News Wire: Amtrak to stop operating special trains, charter moves

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Posted by Brian Schmidt on Wednesday, March 28, 2018 2:42 PM

WASHINGTON — Special trains and certain private varnish moves will no longer be allowed on Amtrak routes according to a brief notice of a policy change sent to Amtrak employees and obtained by Trains News Wire Wednesday morning. “Generall...

http://trn.trains.com/news/news-wire/2018/03/28-amtrak-to-stop-operating-special-trains-charter-moves

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Posted by BaltACD on Wednesday, March 28, 2018 5:40 PM

Wonder if that will include the annual GOP 'leadership trip' to the Greenbrier?

         

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Posted by Steve McDonough on Wednesday, March 28, 2018 6:42 PM

This is the reaction you should expect from a former CEO of Northwest and Delta Airlines. Amtrak accidents are up this year even though they are not Amtrak's fault. Don't blame anyone else but the beancounters. AAPRCO will be hit hard by this news.The only way to stop this is to write your congressmen,NOW!!!

WASHINGTON — Special trains and certain private varnish moves will no longer be allowed on Amtrak routes according to a brief notice of a policy change sent to Amtrak employees and obtained by Trains News Wire Wednesday morning. “Generall...

http://trn.trains.com/news/news-wire/2018/03/28-amtrak-to-stop-operating-special-trains-charter-moves

 

 

 

 

 

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Posted by n012944 on Wednesday, March 28, 2018 7:01 PM

Steve McDonough

This is the reaction you should expect from a former CEO of Northwest and Delta Airlines. 

 

 

What does Mr Anderson's former employeers have to do with this?  Under Mr Anderson's leadership, Delta operated a sucsessful charter business. The charter side even has its own aircraft fleet.

https://news.delta.com/delta-carries-cleveland-cavaliers-nba-championship

"What an exciting end to the NBA season, and how fitting that our Delta employees got to carry the champion Cavaliers on the final leg of their journey home," said Bill Wernecke, Managing Director – Charter Operations. "Our entire operating team deser​​ves congratulations for safely and successfully executing every day over the entire season." 

The Cavaliers flew home on one of Delta's newly retrofitted 757-200s, which was first introduced in January and is one of 11 new 757-200 aircraft reconfigured to replace the current charter fleet of A319s. The redesigned interiors feature 72 business class seats with bin-less overhead spacing, an oversized lavatory, sleeper seats, high-speed WiFi and club seating. 

Delta transported 11 of 16 participating teams into postseason competition, including the final four: Cleveland, Golden State, Oklahoma City Thunder and Toronto Raptors. 

Additionally, Delta carried the Atlanta Hawks, Los Angeles Clippers, San Antonio Spurs, Charlotte Hornets, Portland Trail Blazers, Indiana Pacers and Memphis Grizzlies. Delta has carried the past three NBA Champions and nine of the last 17 title winners.

During the regular season and playoffs, Delta generated more than $65M in revenue and operated more than 1,700 flights."

 

Maybe Amtrak's charter buisness was not as profitable as some foamers would like to believe.

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Posted by MidlandMike on Wednesday, March 28, 2018 7:54 PM

I think Amtrak is under duress to show it is lean, and they are sacraficing something that is not part of their core business.

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Posted by V.Payne on Wednesday, March 28, 2018 8:41 PM

Do our DC protectors not realize that a line of business that has significant fixed costs, requiring general fund investments, will always fail to "capture fully allocated profitable margins" just as highways never recover anywhere near their total costs relative to incremental revenue, slurping up instead taxes on the use of locally financed roads to fund highways. There is almost always additional overhead to be allocated. Only if the market subsidies where eliminated, such that the clearing price rose, could profit ever be had. 

By engineering analysis (Davis Equation and diesel efficiency) additional cars might use another 0.2 gallons per mile, or $0.40 per mile, but are charged $2.90 per mile plus extra fees, but yet no profit?

