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News Wire: Amtrak workers protest possible job cuts from food changes

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Posted by Brian Schmidt on Thursday, October 11, 2018 9:13 AM

NEW YORK — Amtrak workers and union leaders staged a protest outside Penn Station on Wednesday, saying the company is preparing to lay off up to 1,700 workers by outsourcing its food services. The New York Post reported an estimated 100 protest...

http://trn.trains.com/news/news-wire/2018/10/11-amtrak-workers-protest-possible-job-cuts-from-food-changes

Brian Schmidt, Editor, Classic Trains magazine

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Posted by NKP guy on Friday, October 12, 2018 7:51 PM

   I'm sure it's been proven many times in business that austerity and service cuts are the clear pathway to profitability.  

   Mr. Anderson must be a very wise man, indeed.  

   It makes me wonder why no other Amtrak presidents in almost 50 years were farsighted enough to employ this sure-fire technique.

   Profitability, to paraphrase Mr. Hoover, is just around the corner.  Right?

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Posted by Deggesty on Friday, October 12, 2018 8:03 PM

I plan to ride the Cardinal to Washington the next time I go east. As of today, it still has a diner.

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Posted by BaltACD on Friday, October 12, 2018 8:43 PM

NKP guy
   I'm sure it's been proven many times in business that austerity and service cuts are the clear pathway to profitability.  

   Mr. Anderson must be a very wise man, indeed.  

   It makes me wonder why no other Amtrak presidents in almost 50 years were farsighted enough to employ this sure-fire technique.

   Profitability, to paraphrase Mr. Hoover, is just around the corner.  Right?

Just like Sears is cutting it's way to profitability - or oblivion!

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Posted by Anonymous on Saturday, October 13, 2018 9:47 AM

NKP guy
It makes me wonder why no other Amtrak presidents in almost 50 years were farsighted enough to employ this sure-fire technique.

Perhaps all others dodged the problem?

In the Passenger Rail Reform & Investment Act of 2015 the following is required: “Beginning on the date that is five years after the date of enactment of [PRRIA], no Federal funds may be used to cover any operating loss associated with providing food and beverage service on a route operated by Amtrak.”

The same law requires that no Amtrak employee lose his or her employment due to implementation of this order.

The five years are up on December 30, 2020. So Mr. Anderson can't dodge the requirement anymore. The devil takes the hindmost.
Regards, Volker

 

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Posted by PJS1 on Saturday, October 13, 2018 11:55 AM

NKP guy

I'm sure it's been proven many times in business that austerity and service cuts are the clear pathway to profitability.  

Successful businesses focus on markets where there is an arm’s length demand for their outputs.  And where people are willing to pay enough to cover the costs of production, delivery, etc. as well as provide a reasonable return for the shareholders.

Cost control is important.  But only if a company's products and services are tuned to market demand.  Sometimes, for a variety of reasons, management realizes that there is no real demand for a product or service.  And they drop them.  Happens all the time.  One need look no further than GE to see it in action.

If Amtrak were managed like a real business, management would drop the long-distance trains in a heartbeat.  Without them, it would have realized an overall operating profit in FY17. 

According to Amtrak's IG, more than 96 percent of Amtrak's food and beverage losses are attributable to the long-distance trains.  Get rid of them, and cuts to food and beverage services would not be an issue. 

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Posted by PJS1 on Saturday, October 13, 2018 12:20 PM

BaltACD
 Just like Sears is cutting it's way to profitability - or oblivion! 

Sears is an investor owned business.  Management has made a lot of mistakes.  It probably will file for bankruptcy in a week or so.  Ultimately, the shareholders and bondholders will wear the consequences. 

Markets have an effective way of carving out organizations that fail to deliver what customers want.  It is the nature of the game.  Sear’s problems started long before any so-call austerity moves.  Moreover, it does not even begin to resemble Amtrak.

