Amtrak on the Ropes? Article

[RudyRockvilleMD]

Bob Johnston mixes his opinions with facts in his article,”Amtrak on the Ropes,” in the September, 2005 Trains; this is not appropriate for an article unless it is an editorial.

He insinuated Secretary of Transportation Mineta was doing something wrong while he was flying around the country at taxpayer expense to present the administration’s views on [intercity] passenger rail service when in fact, he was doing his job.

He criticized the AARP for not supporting passenger train funding when, as he claimed, an increasing number of their rural members may not be able to drive, or purchase a car, or they cannot, or they will not fly. What facts does he have to support his claim? I will get back to this issue later. It seems to me the AARP, like many seniors’ organizations, has more important fi***o fry such as prescription drug costs, health insurance, Social Security, pensions, and the high cost of energy - just to name a few - rather than to preserve [intercity] passenger rail service. Add job security to that list, and even the public has the same more important concerns.

He asked why the government supports highways and air travel while the national passenger rail service is judged on whether or not it is profitable. Here are some answers.

The question is not whether intercity passenger rail service can, or ever, will be profitable, but how to reform it so it can survive. The demand that intercity passenger rail service should be profitable was dropped at least four years ago when the Amtrak Reform Commission concluded it would never be profitable.

In most markets more people fly rather than take the train because flying is frequently more convenient, faster, and sometimes less expensive on an out-of-pocket cost basis. Even more people drive than fly, or go by train in spite of the $3.00 per gallon - or more - cost of gas for their vans or their SUV’s.

Then again, airline passengers pay taxes on their tickets for domestic flights, security fees, and airport passenger facility fees. Motorists pay state and local gasoline taxes, highway tolls, and license fees. How much in the way of the same types of user fees or taxes that motorists or airline passengers pay do intercity rail passengers pay? Zilch; zero; zip; nada!

Bob Johnston claims Amtrak’s long-distance trains are relatively inexpensive to run compared to high speed corridor trains. Really! According to Amtrak’s FY’04 figures its long distance trains accounted for 75% of its direct operating losses while the Northeast Corridor contributed something to the bottom line. However, the cost of the Northeast Corridor’s infrastructure can be spread Amtrak’s many trains, and it is shared by the commuter operators who use it, so any one of Amtrak’s long distance trains may be more expensive to run because they require amenities like sleepers, dining cars, lounge cars, and checked luggage facilities. The costs of food and labor for Amtrak’s long distance trains are highly significant, and this was borne out when the Department of Transportation’s Inspector General testified Amtrak could save $650 million by eliminating its long distance trains; David Gunn pointed out Amtrak wouldn’t save that much because of its costly labor protection contracts.

To claim Amtrak is the sole source of intercity transportation for residents of smaller communities who are not able to drive, or purchase a car raises questions. If somebody living in a small community is not able to drive would they be able to take a trip by any means of transportation, much less live without a car? How many people live in the smaller communities who either cannot drive or afford a car? How many of the smaller communities have to rely on Amtrak as their sole source of intercity transportation? Wouldn’t it be less expensive to subsidize an intercity bus line to serve the people in the smaller communities who have no other means of intercity public transportation?

[Anonymous]

well, if you add in capital costs of the NEC, yes, the LD trains are far cheaper. They only lose 350 million a year, and I bet if they had enough money to have extra sleepers for high demand seasons, that would be reduced significantly. Amtrak's problem right now is not enough coaches, sleepers, Dines, and Lounges on the Eastern trains, and not enough Coaches and Sleepers on the west.
Brad

[oltmannd]

Bob Johnston always does a nice job covering Amtrak, but I, too, have notice his tendency to let his opinions leak into his reporting.

Overall, Amtrak is expensive. For what we pay out in subsidy, we don't get back very much.... particularly compared to the subsidies (direct and indirect) for highway and air travel.

Traditionally, there have been two approaches to fixing Amtrak.

1. Prune out the "inefficient" parts of Amtrak. This is sort of like trying to lose weight by loping off a limb. True, you do lose weight , but is it worth the loss in functionality? It's been done several times and we still have the "problem".