Also Federal Law requires Amtrak to operate charters, who is the master?

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Posted by BaltACD on Wednesday, March 28, 2018 9:06 PM

If we have learned anything from the Washington perspective in the past year and a quarter - Laws only apply to the little people.

         

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Posted by CMStPnP on Thursday, March 29, 2018 12:28 AM

Prior to the new CEO, Amtrak was running around telling everyone that Special Moves and Charters actually made money.   Most recently with the Denver Ski Train trips to Winter Park.   Even advertising for private car charters in it's timetables and online website.      So I wonder what changed with Amtrak Accounting.    Does look like an Executive reversal made for superficial reasons vs. business reasons.

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Posted by SD70Dude on Thursday, March 29, 2018 12:44 AM

BaltACD

If we have learned anything from the Washington perspective in the past year and a quarter - Laws only apply to the little people.

And only little people pay taxes!

Greetings from Alberta

-an Articulate Malcontent

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Posted by Brian Schmidt on Thursday, March 29, 2018 8:57 AM

Private-car groups respond to Amtrak plans on charters, excursions

WASHINGTON — The two organizations representing the private-car industry say they’re doing their part to communicate with Amtrak the importance of their industry. A Wednesday afternoon memo from the American Association of Private Railro...

http://trn.trains.com/news/news-wire/2018/03/29-private-car-groups-respond-to-amtrak-plans-on-charters-excursions

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Posted by CandOforprogress2 on Thursday, March 29, 2018 9:29 AM

This is in responce to VA Transpoprtation Museum to Force Norfolk Southern to run Steam using Amtrak Powers.

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Posted by YoHo1975 on Thursday, March 29, 2018 10:47 AM
I can't speak to the profitability, I have a hard time imagining it's profitable to tack on varnish at intermediate stations. And I'm assuming any issues with excursions and the like has more to do with equipment and crews. I can fully believe given Amtrak's woes that those events could impact regular customers. Having said that, for something like the Huntington train referenced. If all the cars are private...and presumably NOT staffed by Amtrak, couldn't CSX pull the train? They don't have a set of F-units as NS does, but I'd have to imagine that Amtrak isn't the only game in town for something like this.
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Posted by BaltACD on Thursday, March 29, 2018 11:25 AM

YoHo1975
I can't speak to the profitability, I have a hard time imagining it's profitable to tack on varnish at intermediate stations. And I'm assuming any issues with excursions and the like has more to do with equipment and crews. I can fully believe given Amtrak's woes that those events could impact regular customers. Having said that, for something like the Huntington train referenced. If all the cars are private...and presumably NOT staffed by Amtrak, couldn't CSX pull the train? They don't have a set of F-units as NS does, but I'd have to imagine that Amtrak isn't the only game in town for something like this.

CSX doesn't and never has had the desire to run special PASSENGER trains.

         

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Posted by zugmann on Thursday, March 29, 2018 11:32 AM

BaltACD
CSX doesn't and never has had the desire to run special PASSENGER trains.

Give 'em a kick!

 The opinions expressed here represent my own and not those of my employer or any other railroad, company, or person.

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Posted by V.Payne on Thursday, March 29, 2018 12:59 PM

We the people said:

Special Passenger Trains

Pub. L. 110–432, div. B, title II, §216, Oct. 16, 2008, 122 Stat. 4930, provided that: "Amtrak is encouraged to increase the operation of special trains funded by, or in partnership with, private sector operators through competitive contracting to minimize the need for Federal subsidies. Amtrak shall utilize the provisions of section 24308 of title 49, United States Code, when necessary to obtain access to facilities, train and engine crews, or services of a rail carrier or regional transportation authority that are required to operate such trains."

http://uscode.house.gov/statviewer.htm?volume=122&page=4930

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Posted by Deggesty on Thursday, March 29, 2018 1:10 PM

V.Payne

We the people said:

Special Passenger Trains

Pub. L. 110–432, div. B, title II, §216, Oct. 16, 2008, 122 Stat. 4930, provided that: "Amtrak is encouraged to increase the operation of special trains funded by, or in partnership with, private sector operators through competitive contracting to minimize the need for Federal subsidies. Amtrak shall utilize the provisions of section 24308 of title 49, United States Code, when necessary to obtain access to facilities, train and engine crews, or services of a rail carrier or regional transportation authority that are required to operate such trains."

http://uscode.house.gov/statviewer.htm?volume=122&page=4930

 

Perhaps no one today with authority is aware of this?

