Pullman provided. In certain cases the private operator would permit coach passengers to use the dining car, and the meal charges would be high enough so the added meals would be worth serving. Otherwise, again, for the 1st class passenger, meals would be included although the specific fare and meal arrangements would be ujp to the private operator(s). However, Amtrak would contiue to be responsible for the mechanical maintenance and repair of the cars.
I think such a division of responsibility would improve Amtrak's bottom line, possibly to the point where lD trains could break even overall.
Although I am probably in a minority for saying this. I think Amtrak undercharges for sleeping car space. The charge also appears to be based on mileage traveled in the sleeper or inventory available. Not the difference in prices between Chicago to DC between the Capital Limited and Cardinal for example......even a year out there is a difference in price so I am not sure it is yield management. My guess is Amtrak came up with a base per mile charge based on their equipment charter rates and that forms the base of the sleeper charge. Just a guess though.
Anyways back to sleeper service. I am pretty confident the Pullman service using private railway cars from the AAPRCO pool will charge a significant premium over Amtrak because those railway car owners have to cover all costs or they lose the ability of the car to travel on the rail system.
Amtrak should upgrade it's vacation packages as well as it's sleeper car fees to cater to a more upscale clientele as well as the average passenger. I mentioned before that private railroads used to do this but I have not seen Amtrak do it. One size fits all for Amtrak passengers, everyone is middle class in this country and are all in the same boat..........thats Amtraks approach. Their charges for business class or the Bedroom vs roomette...........the spread isn't that great. In fact it is just a marginal increase in cost, IMHO.
I'm pessimistic about the success of the first-class Chicago-New Orleans service, basing this on the record of American European Express, both when it was five cars attached to the "Capitol Ltd" and later as a separate operation.
That being said, I'm not sure that there is that much of a market for long-haul sleeping car service that charges enough to be profitable with the labor-intensive level of service implied by daveklepper's proposal. As far as dining-car service, that has customarily been viewed as a loss leader even with the relatively steep prices charged so I doubt that contracting out the service would change anything.
Also, existing labor contracts would have to be considered so this proposal may not even get off the ground without contract buyouts.
As I say, I am assuming the Chi - NO service will be successful. If it is not, than my proposal does not have merit.
Dave,
I think you mean that Amtrak would contract with a third party to provide its sleeping car service (both the cars and the personnel) in the same way that private railroad companies once did. The sleeping car service provider would set the price for the sleeping car accommodation and Amtrak would charge for transportation.
Today it is quite popular for government agencies to contract out certain services. The advantage is generally that the private contractor offers lower salaries and less expensive benefits and can therefore perform the service more cheaply than government does. Also, Amtrak would not have the capital investment in sleeping cars it has now. The disadvantage is that Amtrak would have less control over the quality of the service or the quality of the equipment.
P. S. Most Pullman cars were open sleepers. Amtrak does not use open sleepers although other railroads do including VIA Rail.
I can only offer an intuitive response. If I could raise the capital to set up such a business I would be reluctant to do so. Supposing I invested in sleeping cars and Congress suddenly decided to either cut out long distance routes or all Amtrak trains together. What then do I do with my sleeping cars? Sell them to railroads in other countries? I just don't think Amtrak's future is secure enough to make the investment.
Rail and sleeping car fares probably are a function of demand, space availability, and mileage. Sleeping car charges probably are also influenced by time on the train inasmuch as first class passengers have the cost of meals baked into their fares.
I did a comparison of the fares from Chicago to New York for the Lake Shore Limited, Cardinal, and Capitol Limited. Travel is for one person in a roomette on December 8th, which is a Saturday. It was chosen arbitrarily. Fares for other travel dates will vary widely.
The rail fare on all three routes is $97. However, the room charges vary significantly, from a low of $141 on the Capitol Limited to $266 on the Lake Shore Limited and $467 on the Cardinal. In addition, a passenger choosing the Capitol Limited and wanting business class from Washington to New York on a NE Regional would have to pay an extra $41. The total fares would be $279 on the Capitol, $363 on the Lake Shore Limited, and $564 on the Cardinal.
The Capitol is equipped with Superliner cars, which can carry a maximum load of 44 passengers. The other two trains are equipped with Viewliner cars, which can carry a maximum load of 30 passengers. I am not sure how many sleepers are assigned to each train, but when I rode the Capitol Limited several years ago it had two sleepers and a transition sleeper. I also rode the Lake Shore Limited approximately five years ago; it had three sleepers. I have never taken the Cardinal, but I have seen it pulling into Chicago. It had one sleeper. Perhaps someone can comment on the number of sleepers assigned to each train.