Unlike a private business, when Amtrak’s management makes a bad decision(s), the consequences fall on the taxpayers.  As of the end of FY17 Amtrak had hung the American taxpayers with approximately $34.7 billion in losses before adjustment for inflation.  Restated in 2009 constant dollars, which is a benchmark year used by the Congressional Budget Office, the losses are north of $40 billion.  

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Posted by CMStPnP on Saturday, October 13, 2018 2:06 PM

BaltACD
Just like Sears is cutting it's way to profitability - or oblivion!

Hey a money saving tip for you.    If you need a new or nearly new appliance for cheap, check out online - Google:   "Sears Outlet Store".     They have some 50% of deals on just minor cosmetically damaged appliances.    They are not all Sears brands either.    Kitchen Aide, Maytag, Whirlpool, LG, Samsung.    It's like the old Railroad Salvage Stores they used to have around the country.

So Sears still has one good concept left at least.   

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Posted by BaltACD on Saturday, October 13, 2018 3:16 PM

CMStPnP
 
BaltACD
Just like Sears is cutting it's way to profitability - or oblivion! 

Hey a money saving tip for you.    If you need a new or nearly new appliance for cheap, check out online - Google:   "Sears Outlet Store".     They have some 50% of deals on just minor cosmetically damaged appliances.    They are not all Sears brands either.    Kitchen Aide, Maytag, Whirlpool, LG, Samsung.    It's like the old Railroad Salvage Stores they used to have around the country.

So Sears still has one good concept left at least. 

Have had Craftsman tools for over 25 years.  Have had some replaced by the former - you break it we replace it guarantee - When Sears still owned the Craftsman name - they no longer do.  I think the only Sears Brand that is still owned by Sears is Kenmore and they are trying to sell it.

There are still two Sears stores in my area - they are looking threadbare and run down.

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Posted by NKP guy on Saturday, October 13, 2018 7:35 PM

PJS1
If Amtrak were managed like a real business

   Let's get real:  Amtrak is not a real business; at least not as you'd define it.  Neither is the Postal Service; both provide a service the American public has shown repeatedly that it wants and is willing to subsidize to retain.  Amtrak has no shareholders (stakeholders, certainly), no need to inflate stock prices so that top managers get big bonuses, no shareholder meetings, no need to worry that a hedgefund will buy it and then liquidate it for their own private profit.  It just needs to serve the American public that is paying for it.  Everywhere. 

PJS1
more than 96 percent of Amtrak's food and beverage losses are attributable to the long-distance trains.  Get rid of them, and cuts to food and beverage services would not be an issue. 

   I think the incontroverible point has been made on this forum a number of times before you joined us:  Without long distance trains there will shortly be no Amtrak. Period.  Amtrak won't exisit politically or economically without support in both Houses of Congress, and the several coastal states don't have enough members of Congress to shove down the NEC down our throats without a suitable sweetener.  After all, what would be in such a NEC Amtrak for us?

   The subsidy you mention?  Over 50 years that amount doesn't seem very much to me, and in fact it hasn't been.  What has been spent since 1971 on...(here insert the gov't program of your choice)?  What percent of the federal debt can be attributed to Amtrak?  I'll bet not as much as continual war and even more tax cuts for those who own private aircraft.

   As for the analogy that businesses (see point #1 above) drop unprofitable parts of their business, decent food on long distance trips is part of the cost of doing business.  When having something nice to eat on long distance trains is lost, ridership will suffer in proportion.  Then we will once again see the strategy of the New York Central (among others): Few people are riding our LD trains (since we got rid of food, in this case), so let's drop them.  What the NYC did was to have the LD train from Chicago arrive in Albany about an hour after the connecting train from  there departed for New York City.  Do you remember that?  I sure do.  Was that because of profitability?

