In the golden era of long distance passenger rail services, there were several all-coach overnight long distance trains. These were not the primarily express mail trains with one-two coaches, but deluxe trains. The NYC's Pacemaker was all coach for some years. The PRR ran the Trailblazer. And the finest was the all-high level El Capitan on the ATSF (two nights). There were others, earlier, such as the UP/CNW/SP Challengers, I believe. All had dining cars, at least as I recall from riding the Cap several times in the early 1960's. I do not recall having to sign up for a "seating" either. The food was as good as on the CZ at that time.
Why cannot Amtrak consider this option on some/all LD trains?
C&NW, CA&E, MILW, CGW and IC fan
Weren't those trains primarily created as an alternative to the all Pullman trains on the same route? That was the case with El Capitan and Super Chief.
Amtrak effectively provides the coach option on its LD trains. It just adds sleepers as well. Personally, I think that's the best option, as the traveler has more choices for how to spend the time on board. If I am okay with sitting in coach all night, then I can do so and if I want to spring for a bed of some sort, I can do so.
Considering that when I look in the Amtrak booking system, I tend to see that I can get a coach seat, but all other options are sold out, there seems to be a demand for the beds, so it'd be silly to drop them, as I doubt all those passengers would be happy to ride in coach.
I've ridden overnight in coach on Amtrak and in Europe and have no issues with doing so. For others, a bed is a must…
It is all a matter of lack of equipment. Amtrak's business class now offered is a close second to prior Deluxe coach service. It may be a better way to add a business class coach to present overnight trains.. Then if it fills up add another BC coach to the train, However ----
It is a matter of equipment. For just the east coast single level trains there is no available equipment to convert some to business class. That will remain until some single level coach cars are built. --- Or --- Also once some of the Midwest bi-level cars under construction replace some of the single levels. Maybe then business class could be added to trains. Fare charges should be high enough to allow revenue to be at least neutral compared to coach charges.
To just add a business class coach to one LD train requires about 5 cars to cover all train sets. I would suspect that extra business class cars might be added to present business class trains. The Palmetto & Carolinian often sells out BC many days so another car on those trains might be the first trains to be added. NYP -- Albany also sells out often but not so much west of Albany.
The Palmetto and Carolinian when enough equipment available could keep an extra car(s) at termination points and only add another car(s) at both ends when BC sells out in either direction.
schlimmThere were others, earlier, such as the UP/CNW/SP Challengers, I believe.
All? the "luxury" coach trains ran on routes that had sleeper trains too.
By the time I was old enough to ride the PRR's Trail Blazer, as well as the Santa Fe's El Capitan and the UP's Challenger, they had been combined with their all Pullman counterparts. The PRR's coaches were a distinct step down from those on the western trains.
I made numerous trips on the PRR from Altoona to New York whilst in high school. I usually returned home on the General, which by 1956 if not before had the Trail Blazer's coaches. It also had a double dining car. I don't remember being required to have a reservation to eat in the dining car.
As a young person I made several trips across the United States in coach class. I also made several trips from Pennsylvania to Florida in coach class. Not a problem for a young person, but I would not want to do it today.
Only 2.2 per cent of Amtrak's system passengers booked a sleeper in FY13. Approximately 14.5 per cent of the long distance passengers booked a sleeper. These percentages have remained relatively constant for the last five years or more.
According to the DOT IG's 2005 report, the subsidy for sleeping car passengers was considerably higher than the subsidy for coach passengers. Whether that is still true is unknown. As far as I know the study has not been replicated, but I would be surprised if the outcomes would be dramatically different if the study was repeated.
I am hard pressed to understand why it is in the public interest to subsidize people who have the means to go first class.
Given the results of the 2005 study, a prudent business management team would either raise the fares for the sleepers, as well as the prices in the dinning car, to eliminate the subsidies or at least put them on a par with the subsidies for coach passengers.
Most of the influential advocates for Amtrak probably are articulate, higher income people who know how to push the political power levers, which is important when trying to influence a government railroad. To the extent that they ride the trains, they want first class service, i.e. Acela Express, business class, sleeping cars, etc. Even if it were in the public interest to run coach only long distance trains, this group probably would have a hundred reasons why it is not a good idea.