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Posted by charlie hebdo on Thursday, March 29, 2018 2:05 PM

Deggesty

 

 
V.Payne

We the people said:

Special Passenger Trains

Pub. L. 110–432, div. B, title II, §216, Oct. 16, 2008, 122 Stat. 4930, provided that: "Amtrak is encouraged to increase the operation of special trains funded by, or in partnership with, private sector operators through competitive contracting to minimize the need for Federal subsidies. Amtrak shall utilize the provisions of section 24308 of title 49, United States Code, when necessary to obtain access to facilities, train and engine crews, or services of a rail carrier or regional transportation authority that are required to operate such trains."

http://uscode.house.gov/statviewer.htm?volume=122&page=4930

 

 

 

Perhaps no one today with authority is aware of this?

 

 

The operative word is "encouraged" as opposed to mandated or required.  Careful reading is essential, guys. 

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Posted by CMStPnP on Thursday, March 29, 2018 2:23 PM

BaltACD
CSX doesn't and never has had the desire to run special PASSENGER trains.

Visions of the former privitized Auto-Train (and problems with getting paid) still dance in their heads (lol)........then of course there was the Amtrak Floridian which was derailment prone after the addition of those huge six axle F45P.....whatevers.   Followed by the inevitable...."Whats wrong with their track maintenence?"  questions.  

I can imagine after that history the CEO of the predecessor railroad of CSX probably had a drawer full of prescriptions.

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Posted by V.Payne on Thursday, March 29, 2018 3:50 PM

No they shall... it is elsewhere in the Goals section of the CFR. The question for the OIG is are they using their best business judgement when trying to manage a business using fully allocated costs, the answer is in most business textbooks.

It would be intersting if the State of WV just says fine, we are requesting Amtrak operate the New River train through their authority.

§24101. Findings, mission, and goals

(a) Findings.—(1) Public convenience and necessity require that Amtrak, to the extent its budget allows, provide modern, cost-efficient, and energy-efficient intercity rail passenger transportation between crowded urban areas and in other areas of the United States.

(2) Rail passenger transportation can help alleviate overcrowding of airways and airports and on highways.

(3) A traveler in the United States should have the greatest possible choice of transportation most convenient to the needs of the traveler.

(4) A greater degree of cooperation is necessary among Amtrak, other rail carriers, State, regional, and local governments, the private sector, labor organizations, and suppliers of services and equipment to Amtrak to achieve a performance level sufficient to justify expending public money.

(5) Modern and efficient commuter rail passenger transportation is important to the viability and well-being of major urban areas and to the energy conservation and self-sufficiency goals of the United States.

(6) As a rail passenger transportation entity, Amtrak should be available to operate commuter rail passenger transportation through its subsidiary, Amtrak Commuter, under contract with commuter authorities that do not provide the transportation themselves as part of the governmental function of the State.

(7) The Northeast Corridor is a valuable resource of the United States used by intercity and commuter rail passenger transportation and freight transportation.

(8) Greater coordination between intercity and commuter rail passenger transportation is required.

(b) Mission.—The mission of Amtrak is to provide efficient and effective intercity passenger rail mobility consisting of high quality service that is trip-time competitive with other intercity travel options and that is consistent with the goals set forth in subsection (c).