   Amtrak was created, devil's bargain though it may have been, to serve the portion of the public that wants or needs to travel by train, long or short distance intercity trains.  The logistics of LD trains demands that decent food service be available on trains, just as toilets are..  It seems to me that Amtrak "loses money" on toilets in their cars.  Seriously.  How much money could be saved if toilets were eliminated from LD trains, to say nothing of NEC trains?  Should passengers be charged for using toilets?  Why on earth not?  How is needing to pee, or such, different from wanting something to eat?  Frankly, if the goal is to end LD trains for whatever misguided reason, why not simply elimate toilets?  That will achieve the desired effect even faster, maybe, than dropping the age-old experience of having a nice meal in the dining car.

   It's also not lost on me that the people, most of them probably men, and likely men of color, who have given their all to Amtrak for years, and who have half-way decent, more-or-less-middle class jobs (thanks to their unions) with potential pension benefits, will be summarily dismissed from their jobs and lifestyle.  To paraphrase Joe Stalin: The death of one man is a tragedy; the deaths of 10,000 is a statistic.  So it is for 1,700 faithful Amtrak employees, right?  A statistic made necessary so that the NEC can live?  Is that it?  Where is the proof to support the contention that miserable food service on LD trains will lead to a glorious future for patrons of the NEC?  

Lastly, to see "rail fans" advocating for the end of  (brand new!) dining cars and decent food service on LD trains (why not on NEC trains?) is quite dismaying, indeed.

 

 

 

 

 

 

 

 

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Posted by Deggesty on Saturday, October 13, 2018 8:05 PM

Sears is gone from my area. Ten or so years ago, there were three--then there were two--then there was one--and now there is none. 

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Posted by PJS1 on Saturday, October 13, 2018 9:03 PM

NKP guy
 Amtrak is not a real business; at least not as you'd define it. 

Amtrak won't exisit politically or economically without support in both Houses of Congress, and the several coastal states don't have enough members of Congress to shove down the NEC down our throats without a suitable sweetener.  

At its formation Amtrak was expected to earn a profit within a set timeframe.  When that proved to be impossible, the governance language was changed to say that it should be run like a business.  Running a commercial enterprise like a business means covering its costs.  Amtrak has not even come close. 

The American people wanted Amtrak?  Or was it an influential albeit fanatical passenger train lobby that helped push the legislation through the Congress.  If the American people had wanted passenger trains, especially long-distance trains, how come they deserted them in mass beginning in the 1950s?

Amtrak is a stock corporation.  All the preferred shares are owned by the U.S. Secretary of Transportation for the benefit of the federal government.  The common stock, which is worthless, is owned by one or more of the investor own railroads or successors. 

Amtrak carries people from one point to another for a fare.  That is a generally accepted definition of a commercial enterprise or business.  Moreover, it accounted for as if it were a public corporation, i.e. Generally Accepted Accounting Principles (GAAP) as opposed to fund accounting. 

The notion that Congress would cut off all transitory funding for Amtrak or a successor operator if the long-distance trains were to be discontinued is untested.

Less than one percent of intercity traveler’s ride Amtrak’s long-distance trains.  Only 14 percent of Amtrak’s system riders take a long-distance train, and 85 percent of them ride coach.  Elimination of the dining cars probably would go unnoticed by most of the coach passengers.  In any case, there is no cogent argument for the taxpayers to subsidize the meals of long-distance trains riders that they are unwilling to pay for.

No one is suggesting the elimination of all food service from Amtrak's trains.  The proposal is to scale the food and beverage service to the market and price it to cover its costs.  This is probably the idea behind outsourcing some or all of it.  

In FY17 227,000 passengers were ticketed to or from a State Supported train to a long-distance train.  This was 1.5 percent of the State Supported passengers or 4.8 percent of the long-distance passengers.  Just 27,000 passengers were ticketed to or from a NEC train to a long-distance train.  This was 22/100s of one percent of the NEC passengers or 57/100s of one percent of the NEC passengers.  In other words, the long-distance trains could go away and the impact on the State Supported and NEC trains would be negligible.  