If my count of the sleepers is correct, the Capitol can book 88 passengers in the two regular sleepers and 16 overflow passengers in the transition sleeper for a total of 104 first class passengers. The Lake Shore Limited can accommodate approximately 82 first class passengers, depending on the number of rooms that have to be blocked to accommodate the crew. The Cardinal probably can take 24 to 26 first class passengers, again depending on how many rooms have to be blocked for the crew. Moreover, the Cardinal is hobbled by the fact that it only runs three days a week.
If my assumptions of the available space are correct, the fares for the Capitol Limited may be lower in part because of a higher number of rooms and room capacity. If the total cost of the service is essentially the same or at least close, Amtrak can charge a lower fare for the Capitol because of the greater number of spaces and still cover the costs. Of course, the problem with this analysis is Amtrak does not cover the costs; it simply reduces the loss.
As currently opperated it seems the sleeping car itself costs a bit more than $3/mile to operate, inclusive of capital. The question is always how to cover the base train operation costs. you need a long train to do so.
I have never taken the Cardinal, but I have seen it pulling into Chicago. It had one sleeper. Perhaps someone can comment on the number of sleepers assigned to each train.
When I rode in October a few weeks ago the Cardinal had one Viewliner Sleeper. The crew used 4 rooms as I recall.
If the true cost to operate a sleeping car is $3-$4 per mile then divided by an occupancy of 20-50 is a marketable rate per mile based on 100% occupancy
Politically it seems a winner. Congress has always felt uncomfortable operating a business but has seemed willing to offer coach service as a social need.
I am not sure I would let the government off the hook on the dining service.
As to the investment risk I would have the government guarantee the loans to purchase the sleepers. If Amtrak discontinues Long Distance Service just as there would be a lobor buyout so there would be a settlement for sleepers privately funded.
Dixie,
I don't know what the union contracts with Amtrak provide. However, ordinarily if the Federal Government eliminates a position there is no obligation to buy out the person holding that position. There are bumping rights; a person whose position is eliminated has a right to other positions which he or she is qualified to do provided the person in that other position has less seniority. And a person who is a Federal Employee and is laid off when a position is abolished has a right to return if a new position opens within his or her qualifications. Finally, Amtrak could arrange with a new private sleeping car operator to give Amtrak employees jobs to the extent that jobs are available and the laid off employees want them.
There are times when the Federal Government has a reduction in force (RIF) and suddenly hundreds of Federal employees lose their jobs.
According to the DOT Inspector General’s Report on Analysis of Cost Savings on Amtrak’s Long-Distance Services dated July 22, 2005, elimination of sleeping cars, dinning cars, and lounge cars would reduce but not eliminate the losses associated with the long distance trains.
The DOT analysis was focused on reducing the losses associated with the long distance trains. It assumed that the 2004 routes would be retained. It did not propose eliminating them altogether.
If the aforementioned services were dropped from the long distance trains, leaving coach only services with minimum on-board food options, i.e. box lunches, carts, etc., Amtrak could save approximately $75 to $158 million annually. It would also save an estimated $79 million per year in planned capital expenditures. These estimates are in 2004 dollars. When adjusted for inflation using the Bureau of Labor Statistics CPI calculator, which is a rough estimate, the amounts would be $89.3 to $188.1 and $94.1 million in 2011 dollars.
In FY11 the long distance trains had an operating loss of $615.4 million before allocation of depreciation, interest, and miscellaneous charges. If the maximum savings were realized, Amtrak would still have had an operating loss of $437.3 million on its long distances trains.
Elimination of the capital spend for new sleepers, dinning cars, and lounge cars would reduce the depreciation charges in future years and, therefore, could result in a further reduction of the operating loss. If the lounge car was retained, the savings as per above would be reduced by $52.4 to $$39.3 million in 2011 dollars.
With numbers like these, even when adjusted for the fact that they are getting a bit long in the tooth, it is difficult to see how Amtrak could break even on any of its long distance services without a significant change in its business model, i.e. drop the sleepers and dinning cars as well as institute other significant cost saving strategies, i.e. elimination of checked baggage, etc. It might be able to get there, but not with the current mind set.