(c) Goals.—Amtrak shall

(1) use its best business judgment in acting to minimize United States Government subsidies, including—

(A) increasing fares;

(B) increasing revenue from the transportation of mail and express;

(C) reducing losses on food service;

(D) improving its contracts with operating rail carriers;

(E) reducing management costs; and

(F) increasing employee productivity;


(2) minimize Government subsidies by encouraging State, regional, and local governments and the private sector, separately or in combination, to share the cost of providing rail passenger transportation, including the cost of operating facilities;

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Posted by PNWRMNM on Thursday, March 29, 2018 5:00 PM

Nothing here requires ATK to operate excursions or make their trains available to private cars.

In fact, they are prohibited from doing so of it is not profitable.

 

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Posted by PJS1 on Thursday, March 29, 2018 7:02 PM

PNWRMNM
 Nothing here requires ATK to operate excursions or make their trains available to private cars.

In fact, they are prohibited from doing so of it is not profitable. 

In FY16 the NEC Special Trains had an operating loss of $1.2 million.  In FY15 they had an operating loss of $5.5 million.
 
The non-NEC Special Trains, which presumably cover some of the trains referenced in the article, had an operating loss of $100,000 in FY16.  In FY15 the operating loss was $400,000.
 
In FY17 the NEC Special Trains had an Adjusted Operating Loss of $25.6 million, and the non-NEC Special Trains had an operating loss of $11.7 million. 

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Posted by V.Payne on Thursday, March 29, 2018 8:43 PM

This would yet again be a fully allocated fiction number, as their release claims they do not "capture fully allocated profitable margins". Amtrak requires massive fixed capital investment from the general fund, just as highways require taxing the use of locally funded roads, even my driveway or a parking lot, then spending the money far in excess of the gas taxes collected on those same highways.

I currently work for a large multi-national manufacturer. From first hand experience I know that product lines are only evaluated by their selling price relative to what is known as a delivered cost that completely excludes any fixed administration costs or even the sunk capital of the factory and existing tooling itself, then the best contributer is picked relative to the desired market reach and quantity. This is how real consumer businesses operate, none of this fully allocated theater.

Once you start trying to allocate fixed costs nothing can meet that criteria, not even Acela (so the NEC overhead is not treated the same, for example National Network track access is a expense, but NEC track is capital), as any line of business that brings in more revenue gets more allocation of cost. I believe this misguided idea started with an FTA ranking criteria in the mid-90s, which was only supposed to make transit agencies try to control fixed admininstration (bloat) costs by having to report it fully allocated.

What is really annoying me is I can see this same misguided criteria being used to say tomorrow that nothing beyond fiberglass bus-seat coach class will be offered as everything else doesn't "capture fully allocated profitable margins" all while we the people keep providing Amtrak with funds to prop up the NEC.

I believe the way to stop this is to file a USDOT OIG request letter with plenty of information to get them started questioning the FRA and the Amtrak OIG.

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Posted by PNWRMNM on Thursday, March 29, 2018 9:21 PM

ATK does not cover all of its costs. That is why it always needs money from Congress. No need for detailed accounting to figure that out

Most ATK services do not cover even their short run variable costs, and ATK seems to do all possible to confuse anyone trying to figure out what it costs them to do anything.

JPS1 seems both able and willing to read their financials and understand them. I am probably able but am certainly not willing since I believe ATK is a total waste, and a thief of valuable freight capacity.

 

 

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Posted by oltmannd on Thursday, March 29, 2018 9:28 PM

Maybe this belongs under "steam" but many of the mainline steam excursions are operated as Amtrak Specials.  That was the route the 611 gang were going to take since NS quit the excursion business last year.

 

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Posted by CMStPnP on Thursday, March 29, 2018 10:45 PM

JPS1
In FY16 the NEC Special Trains had an operating loss of $1.2 million.  In FY15 they had an operating loss of $5.5 million.   The non-NEC Special Trains, which presumably cover some of the trains referenced in the article, had an operating loss of $100,000 in FY16.  In FY15 the operating loss was $400,000.   In FY17 the NEC Special Trains had an Adjusted Operating Loss of $25.6 million, and the non-NEC Special Trains had an operating loss of $11.7 million. 