The NEC, which had an operating profit in FY17 of $472, as opposed to an operating loss of $500 million for the long-distance trains, has been covering its operating expenses and a significant portion of its capital expenses for more than five years.  If the long-distance trains were terminated, in time most of the money lost on them could be transferred to the NEC. 

Rolling forward the NEC probably could survive without any Congressional support, just like Brightline and hopefully Texas Central Railway.  To the extent that it requires Congressional support, it is possible that trade-offs could be implemented for those states that lose their spartan long distance routes, i.e. an enhanced Essential Air Service Program, connecting corridor buses where workable, etc.  In the case of Texas, where I live, most of the Congressional delegation probably don’t care about Amtrak for a good reason.  Most of their constituents don’t even know Amtrak exists.

The amount of money lost by Amtrak is sunk.  Moreover, the amount of money spent on other government programs is irrelevant.  The question is whether additional public monies should be spent to support passenger rail and, if so, where?

No where in your post do I see any supporting data.  I have no idea what you did or do in your work life, but it does not appear that you have had any experience in running a business or being part of a large business organization.  

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Posted by NKP guy on Saturday, October 13, 2018 9:14 PM

PJS1
I have no idea what you did or do in your work life, but it does not appear that you have had any experience in running a business or being part of a large business organization. 

[quote user="PJS1"]

   I have a lifetime of experience as a taxpayer, customer, and railfan.  Those are my credentials.  

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Posted by BaltACD on Saturday, October 13, 2018 10:04 PM

[quote user="NKP guy"] 

PJS1
I have no idea what you did or do in your work life, but it does not appear that you have had any experience in running a business or being part of a large business organization.  

PJS1
 

   I have a lifetime of experience as a taxpayer, customer, and railfan.  Those are my credentials.  

At its formation - Amtrak was expected to be history in five years.  That was the business plan of its founders. As such traditional business goals never applied to Amtrak and with it being captive to the whims of Congress they still don't apply.

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Posted by PJS1 on Saturday, October 13, 2018 10:23 PM

BaltACD
 At its formation - Amtrak was expected to be history in five years.  That was the business plan of its founders. As such traditional business goals never applied to Amtrak and with it being captive to the whims of Congress they still don't apply. 

This is a common assumption.  However, I have never seen any independently verifiable evidence that the founders of Amtrak expected it to fail and be gone within five years of its founding.

Unless the decision makers wrote down their expectations, one would have needed to be part of the decision making processes, heard them say that and written it down for posterity.  Or been mind reader see into the minds of the decision makers. 

Everything that I have heard or seen about Amtrak's life expectancy is based on hearsay that has traveled widely.  

From its mission to its organizational structure, Amtrak has the markings of a business or commercial enterprise.  It has been a financial failure, to be sure, but that does not change the nature of its footprint.    

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Posted by CMStPnP on Saturday, October 13, 2018 10:43 PM

PJS1
At its formation Amtrak was expected to earn a profit within a set timeframe.  When that proved to be impossible, the governance language was changed to say that it should be run like a business.  Running a commercial enterprise like a business means covering its costs.  Amtrak has not even come close. 

Actually your mistaken there, BaltACD is correct, that verbage was mostly a political front.     Amtrak was a compromise between the Nixon Administration and the Democrats.    The Nixon administration didn't give the concept more than 5-6 years based on railroad CEO input and thought the Feds would give up.   That is part of the reason they tried a rehab of the passenger equipment vs wholesale replacement and why they scrapped or refused large parts of the fleet.    Also, why they bought FP-45's for locomotives as they continued the railroad philosophy that they could be used for freight upon Amtraks failure (thats why Santa Fe and Milwaukee Road bought them as well prior to Amtrak, they knew in a matter of years they would be freight only units).    I believe SP bought SDP-45's with steam generators for the same reason, if you look at the SDP-45's closely, they were designed more for freight service than passenger service.