No, the 2005 DOT IG report was almost immediately rebuffed in at least one report I am aware of from the "Advocacy" community and now Amtrak sees the incremental Revenue from Sleeper class as higher than the incremental Cost. In other words it lowers the operating loss, so why not differentiate the product. Honestly, coach should have two better defined classes.
In particular the 2005 report assumed, even for the Western trains, that only one locomotive would be used reliability to the wall, checked baggage eliminated, and all dinning service eliminated, while assuming with those changes that no coach revenue would be lost. It did go on to say that perhaps just lowering the cost for all these services made more sense near the very end. The report was an unprofessional at best effort that would appear to be politically inspired not a actual analysis of the situation.
schlimm In the golden era of long distance passenger rail services, there were several all-coach overnight long distance trains. These were not the primarily express mail trains with one-two coaches, but deluxe trains. The NYC's Pacemaker was all coach for some years. The PRR ran the Trailblazer. And the finest was the all-high level El Capitan on the ATSF (two nights). There were others, earlier, such as the UP/CNW/SP Challengers, I believe. All had dining cars, at least as I recall from riding the Cap several times in the early 1960's. I do not recall having to sign up for a "seating" either. The food was as good as on the CZ at that time. Why cannot Amtrak consider this option on some/all LD trains?
V.Payne No, the 2005 DOT IG report was almost immediately rebuffed in at least one report I am aware of from the "Advocacy" community and now Amtrak sees the incremental Revenue from Sleeper class as higher than the incremental Cost. In other words it lowers the operating loss, so why not differentiate the product. Honestly, coach should have two better defined classes. In particular the 2005 report assumed, even for the Western trains, that only one locomotive would be used reliability to the wall, checked baggage eliminated, and all dinning service eliminated, while assuming with those changes that no coach revenue would be lost. It did go on to say that perhaps just lowering the cost for all these services made more sense near the very end. The report was an unprofessional at best effort that would appear to be politically inspired not a actual analysis of the situation.
Please provide an audited analysis showing that the incremental revenues associated with Amtrak's sleeping and dining car operations cover the incremental costs. Please include fully allocated costs, including depreciation, interest, and miscellaneous charges from Amtrak's books.
The 2005 DOT IG's report was rebuffed by those who did not like the outcomes. NARP led the parade. Many of its assertions were unsupported. The DOT is not in the habit of generating unprofessional reports. I read over NARPs objections and several others. Their criticisms of the report were speculative. They are not worth revisiting.
Meanwhile, the losses incurred by most of the long distance trains have increased substantially, even after adjustment for inflation. From 2011 to 2012 the long distance train losses increased $85.8 million. From 2009 through 2012 they lost $2.3 billion, an increase of 16.8 per cent, before depreciation, interest, and miscellaneous charges.
I track the two long distance trains that serve Texas, i.e. the Texas Eagle and the Sunset Limited, as well as the Heartland Flyer.
Between 2009 and 2012 - I have not put the 2013 numbers into my spreadsheet yet - the Texas Eagle had a 32.2 per cent increase in ticket revenues, a 29.8 per cent increase in passengers, a 28.8 per cent increase in sleeping car passengers, and 18.6 per cent increase in its average load factor. The per cent of Eagle passengers booking a sleeper declined 1.4 per cent.
The Texas Eagle has improved its financial results significantly. In 2013 it had the third lowest loss per passenger mile (16.8 cents), just below the Auto Train (14.0 cents) and the Empire Builder (15.5 cents). These numbers are before depreciation, interest, and miscellaneous charges. This is the good news. Now for the other side of the coin.
The operating loss from 2009 to 2012 for the Eagle increased 37.3 per cent before OPEBS and 35.2 per cent after inclusion of these items. The loss per passenger mile increased from 16.8 cents to 18.8 cents and the loss per seat mile increased from 10.1 cents to 13.4 cents.
Between 2009 and 2012 the Sunset Limited had a 36.8 per cent increase in ticket revenues, a 28.5 per cent increase in passengers, a 15.8 per cent increase in sleeping car passengers, and 21.2 per cent increase in its average load factor. The per cent of Sunset Limited passengers booking a sleeper declined 9.9 per cent.