The IG also found that the federal subsidy for sleeping car passengers was approximately 208.9 per cent of the subsidy for coach passengers. When adjusted for inflation, the average sleeping car subsidy in 2011 dollars was $395.62, bringing the average cost of the service to $632.59. To generate a reasonable return on its sleeping car service, which includes meals in the dinning car, a private operator probably would have to raise the room charges significantly or find a way to drastically cut the costs or some combination thereof. I doubt that there is enough demand to support such charges.
sam -- link to report ?
blue streak 1 sam -- link to report ?
This IG's report has been around for a long time. It can be found at: www.oig.dot.gov/sites/dot/files/pdfdocs/CR-2005-068.pdf. Other sources include the BLS calculators. The calculations are my own.
The DOT IG report also showed the investor railroads paying Amtrak to use their trackage rights. In other words an obvious error in accounting. There were a few more errors I can't recall right off hand.
It also assumed no more checked baggage for any passenger or more than one engine per train which is often not allowed per agreement with the host RR. NARP has a pretty good rebuke to the report.
Check your private messages.
I used data from the IG's report to make two key points. Outsourcing the sleeping and dinning car services would still leave Amtrak's long distance trains with a substantial operating loss. Equally important, given the then subsidies required for sleeping car passengers vs. coach passengers, it is difficult to see how a private operator could cover the costs and earn a return on its invested capital, which would be the only motivate for someone to take over the sleeping and dinning cars on Amtrak's long distance trains. Admittedly, the subsidy ratios may have changed between 2004 and today, but I suspect that the subsidies for sleeping car passengers are still greater than the subsidy for coach passengers.
I did not see any mention in the report of trackage rights. I ran a search on freight, foreign, rents, tariffs, trackage, trackage rights, and rights. The only hit I got was on rights, which was a reference to labor's bargaining rights.
Without access to the IG's work papers, it would be difficult to determine whether the analysis team made any serious method and application errors. As is the case with any cost study, some assumptions have to be made, and they are subject to challenge.
I noted that one of the recommendations was to eliminate checked baggage.
Whether any of the hoist railroads would object to only one engine pulling three or four coaches has not been borne out by results at least on some routes. The Texas Eagle, City of New Orleans, and Pennsylvanian, which have more than three cars, as examples, only have one engine. They are hoisted by three different railroads.
The DOT IG's investigation was an external review of Amtrak's long distance train operations. Most of the team members appear to have come from outside of Amtrak's IG office and, therefore, helped ensure the independence of the analysis. They didn't have a dog in the hunt.
NARP is an advocacy group. It slants most data to support the views of its members. As far I could determine when I belonged to it, NARP did not have a creditable accountant or financial analyst on its staff. In fact, the staff people with whom I spoke appeared to be rookies out of college for just a few years. NARP's webpage had several errors regarding airline subsidies, which I brought to the attention of management. I did not get a response. Here are two examples.
NARP claimed that the commercial airlines were the sole beneficiaries of the monies transferred from the general fund to the Aviation Trust Fund. Not true! First, air traffic control operations is covered by an earmark fund, which means that most of its costs are covered by revenues. Second, the commercial airlines make up approximately 30 to 35 per cent of the FAA's control activities. Not 100 per cent as implied by NARP. Most of the transfer goes to airport improvements, aviation safety, etc. The commercial carriers benefit from these investments, but they are not the sole beneficiaries. This information can be found in a variety of FAA documents.
NARP claimed that the legacy airlines that had filed for bankruptcy had their pension plans bailed out by the Pension Benefit Guarantee Corporation (PBGC). This is true. What they didn't acknowledge is the PBGC is an insurance company owned by the United States. The carriers had paid premiums for the coverage; they were simply cashing in on the policy. In this sense they were no different than any other company that had declared bankruptcy whilst being covered by PBGC.
Based on my more than 22 years of audit and investigation experience, If people don't like the overall message of an audit and investigation report, they look for any reason under the sun to discredit it. If they find an error, they generalize it to the whole report. See, they say, the auditors or investigators did not know what they were doing. It is akin to finding an error on Page 225 of your automobile owners manual and assuming that everything in the manual is incorrect.
I searched the internet for the 2005 report on Amtrak sleeping car service that another poster refers to but I could not find it. However, I did find a report from the National Association of Railroad Passengers which rebuts the above report. A link is below in order that all may be able to read the NARP report and draw their own conclusions:
http://www.narprail.org/resources/capitolhill/statements/339-narp-rebuttal-of-dot-inspector-general-report-on-dining-and-sleeping-cars
John WR I searched the internet for the 2005 report on Amtrak sleeping car service that another poster refers to but I could not find it. However, I did find a report from the National Association of Railroad Passengers which rebuts the above report. A link is below in order that all may be able to read the NARP report and draw their own conclusions: http://www.narprail.org/resources/capitolhill/statements/339-narp-rebuttal-of-dot-inspector-general-report-on-dining-and-sleeping-cars
The IG's report is relatively easy to find. I just Googled DOT IG's report on long distance train ..... It popped up immediately with NARP's response in the number two position.