2. Reform Amtrak. Most often this winds up being a exercise in rearranging the deck chairs....

Mostly, these two approaches cancel out and we wind up with status quo Amtrak year after year - each year becoming more and more of an anachronism.

Maybe the time has come to take a longer view of Amtrak and see just how much we can get for the money. If you took the politics, labor agreements, old-school RR culture and 1950's passenger train mindset out and just tried to see how much service could be provided for the money, maybe we'd get somewhere.

Food service on the trains is a good example. How in the world do you lose money selling food to a captive audience? Easy - high labor costs - 1950s style service. Even the cafe cars are a disaster. The customer throughput is abysmally low. The attendent has to go through so much motion just to serve a lunch, it's silly. The vast majority of what he sells is either already pre-packaged or could easily be make self-serve? I can get thru Kroger and Home Depot without needing the assistance of anyone. Why not the Amcafe?

[Paul Milenkovic]

The conventional wisdom is that the long distance trains (in rough round numbers) recover about 10 cents a mile in fares but require 30 cents a mile to operate and are subsidized at the rate of 20 cents a mile.

The real question is what are the LD train direct operating costs because everything is done using formulas. Labor is expensive but Amtrak workers are not paid that much compared with comparable industries. Rail cars are expensive, in part because they are heavy (if you cost it out per pound, busses are not that much cheaper than rail cars because they are much lighter and pack more people in), in part because they have become a custom one-of kind of thing. But apart from that, Amtrak does not pay all that much for the use of the tracks when you compare it to having to own and operate the tracks outright like they do in the NEC.

If you compare Amtrak with intercity bus, for a comparable level of service, Amtrak costs should be like a bus. The bus has the advantage of using the highways for the cost of the tax on fuel, but that is balanced by Amtrak getting a deal on sharing the tracks with the freight trains. The bus has the disadvantage that one driver can at most move 50 people, but that is balanced by the fact that bus drivers are made to drive the bus, be an attendant to the bus passengers, collect the fares or punch the tickets, and handle the checked baggage.

Yeah, yeah, I know everone here is a railfan and trains are great and busses are evil, but maybe the reason busses still break even or make a small profit is that they pack a lot of people in and give minimal service while Amtrak provides much more leg room and wider seats and dining cars and all of that while charging around the same rate as bus fare. The traffic congestion argument doesn't enter in because for every intercity bus bogged down in rush hour traffic somewhere, their is a passenger train in the hole to let a freight go by -- there is no excess capacity on the long-distance railroads without some major construction.

My sister related how a friend took the Empire Builder from a writer's workshop in Seattle to Chicago, the Empire Builder was hours late meaning that she missed the St Louis train and had to take the bus (so much for Amtrak providing an accomodation for those folks out there who can't ride the bus because they are too cramped). The friend related how on that bus ride she got to encounter enough "interesting people" to provide pages of material for her writing.

I suggested that part of the prejudice against taking the bus is the "interesting people" -- the bus is the low-cost alternative for those unable to travel by car which is increasingly those on the margins of society, and yes, the poor, and the unwashed, and those who cannot drive because they are on drug therapy for major mental illness who all need to get around, but a lot of us have "issues" with travelling in their company which we express in other ways so as to not appear so mean-spirited.

I suggested that maybe we need "first class and coach class" bus services to accomodate those who cannot travel with regular bus passengers and perhaps a subsidy to intercity bus service could provide a more comfortable ride along with a required frequency of service to get my sister's friend to St Louis.

Railroads are supposed to be about economies of scale. One train driver can move hundreds of people, but if you need to staff the train with ticket collectors, dining room people, and others, you may negate the labor saving properties of a train. Trains are supposed to be about accomodating large numbers of people and providing them lots of room, but if you are very generous with room and if railcars are very expensive to purchase and maintain, you negate that economy of scale.