Amtrak is the only one in the Special Passenger Trains business, which means they can charge whatever they want for the service as they have no competitors.

How in the hell do you lose money in the Special Trains market space? (lol)

Very telling of Amtrak and it's management, in my opinion.    Just like their idiotic approach to LD trains being a public service and so have to be marketed exclusively to be affordable to everyone and stop at every little po-dunk town they possibly can.   

I remember after Amtrak took over the national network from the private railways the restricted stops in the timetables.    The flag stops were in there for maintaining a decent average speed.    There were flag stops in the national timetable on almost every major route.........now look and see if you can find more than a handfull...........most LD routes are glorified milk runs.

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Posted by V.Payne on Friday, March 30, 2018 9:52 AM

"In FY17 the NEC Special Trains had an Adjusted Operating Loss of $25.6 million, and the non-NEC Special Trains had an operating loss of $11.7 million."

That is somewhat suspicious, as in the monthly reports those lines are "NEC/Non-NEC Special Trains & Adjustments" but there are no adjustments noted in the FY17 numbers. Did they just roll everything together and forget to note the inclusion of adjustments?

Also, take for example in the FY19 Grant Request, they have a large bolded column title for Short-term Avoidable Profit or Loss, but then when you look at Note #14, it says "Amtrak financials do not currently define short-term avoidable profit or loss, so fully-allocated profit or loss is reported." Then why is the bold column label short-term?

I hope this makes the point.

 

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Posted by JL Chicago on Friday, March 30, 2018 9:59 AM
I'm s supporter of Anderson. Delta is widely considered in the airline industry as the best US based global airline for both customer service and financial results. Amtrak's problems are the result of years of mismanagement for failing to focus on its fare paying customers. Halting a train full of hundreds of customers for 30+ minutes for the benefit of a small group of people in a private car strikes me as elitist.
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Posted by V.Payne on Friday, March 30, 2018 10:46 AM

This gets a lot more than that question, which is really a lack of procedures problem, touching on Amtrak choosing numbers at will to drop service to the public (with no transparency) as they have been doing recently with checked baggage and Starlight lounge discontinuances, along with what would be a refusal to use their statuatory authority to gain access to the rail network for special trains, even though Congress directed them to do so. 

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Posted by Dakguy201 on Friday, March 30, 2018 10:59 AM

JL Chicago
I'm s supporter of Anderson. Delta is widely considered in the airline industry as the best US based global airline for both customer service and financial results. Amtrak's problems are the result of years of mismanagement for failing to focus on its fare paying customers. Halting a train full of hundreds of customers for 30+ minutes for the benefit of a small group of people in a private car strikes me as elitist.
 

 
Yet Delta maintains a large charter fleet -- everything from small business jets to various Boeing and AirBus models.  I believe they are the leading supplier of air service to professional sports teams. 
 
I am confused regarding this announcement.  Does the new policy only apply to special trains, or is it also applicable to private cars being attached to regularly scheduled Amtrak services?
 
 
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Posted by PJS1 on Friday, March 30, 2018 11:37 AM

V.Payne

That is somewhat suspicious, as in the monthly reports those lines are "NEC/Non-NEC Special Trains & Adjustments" but there are no adjustments noted in the FY17 numbers. Did they just roll everything together and forget to note the inclusion of adjustments? 

If you believe Amtrak's cost accounting procedures are not proper, you are free to submit a Freedom of Information Act request to get the accounting records that would support or refute your hunch.  You will have to know what documents to ask for since Amtrak is not required by law to produce any special documents to respond to your request. 

If you believe Amtrak is not complying with relevant laws, you can lodge a complaint with the Inspector General as well as your Congressional Representatives.

Good luck!

Rio Grande Valley, CFI,CFII

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