To gain an understanding of the methodologies deployed by the IG, one must read the entire report, including the footnotes. Doing so is important for an understanding of how the findings were derived.
NARP is a special interest advocacy group. It does not have the staff to compete with the IG's horsepower. Nor is it independent. Its attack on the report's findings are heavy on opinion, light on analytics, and filled with anecdotal observations.
Here is one example: "There is no scientific way to allocate costs between coach and sleeper. Once the decision is made to run the train, any such allocation is arbitrary. Clearly, the OIG’s assignment of 100% of dining, lounge and checked baggage service costs to sleeping-car passengers is wrong."
If NARP's staff understood activity based cost accounting, they would know that their statement is incorrect. Activity based cost accounting is not a science in the sense that physics or math is a science. But it follows a rigorous methodology that is reviewed by independent reviewers at each key step along the way.
I did not interpret the report to say that 100 per cent of checked baggage costs are attributable to sleeping car passengers. Also, the checked baggage cost is not the major driver behind the loses incurred by the long distance trains.
Here is another example: "The OIG’s tables which attempt to neatly assign precise subsidy levels to coach and sleeping-car passengers are meaningless. Such phrases as the following, based on the OIG’s incorrect conclusions, are wrong and should not become the basis for public policy: “disparity between the level of subsidies for coach class service and the level of subsidies for sleeper class” and “the cost of the sleeper class and other amenities is so expensive that the revenues pale in comparison.” These phrases are polemic and misleading because they obscure the high degree of subjectivity (and, in our opinion, inaccuracy) inherent in the OIG’s attempt to segment subsidy levels by class of service." NARP does not offer any counterpoint data nor does it provide any substance in its argument that the methodologies are flawed.
The report recognized that some sort of food service would be required on long distance trains, but pointed out rightly that the current business model, i.e. dinning cars and full length lounge cars are not cost effective. NARP did not offer any supported counterpoints.
If I were the Executive Director of NARP, and I wanted to attack the report, I would have hired an independent national consulting firm like Booze, Allen & Hamilton to dig into the data with the same degree of thoroughness as the IG deployed and come up with sustainable counterpoint data. Clearly, NARP did not do that.
Amtrak's management, staff and Board of Directors had an opportunity to comment on a draft copy of the report. We don't have access to any edits that they proposed or whether they were accepted. However, it should be noted that Amtrak's management and the board accepted the IG's findings and recommendations. Had they believed that the report was seriously flawed, they probably would not have accepted it.
Subsequently, as has been discussed in these forums, the food service on Amtrak's long distance trains (dinning car and lounge car) has proven to be a major cost issue. If anything it has gotten worse since the IG's report.
I belonged to NARP for two years. I did not renew my membership because of the organization's blind adherence to a passenger train mentality that is long past its usefulness. NARP is against any change in the current model no matter how broken it is. It wants to keep running long distance passenger trains as if it is 1950.
The IG's report did not go far enough. It should have recognized that the long distance trains serve little if any public need. They should be discontinued, and the resources should be used to enhance existing corridors or develop new ones.
The problem is the DOT IG used the RPS system to account for the costs, for which it was never meant.
On Page 26, for the Sunset Limited costs, in the Direct Cost table, Payments to Host RRs is shown to be negative, aka the host railroad is paying Amtrak.
They also assumed that:
"No coach passengers would abandon Amtrak if they no longer had access to amenities such as full-service dining cars, lounge cars, and checked baggage service." I don't see that being the case.
It was a pretty halfhearted report overall. Almost all the saving came from eliminating any amenities, not necessarily the sleeping cars.
I do not believe NARP is the same as DOT or any of its parts. DOT is a Federal Government agency; NARP is a private organization.
But I do believe that information about the 2005 IG report should be on the table so anyone who wants to may read it and draw conclusions. To hide the NARP report would be a mistake.
On occasion an expense account will have a credit balance due to a prior period adjustment, i.e. an overpayment in the prior period is being adjusted in the current period and shows as a credit. Without access Amtrak's accounting records, as well as the project work papers, it is impossible to know for sure.