So what are the Amtrak LD train direct operating costs? If they are low enough that train fares cover those costs and the subsidy is going into overhead, you could increase the number of LD trains without increasing the subsidy while decreasing LD trains won't reduce the required subsidy. If the costs are really 20 cents of direct cost subsidy for every 10 cents in fares, maybe that subsidy is better spent on improved intercity bus service.

The train has to have some kind of advantage apart from our attachment to things rail. If the subsidy is paying for things like amenities (increase leg room, dining cars, on-train staff), one has to take a hard look as to whether similar levels of amenities can be provided with lesser rates of subsidy on another mode.

[daveklepper]

I think Bon Johnson was right because Minetta used USA money to tell lies. He said the passenger count on the Empire Builder was less than half the real story. And USA Government economics on transportation is false because it does not included the costs of LAND USE. If you can dig up Ballabaugh's or Mary Whol's (with coathor) book on transportation you will see they assume land comes almost free!

[oltmannd]

QUOTE: Originally posted by daveklepper

I think Bon Johnson was right because Minetta used USA money to tell lies. He said the passenger count on the Empire Builder was less than half the real story. And USA Government economics on transportation is false because it does not included the costs of LAND USE. If you can dig up Ballabaugh's or Mary Whol's (with coathor) book on transportation you will see they assume land comes almost free!

Dave-

I agree with what you say about land use. But I can't agree with thinking Bob Johnston is "right" (I think you mean "justified") in editorializing within a news piece. It's still bad journalism. Someone else's bad behavior is never justification for your own.

[oltmannd]

Some good thoughts, Paul. Really like your economy of scale arguement, but I think Amtrak needs some serious rehab before they can get to a point where incremental LD trains cover their incremental cost.

Here are some thoughts and questions of my own:

Are Amtrak's worker really not paid that much compared to other workers? I'll bet Amtrak's dining car staff get paid a lot more than the staff at an Appplebees!

An LD train will typically have 12-15 crew and staff for roughly 250 passengers - that's the same ratio as a 'hound with 16 - 21 passengers aboard. And, I'll bet the 'hound driver makes less than ALL of the Amtak staff - even the car attendents.

A city transit trainset can move >250 people with an onboard staff of one. Why does Amtrak need 12-15?

Part of the reason passenger cars are expensive is all the "stuff" that gets added on. Automatic doors, announcment system, video screens, high tech climate control, etc. Wonder what a large order of KISS cars would cost?

-Don

QUOTE: Originally posted by Paul Milenkovic

The conventional wisdom is that the long distance trains (in rough round numbers) recover about 10 cents a mile in fares but require 30 cents a mile to operate and are subsidized at the rate of 20 cents a mile.

The real question is what are the LD train direct operating costs because everything is done using formulas. Labor is expensive but Amtrak workers are not paid that much compared with comparable industries. Rail cars are expensive, in part because they are heavy (if you cost it out per pound, busses are not that much cheaper than rail cars because they are much lighter and pack more people in), in part because they have become a custom one-of kind of thing. But apart from that, Amtrak does not pay all that much for the use of the tracks when you compare it to having to own and operate the tracks outright like they do in the NEC.

If you compare Amtrak with intercity bus, for a comparable level of service, Amtrak costs should be like a bus. The bus has the advantage of using the highways for the cost of the tax on fuel, but that is balanced by Amtrak getting a deal on sharing the tracks with the freight trains. The bus has the disadvantage that one driver can at most move 50 people, but that is balanced by the fact that bus drivers are made to drive the bus, be an attendant to the bus passengers, collect the fares or punch the tickets, and handle the checked baggage.

Yeah, yeah, I know everone here is a railfan and trains are great and busses are evil, but maybe the reason busses still break even or make a small profit is that they pack a lot of people in and give minimal service while Amtrak provides much more leg room and wider seats and dining cars and all of that while charging around the same rate as bus fare. The traffic congestion argument doesn't enter in because for every intercity bus bogged down in rush hour traffic somewhere, their is a passenger train in the hole to let a freight go by -- there is no excess capacity on the long-distance railroads without some major construction.