Amtrak's first 10-15 years was band aid after band aid waiting for Congress to give in and cancel the program, which it never did.    Also, part of the 40 Billion in subsidy you cite was to restore track and signal infrastructure not totally related to Amtrak back to operational condition from decades of deferred maintence.   As well as rehab depots.    Not all of that money went direct to passenger train operations.

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Posted by CMStPnP on Saturday, October 13, 2018 10:54 PM

PJS1
Unless the decision makers wrote down their expectations, one would have needed to be part of the decision making processes, heard them say that and written it down for posterity.  Or been mind reader see into the minds of the decision makers. 

Or just do the research and see what the Nixon Administration and later the Ford Administration officials stated about Amtrak.    Pretty sure you can get that from the Nixon Library.

https://www.citylab.com/transportation/2015/02/11-historical-maps-and-charts-that-explain-the-birth-of-amtrak/386084/

Then of course you have the words of Nixon himself which hardly endorse the system or program.........note the very reluctant verbage at the end in the last paragraph...

http://www.presidency.ucsb.edu/ws/?pid=4031

 

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Posted by BaltACD on Saturday, October 13, 2018 11:14 PM

PJS1
 
BaltACD
 At its formation - Amtrak was expected to be history in five years.  That was the business plan of its founders. As such traditional business goals never applied to Amtrak and with it being captive to the whims of Congress they still don't apply.  

This is a common assumption.  However, I have never seen any independently verifiable evidence that the founders of Amtrak expected it to fail and be gone within five years of its founding.

Unless the decision makers wrote down their expectations, one would have needed to be part of the decision making processes, heard them say that and written it down for posterity.  Or been mind reader see into the minds of the decision makers. 

Everything that I have heard or seen about Amtrak's life expectancy is based on hearsay that has traveled widely.  

From its mission to its organizational structure, Amtrak has the markings of a business or commercial enterprise.  It has been a financial failure, to be sure, but that does not change the nature of its footprint.    

If you think politicians write down verifyable data about their REAL INTENTIONS, I have a Trans-Oceanic Bridge to sell you.  Amtrak was created to fail and thus give the politicans cover - the fact that it has continued to operate for 47 years is a testament to Amtrak leadership and work force.

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Posted by PJS1 on Sunday, October 14, 2018 7:18 AM

CMStPnP
 Or just do the research and see what the Nixon Administration and later the Ford Administration officials stated about Amtrak.    Pretty sure you can get that from the Nixon Library.

https://www.citylab.com/transportation/2015/02/11-historical-maps-and-charts-that-explain-the-birth-of-amtrak/386084/

Then of course you have the words of Nixon himself which hardly endorse the system or program.........note the very reluctant verbage at the end in the last paragraph...

http://www.presidency.ucsb.edu/ws/?pid=4031 

 

Neither article identifies anyone associated with Amtrak's formation stating that it would be history in five years.  Reading between the lines, which is speculation, it is reasonable to conclude that one or more of the decisions makers had doubts about its long-term viability, but that is a far cry from explicit evidence that the founders stated the intent was for Amtrak to be history in five years.

The Jaffe piece is mostly about maps, although the topical sentence in the first paragraph contains this assertion: "no one thought Amtrak was long for this world."  It is an unsupported opinion.  Who is "no one"?  

Buying FP-45s appears to have been part of a contingency plan, which is what most businesses do.  It could have failed.  But that is much different than saying the founders knew that it would fail.   If there is any verifiable evidence that the people who founded Amtrak believed that it would be history in five years, no one has presented it.   

Over the years I have sought the names, as well as verifiable evidence, of those who supposedly claimed that Amtrak would be history in five years.  To date I have been unsuccessful. 

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Posted by Anonymous on Sunday, October 14, 2018 9:42 AM

CMStPnP
Also, why they bought FP-45's for locomotives as they continued the railroad philosophy that they could be used for freight upon Amtraks failure (thats why Santa Fe and Milwaukee Road bought them as well prior to Amtrak, they knew in a matter of years they would be freight only units).