In another audit report prepared by Amtrak's IG on billings from and payments to hoist railroads, including incentive payments, the auditors found several errors. I don't remember all the details nor do I intend to dig out the report, but over and under payments are common.
The accounting for the Zephyr appears to be correct, suggesting that the notion of prior period adjustment is the reason for the credit balance in the Sunset account.
When people don't like the results of an audit or investigation, they look for any little mistake to discredit the report. When they find an error of fact or method, they generalize it to the whole report. They rarely offer any solid support for their views.
If one believes the report is flawed, as NARP did, they should show why with the same analytical rigor that appears to have been deployed by the IG. Claiming that the report was halfhearted without any solid support is not persuasive. What makes it doubly so is that no one posting to these forums, as far as I know, has or has had access to Amtrak's accounting records. Without that access it is difficult to build a counter case against any reports issued by Amtrak or issued by independent agencies auditing or investigating Amtrak.
John WR I do not believe NARP is the same as DOT or any of its parts. DOT is a Federal Government agency; NARP is a private organization. But I do believe that information about the 2005 IG report should be on the table so anyone who wants to may read it and draw conclusions. To hide the NARP report would be a mistake.
NARP is definitely not a federal government agency. It is an advocacy group pushing the perceived agenda of its members. Generally speaking it lacks the resources to mount a sophisticated counter argument to the IG or anyone else for that matter.
The IG report and NARP's response are there for anyone who knows how to use a search engine, i.e. Google, Bing, Yahoo, etc. to find. No one is trying to hide or surpress NARP's attack on the report. Having said that, I find NARP's attack to lack the same robust substance contained in the IG's report.
I note that trains 66 and 67, Boston - Newport News, overnight, do not carry any sleeping cars at the prsent time. I would think this would be a logical market for a private sleeping car operator. Possible markets include overnight Boston/Providence - Baltimore/Washington/Richmond overnight business travel, and American heritage vacation travel to Boston and Colonial Willliamsberg. On the Chicago - New Orleans route the new operators are comperting with a reasonable standard of sleeping car service that Amtrak itself provides, but Boston - Newport News might be a better test case for my idea.
Something I noticed about current Amtrak Sleeper pricing. Amtrak uses price buckets. I noticed this in following pricing for the Texas Eagle. For some time northbound, a roomette was $168 for a particular city pair, then as the date of departure approached and/or available units diminished, the price increased to $274, then dropped to $221 a few days before departure when units were still available. Pricing southbound was $368 with 5 units and fewer remaining. Southbound sold out; northbound did not.
Throughout this thread it seems pretty obvious sleeper cost or subsidy is more than twice a coach cost. If you have 25 in the sleeper and your goal is 50 on the coach your sleeper cost per passenger is a minimun of double coach. If you were a private operator ways to keep costs down would include:
1) Operate your sleepers (Like the Auto Train) between city pairs where two cars cover the route with ample time for maintianance.
2) Operate at 100% occupancy. Anything less with the smaller number per car sends the price through the roof. Depend on coach travel to accumulate and disperse passengers beyond your sleeper service.
3) Use higher capacity accomidations to reduce costs. Three tier berths, open sections, duplex rooms and slumbercoaches. A single person cannot occupy a viewliner room unless they pay two rail fares and the accomidation charge.
4) Seperate the meals from sleeping car fares. I have just felt this was a ploy to blame dining car costs on sleeping car service. The origjinal Amtrak legislation was to provide full meal service on trips over (6?) hours and the availabity and quality of that service is crucial to long distance trains whether sleepers are present or not.
5) Pay Amtrak 20 coach fares per mile to haul the sleepers.
This would work for the overnight business market for expense account and middle-class travelers. It would not work for long distance vacation travel because the high occupancy sleeping quarters would feel claustraphobic to people who demand luxury. I think Bostn - Washington would work well, Chciago - Twin Cities, LA - SF, Chicago - Kansas City, New York Montral, New YOrk - Cleveland. But not Chicago - West Coat or even Chicago - New YOrk. See the PUllman Chi - NO thread ofr my postings ona potnetial Boston - Wiliiamsburg market, probably requiring double the fares you would charge but including gourmet meals.
Sam1 blue streak 1 sam -- link to report ? This IG's report has been around for a long time. It can be found at: www.oig.dot.gov/sites/dot/files/pdfdocs/CR-2005-068.pdf. Other sources include the BLS calculators. The calculations are my own.
This IG's report has been around for a long time. It can be found at:
www.oig.dot.gov/sites/dot/files/pdfdocs/CR-2005-068.pdf.