My sister related how a friend took the Empire Builder from a writer's workshop in Seattle to Chicago, the Empire Builder was hours late meaning that she missed the St Louis train and had to take the bus (so much for Amtrak providing an accomodation for those folks out there who can't ride the bus because they are too cramped). The friend related how on that bus ride she got to encounter enough "interesting people" to provide pages of material for her writing.

I suggested that part of the prejudice against taking the bus is the "interesting people" -- the bus is the low-cost alternative for those unable to travel by car which is increasingly those on the margins of society, and yes, the poor, and the unwashed, and those who cannot drive because they are on drug therapy for major mental illness who all need to get around, but a lot of us have "issues" with travelling in their company which we express in other ways so as to not appear so mean-spirited.

I suggested that maybe we need "first class and coach class" bus services to accomodate those who cannot travel with regular bus passengers and perhaps a subsidy to intercity bus service could provide a more comfortable ride along with a required frequency of service to get my sister's friend to St Louis.

Railroads are supposed to be about economies of scale. One train driver can move hundreds of people, but if you need to staff the train with ticket collectors, dining room people, and others, you may negate the labor saving properties of a train. Trains are supposed to be about accomodating large numbers of people and providing them lots of room, but if you are very generous with room and if railcars are very expensive to purchase and maintain, you negate that economy of scale.

So what are the Amtrak LD train direct operating costs? If they are low enough that train fares cover those costs and the subsidy is going into overhead, you could increase the number of LD trains without increasing the subsidy while decreasing LD trains won't reduce the required subsidy. If the costs are really 20 cents of direct cost subsidy for every 10 cents in fares, maybe that subsidy is better spent on improved intercity bus service.

The train has to have some kind of advantage apart from our attachment to things rail. If the subsidy is paying for things like amenities (increase leg room, dining cars, on-train staff), one has to take a hard look as to whether similar levels of amenities can be provided with lesser rates of subsidy on another mode.

[Paul Milenkovic]

On the subject of train staffing and labor costs, how does it work on Amtrak (and perhaps by way of comparison on Greyhound) in terms of long distance trains and the hours a person gets paid vs the hours they are away from home.

URPA makes the point that the LD trains are more productive than corridor trains because the LD trains keep on rolling through day and night while the corridor trains make one or more short day trips. The productivity of the LD trains may vary depending on how many train sets you need to cover the service -- if the Empire Builder needs to leave Chicago before the inbound one gets to Chicago, you need an extra train set to cover the service.

Anyway, the Empire Builder takes 40+ hours to get to where it goes. Do you have people going the whole 40 hours and sleeping in crew dorms? How are they paid and how do on-duty and off-duty hours count?

I guess where this is going is I am trying to come up with some numbers independent of Amtrak on what it costs to run these trains.

[oltmannd]

How are they measuring productivity? Passenger miles/car day? Revenue dollars/car day? It would be interesting to see.

I'm inclined to believe Amtrak's internal numbers that they publish each month. The current arrangement was instituted by Gunn and, as far as I can tell, he's not anti-LD train.

I'm also inclined to think that Amtrak better come up with some ways to cut unit costs. Cutting routes to save money just doesn't work. Claiming labor agreements don't allow changes may be true, but if you don't ever start laying the groundwork for some better agreements now, you'll never get them.

Here's some more ideas:

-perhaps, like UPS package sorters, on board service jobs shouldn't be though of as "careers" but as stepping stones to something else.

- for car attendents, hire college kids a semester at a time into a coop program. Allow them to work all the LD routes so that they get to see a lot of the country and all of Amtrak's facilities. Give them ample days off between runs to explore.

-you could also use the "campground host" idea on LD trains. Give retired folk free passage in exchange for working on board the train. They would just have to sign up for some minimum number of trips a year.

-you could do self-service for snacks - including checkout and paying

-you could have the diner and lounge car do double duty. Use the diner as the lounge outside of meal times.

-you could have people pay for a seat in the diner on top of the meal cost. i.e. $5 to be able to sit there for an hour. Maybe less if they reserve their meal time at the time of ticket purchase.