Perhaps I misunderstand you but Amtrak never owned FP45s. Only ATSF (9) and Milwaukee Road (5) ordered them. ATSF bought them in 1967 for their premier passenger trains as they didn't like the SDP45's road switcher appearance. After Amtrak took over ATSF was able to use the FP45 as freight locomotive as it was a redesigned SD45 freight locomotive

Amtrak bought EMD SDP40F locomotives which were redesigned from the SD40-2. 

As others had good experiences with freight locomotive redesigns (SDP40, SDP45, FP45 etc.) as passenger locomotives went the same way. The locomotive was prepared for change to electrical HEP. Thus the steam generator was placed on a scid and easily removale. I doubt that one can take the SDP40F's easy convertability for freight service as indicator for planning for Amtrak's failure.

CMStPnP
I believe SP bought SDP-45's with steam generators for the same reason, if you look at the SDP-45's closely, they were designed more for freight service than passenger service.

The SDP45 was redesigned from the SD45 so it was originally designed for freight service. It was the only way for a manufacturer to build a small series (52) of passenger locomotives at reasonable costs through saving the high costs for a completely new design. 
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Posted by oltmannd on Monday, October 15, 2018 9:02 AM

Did anyone but me find the number 1700 rather outragous?  

Even if Amtrak was really good at food service, that's a lot of people.  

If it's not a core competancy, it should be open to oursourcing.

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Posted by PJS1 on Monday, October 15, 2018 9:45 AM

oltmannd
 Did anyone but me find the number 1700 rather outragous?  Even if Amtrak was really good at food service, that's a lot of people.  If it's not a core competancy, it should be open to oursourcing. 

Yes, 1,700 is outrageous.  Food service is not an Amtrak core competency.  It should be outsourced to someone for whom it is ther bread and butter.  Someone that has to compete for a contract; someone that will lose it in a heartbeat if they don’t deliver!

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Posted by zugmann on Monday, October 15, 2018 10:47 AM

PJS1
Someone that has to compete for a contract; someone that will lose it in a heartbeat if they don’t deliver!

Ok... who?

  

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Posted by charlie hebdo on Monday, October 15, 2018 4:09 PM

PJS1

 

 
BaltACD
 At its formation - Amtrak was expected to be history in five years.  That was the business plan of its founders. As such traditional business goals never applied to Amtrak and with it being captive to the whims of Congress they still don't apply. 

 

This is a common assumption.  However, I have never seen any independently verifiable evidence that the founders of Amtrak expected it to fail and be gone within five years of its founding.

Unless the decision makers wrote down their expectations, one would have needed to be part of the decision making processes, heard them say that and written it down for posterity.  Or been mind reader see into the minds of the decision makers. 

Everything that I have heard or seen about Amtrak's life expectancy is based on hearsay that has traveled widely.  

From its mission to its organizational structure, Amtrak has the markings of a business or commercial enterprise.  It has been a financial failure, to be sure, but that does not change the nature of its footprint.    

 

Myth or not is unclear.  I once read in Trains that one of Amtrak's original board from the BN (Menk or Budd) said later that Amtrak was supposed to last at most five years.  However, although I could not find that, I found another article mentioning the myth of Amtrak underpaying for rent.  This discusses why Amtrak pays for lawsuits that the freight rails should pay when sued over accidents.
https://www.nytimes.com/2004/10/15/us/amtrak-pays-millions-for-others-fatal-errors.html

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Posted by PJS1 on Monday, October 15, 2018 5:30 PM

zugmann
 PJS1 Someone that has to compete for a contract; someone that will lose it in a heartbeat if they don’t deliver! 

Ok... who? 

There are hundreds if not thousands of food service contractors in the United States that provide food and beverage services to organizations, i.e. airlines, hotels, hospitals, schools, universities, etc.  

Anderson could start by encouraging Linton Hopkins, as well as others, to bid on a contract to outsource Amtrak's food and beverage services.  Linton Hopkins provides some of the food and beverage services for Delta Airlines.    