Other sources include the BLS calculators. The calculations are my own.
fixed the link so it works (all you have to do to get a link to work live is hit "enter" after you paste it into your post...)
"I Often Dream of Trains"-From the Album of the Same Name by Robyn Hitchcock
daveklepper This would work for the overnight business market for expense account and middle-class travelers. It would not work for long distance vacation travel because the high occupancy sleeping quarters would feel claustrophobic to people who demand luxury.
This would work for the overnight business market for expense account and middle-class travelers. It would not work for long distance vacation travel because the high occupancy sleeping quarters would feel claustrophobic to people who demand luxury.
"People who demand luxury?" Why should Amtrak be spending so much money to serve so few at a loss? Forget about fares in the 60's corrected for inflation. The rails lost money on pullman services then. Instead, you would have to determine the true cost (not just direct costs but also the difference between a luxury sleeper car with 55% occupancy, if that, replacing a coach with much higher occupancy) to provide "luxury" now and charge accordingly. I doubt if enough people would pay. Pretty clearly no operator is making a go of that type of service in the recent past or currently.
C&NW, CA&E, MILW, CGW and IC fan
Thank you for the link to this interesting report, Carnej. I can understand NARP's consternation, especially with this kind of conclusion: " The elimination of sleeper service alone, without the elimination of any associated food service or other amenity, produces a net loss on an operating cost basis under assumptions B and C on most routes." (Emphasis added.)
Actually, this report is not about eliminating sleeping car service. Almost all of the loss is attributed to the dining car. It seems to me there is a simpler solution. Charge sleeping car passengers for meals just as coach passengers are charged for meals. According to the report, that would cover almost all of the loss.
In 2005 President George W. Bush did oppose Amtrak and wanted to eliminate all subsidy for it. That would have driven Amtrak into bankruptcy. However, by October, 2008 President Bush had revised his position. The Wall Street Journal reported he signed legislation that doubled the Amtrak subsidy. Here is the link: http://online.wsj.com/article/SB122298615110699903.html
John WR Thank you for the link to this interesting report, Carnej. I can understand NARP's consternation, especially with this kind of conclusion: " The elimination of sleeper service alone, without the elimination of any associated food service or other amenity, produces a net loss on an operating cost basis under assumptions B and C on most routes." (Emphasis added.) Actually, this report is not about eliminating sleeping car service. Almost all of the loss is attributed to the dining car. It seems to me there is a simpler solution. Charge sleeping car passengers for meals just as coach passengers are charged for meals. According to the report, that would cover almost all of the loss. In 2005 President George W. Bush did oppose Amtrak and wanted to eliminate all subsidy for it. That would have driven Amtrak into bankruptcy. However, by October, 2008 President Bush had revised his position. The Wall Street Journal reported he signed legislation that doubled the Amtrak subsidy. Here is the link: http://online.wsj.com/article/SB122298615110699903.html
Technically Amtrak has been insolvent since near the get go. It is a ward of the state; it cannot be driven into bankruptcy. It can, however, have its funding withdrawn or decreased,in which case most of its operations would have to be discontinued.
This post was an inadvertent duplication. I deleted it.
The following quote from the report suggests that elimination of the sleeping cars and dinning cars was a critical element in the IG's repport:
“Our analysis eliminates the revenues and expenses associated with sleeping cars and food service. Overall, our analysis shows that eliminating sleeping cars, dinning cars (sleeping class fares include meals in the dinning car) and other amenities (on board entertainment, lounge seating, checked baggage service, and food and beverage service on Amtrak’s long distance routes could save between $75 million and $158 million per year in operating costs and avoid an additional $79 million in planned capital expenditures.”
I find it hard to conclude that the IG was not recommending the elimination of sleeping car service. However, the report does allow for the possibility of modified sleeping car service, i.e. trimmed down, but it would still not be able to cover its capital costs.
The report recommends that Amtrak study the recommendations, direct and otherwise; and review its operations of the long distance trains for potential cost savings. The Amtrak Board of Directors, which was a recipient of the report, apparently agreed to take the IG's findings on board.
Irrespective of the IG's recommendations, few if any changes have been implemented. Amtrak is running its long distance trains as if it is the 1950s, ala sleeping cars, dinning cars, lounge cars, checked baggage, etc. And it is losing more money on them than ever before, i.e. $515.1 million in FY09; $569.6 million in FY10, and $615.4 million in FY11. And these numbers are before depreciation, interest, and miscellaneous charges.
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