-you could contract out the meal service and let the provider figure out the logistics. Cook on board vs. reheat vs. deliver hot to train enroute.

-you could have passengers reserve meals at the time of ticket purchase and pre-pay

-you could provide a wider selection of food in the diner, from kid's "happy meals" to cheap, "airline" style meals that would be reheated, to cooked onboard specialties that would cost big $$.

-you could bring back the snack cart and go peddling food down the aisle of the coaches

-you could collect tickets at the stations instead of on board.

The problem is that Amtrak's LD trains have crew productivity very similar to that of the 1950s and I don't think that'll cut it in the 21st Century. Huge strides have been made in all other sectors of the economy since. Where is the incentive for Amtrak to improve?

[AntonioFP45]

Though I was a union member for a transit company, I've always felt that Amtrak would be more attractive if they leased their dining and lounge cars out for bids to restaurant chains.

Depending on if it's long or medium distance you can have anything from a Sandwich shop (like Subway) to a full meal menu like Denny's.

I'm sure this has been considered already.

I've eaten on Amtrak before. While the rides were pleasant, the food was priced quite high. From what I've read, this is to help recover some of the labor and food purchase costs.

[Chernobyl]

Please no meal carts; having those things block the aisle for hours on end is a reason I hate flying.

The dining car (on the last train I rode, the sunset limited) already requires reservations for dinner. And the meals are expensive enough already...there's no need to ask for another $5 3x a day just to sit at a table for a meal. Attendants make the point of saying there's no sales tax on items bought on board, but the prices make up for it, believe me. The meals are quite good, but I think they're probably about 10-15% too high. and some things didn't make sense to me. The Dinner meals included a glass of wine with the price - but I don't drink alcohol. Instead, I had to pay extra (far too much) for a soft drink with my meal.

as far as cost per passenger go, the buses and planes cram you in like sardines. the seats at the movies often have more legroom that buses or planes!! Even coach on a train has wonderful legroom. I wouldn't trade it for lower ticket prices.

As far as delays go, severl times on my sunset limited trip we were "dead on the law" and at a standstill waiting for hours for a replacement crew to relieve the engineer. but let me ask a question - on a passenger train, why in the world can't they have 2 shifts of engineers? let the others sleep when one is on duty!!

high cost of passenger cars?
automatic doors - needed. freight track is not the most level of surfaces. asking an elderly person to slide something like that open on a rough patch of track is asking for a lawsuit.
announcing system - needed. that is standard emergency equipment. communication is important.
high tech climate control - ok, lets see you ride a bus across arizona and new mexico with no air conditioning. or across Donner pass in december/january.
and its not that high tech, believe me.
video screens? I only saw 3 on my trip, and they were all in the lounge car. They're only monitors though; can't tun in TV and only show whats on the VCR. Thats right VCR. I don't think a DVD player is made that could withstand the vibrations on a long distance train.
self service snacks...let me go find the conductor or meal car attendant for change, because that machine won't take my money.
diner and lounge car as double duty would be pointless. you'd only get about an hour between meals, between cleaning and prep, if that. most meal times are 3-4 hours, and often run into each other changing time zones.

Paul, I feel your pain when it comes to train punctuality. WHen I rode the Sunset limited home for christmas, I rode to bus from new orleans to orlando. The train was 12 hours late getting there. The bus took 12 hours to orlando, and the train was scheduled 24 hours. Of course, the bus didn't stop everywhere. The train on the return trip was on time, maybe 15 minutes late. plenty of time for connection. of course, when you travel over new years, there's not much freight traffic, so I suppose I shouldn't have expected less. I suppose its not about the destination, its about the journey.

and as for justification for why we have long distance trains? because there needs to be more options than highway or air. both are less fuel efficient than trains, and thats going to be a HUGE issue in 20-30 years when there's no more oil. laugh if you will, oil won't last forever, everyone knows that. Its just nobody can agree on when we're going to run out.

Chernobyl