The key to getting a good deal for Amtrak's food and beverage service is to open it to robust, competitive bidding, and make sure the contractor understands that if she does not perform, she will lose the contract.  

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Posted by BaltACD on Monday, October 15, 2018 6:53 PM

PJS1
 
zugmann
 PJS1 Someone that has to compete for a contract; someone that will lose it in a heartbeat if they don’t deliver! 

Ok... who?  

There are hundreds if not thousands of food service contractors in the United States that provide food and beverage services to organizations, i.e. airlines, hotels, hospitals, schools, universities, etc.  

Anderson could start by encouraging Linton Hopkins, as well as others, to bid on a contract to outsource Amtrak's food and beverage services.  Linton Hopkins provides some of the food and beverage services for Delta Airlines.    

The key to getting a good deal for Amtrak's food and beverage service is to open it to robust, competitive bidding, and make sure the contractor understands that if she does not perform, she will lose the contract.  

Robust bidding - dream on!  If bidders do the due dilegence, they will walk away in droves.  A organization with a recognizable name and menu won't be able to sell their recognizable products at the same price point as the do in their 'normal' operations and customers would rebel at the required price point.  Rather than destroy their reputation, they don't need the aggrevation.

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Posted by CMStPnP on Monday, October 15, 2018 7:30 PM

H-h-h-m-m-m-m, lots of hearsay out there....

 

In a speech in December 1970, Secretary of Transportation Volpe, asserted that 
Amtrak would be profitable.3 In February of 1971, he elaborated on that assertion, 
saying that Amtrak would break even within three years and be profitable thereafter.4 
However, this expectation was based on two assumptions: (1) that Amtrak would 
provide better service; and (2) that it would operate a reduced number of routes. 
Volpe claimed that “fast, clean, economical and safe trains” could attract enough 
riders to make a profit5; at the same time, he was drawing up a route system for 
Amtrak that was a great reduction from the extent of service being provided by 
railroad companies. But when he declared that Amtrak’s profitability would depend 
in part on a reduced number of routes, he did not mean simply Amtrak’s original 
route network; he said that, after Amtrak had been in operation for a few years, the 
unprofitable routes would be cut back to the point that their losses could be covered 
by the money earned on the profitable routes.

=====================================================================

He was followed by Representative Dan 
Kuykendall of Tennessee, another member of the Subcommittee on Transportation 
and Aeronautics: 
... if anyone asks, “Do you think that with the present equipment can this 
passenger corporation be profitable?” the answer is “absolutely not.” It cannot 
be profitable with the present equipment. But by starting with equipment like the 
Metroliner and going rapidly ahead into the really sophisticated equipment of the10 
future, it can be and will be a profitable operation. 
Representative Richard Ottinger of New York summed things up: 
[the corporation] will hopefully make a profit through its operations. 
Nevertheless, the corporation will be required to run passenger trains over some 
unprofitable routes when necessary in the public interest, so it is possible that 
this new program will have to be funded by the Congress on an annual basis ... 
Hopefully new developments in high speed rail technology will enable the11 
National Railroad Passenger Corporation to eventually become solvent ... 
The “pruned service” assumption was reflected in the remarks of Representative 
William Springer of Illinois, the ranking member of the Committee on Interstate and 
Foreign Commerce: 
It has become apparent that saving the entire nationwide network of passenger 
trains ... is impossible. Federal subsidies of astronomical proportions would be 
necessary to keep all those empty, long-haul trains operating ... There do remain 
areas of the country where rail service should be useful and economically sound 
at the same time. The example which usually comes to mind is the Northeast 
Corridor, but it is not the only place ... This will not, as I have already intimated, 
be a nationwide network as we have known it in the past. It will necessarily 
concentrate upon corridors of high density travel ... Although it is intended to be 
a corporation run for profit, the harsh realities indicate a massive infusion of12 
money from the Government to make it go. 

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

At the time of its creation, those Congressional and Administration leaders who 
forecasted Amtrak achieving profitability based that forecast on two pre-conditions: 
Federal investment to produce fast, safe trains and a cutback of the rail network so 
that the losses from unprofitable routes would be covered by the profits of profitable 
routes. Those arguing that these pre-conditions were never met point out that 
Amtrak’s train speeds and route mileage are virtually the same now as when it was 
created. 

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

 

  • Member since
    June 2009
  • From: Dallas, TX
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Posted by CMStPnP on Monday, October 15, 2018 7:41 PM

PJS1
There are hundreds if not thousands of food service contractors in the United States that provide food and beverage services to organizations, i.e. airlines, hotels, hospitals, schools, universities, etc.   Anderson could start by encouraging Linton Hopkins, as well as others, to bid on a contract to outsource Amtrak's food and beverage services.  Linton Hopkins provides some of the food and beverage services for Delta Airlines.     The key to getting a good deal for Amtrak's food and beverage service is to open it to robust, competitive bidding, and make sure the contractor understands that if she does not perform, she will lose the contract.  

I would like to see it happen, really.    Agree with Balt on this as well.   Count the number of meals served on the nationwide LD network on a daily basis and if you do the math correctly........tiny contract compared to say a Nationwide Network of Delta flights.    Your talking approx what say 4 maybe 5,000 daily meals (rough estimate) for all daily Amtrak LD trains?     What kind of price are you going to expect to get for that?    Further the packaging has to be different or the meals have to be supplied daily to each train.    Google and look up how long those airline meals last before they are thrown away generally.   3-4 days after they get on a catering truck and head out for delivery is pushing the expiration date.    

So I am pretty sure the Amtrak meals would need to be unique and apart from the airline stock and not enjoy the same economies of scale (pushing up their costs).   Logistics of not being at the airport (push up costs more).     

Though it would be really cool if Amtrak could take on stock at airport rail stations in a small experiment.   Still I think it would be cheaper than 1700 employees on the Amtrak benefit system.   Amtrak meals would need to last at least a week, IMHO.    Which means frozen not fresh.    Most airline meals are fresh and just refrigerated.   So slight difference there.    Last your asking the head of the Dining Car on an Amtrak train to decide what types of entrees to order so expect a lot of Chicken A'la King meals vs Beef Burginon.     So that would need to be another problem service wise to overcome.     How to estimate a selection broad enough while not going overboard on waste so that passengers had a choice.......and remember Airline meals are expensive per piece unless you have economies of scale or network.

  • Member since
    February 2016
  • From: Texas
  • 1,537 posts
Posted by PJS1 on Monday, October 15, 2018 8:31 PM

CMStPnP
I would like to see it happen, really. 

Presumably Anderson knows how to select an outsourced food and beverage supplier that would scale the product and service to Amtrak' needs.  

An army of people know why Amtrak's food and beverage services cannot be fixed.  Lets just keep on keeping on is their mantra. 

In time, however, innovative management will find a way to fix it, or it will go out of existence, and start-ups like Brightline, Texas Central Railway, etc. will take its place. 

Rio Grande Valley, CFI,CFII

  • Member since
    February 2016
  • From: Texas
  • 1,537 posts
Posted by PJS1 on Monday, October 15, 2018 8:39 PM

BaltACD
 Robust bidding - dream on!  If bidders do the due dilegence, they will walk away in droves.  A organization with a recognizable name and menu won't be able to sell their recognizable products at the same price point as the do in their 'normal' operations and customers would rebel at the required price point.  Rather than destroy their reputation, they don't need the aggrevation. 

Yep, the way forward is not to try anything new.  Just keep on keeping on. 

Maybe Anderson was brought on board to get Amtrak to think outside of the box.

The product would have to be scaled to meet Amtrak's needs.  A competent provider would be able to do that.  Presumably Anderson would not be stupid enought to award a contract to an inflexible provider.   

Rio Grande Valley, CFI,CFII

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