Over the same period the Sunset Limited's operating loss increased 16.2 per cent before OPEBS and 15.0 per cent after inclusion of these items. The loss per passenger mile decreased from 54.3 cents to 49.9 cents, but the loss per seat mile increased from 22.8 cents to 25.4 cents.
According to Amtrak's audited records, sleeping car passengers contribute a proportionally higher per cent of ticket revenues. In 2012 the made up 14.6 per cent of the long distance train passengers and contributed 35.1 per cent of ticket revenues. Part of the ticket revenues would have been for for transportation, part for accommodation, and part for meals.
To determine the full cost of toting sleeping car passengers, one would have to know the variable and fixed costs of the sleeper as well as the but the embedded cost of the dinning cars devoted to the sleeping car passengers. If Amtrak publishes information about its sleeping car costs, including the depreciation, etc., and portion of the dining car costs that should be allocated to sleeper operations, I have not found it.
All of the information presented above is taken from Amtrak's audited records. None of it is speculative.
Sam1 Given the results of the 2005 study, a prudent business management team would either raise the fares for the sleepers, as well as the prices in the dinning car, to eliminate the subsidies or at least put them on a par with the subsidies for coach passengers. Most of the influential advocates for Amtrak probably are articulate, higher income people who know how to push the political power levers, which is important when trying to influence a government railroad. To the extent that they ride the trains, they want first class service, i.e. Acela Express, business class, sleeping cars, etc. Even if it were in the public interest to run coach only long distance trains, this group probably would have a hundred reasons why it is not a good idea.
I think you hit the nail on the head. I doubt if you will ever get full financial data, but if you did, it would probably confirm your hypthesis that sleeper cars are a subsidy primarily benefiting higher income folks.
I don't think Amtrak audits their internal business plan or the few instances where a speech is given. Does any company? I have a fairly detailed spreadsheet I use to reconstruct train costs, down to maintenance and depreciation. The only way to get cost efficiency is to serve as much volume with a single train, which is why coach only trains really don't help all else being equal.
I am a bit of a loss in responding as Mr. Sam was quoting Fully Allocated numbers in the response while talking about Variable costs, aka more or less net subsidy.There are about $800 million in fixed infrastructure costs in the Fully Allocated number for NEC commuter infrastructure and stations used by others. Remember the recent report showing these were 80% allocated. Also accounting methods changed in the period mentioned.
Maybe someone can answer this question. Where are the long term variable passenger mile metrics that PRIIA was supposed to get us? The FRA PRIIA reports were still blank last I checked.
I believe an IG audit report is far more credible than some spreadsheet any of us created from undocumented data sources.
Discussing the relative subsidies of long-distance coach passengers and long-distance sleeper passengers is intersting but doesn't answer the original question.
The answer is simple. In the days of all-Pullman and all-coach streamliners, there was enough business to run separate trains for both classes of service. Today, there just is not that much business. And if more trains were run for more business, greater frequency would be the goal, not separation of two classes of service.
There is still a pretty substaintial lack of basic data reporting, hence my recreation of the cost data, which matches with Amtrak's Direct Cost numbers when reported, but from an independent basis. I have a masters degree in engineering and recreate costs as part of my job.
For example PRIIA was supposed to give us this per the FRA at http://www.fra.dot.gov/Elib/Document/1511:
"The Proposed Metrics and Standards included five different metrics under the Financial/Operating category: (1) Percent of Short-Term Avoidable Operating Cost Covered by Passenger-Related Revenue (excluding capital charges); (2) Percent of Fully Allocated Operating Cost Covered by Passenger-Related Revenue (excluding capital charges); (3) Long-term Avoidable Operating Loss per Passenger Mile (excluding capital charges); (4) Passenger-Miles per Train-Mile; and (5) Adjusted (Loss)3 per passenger-mile. The first four of these were to be reported at the route level and the last, at the system level. For all five, the proposed standard was to be continuous year-over-year improvement. In these Final Metrics and Standards, the same measures are retained; all financial measures will be calculated both with and without State subsidies included in revenue. "
5 years later those data points are still not generated...
In the Golden Era, at least until the early 1950's, rail was still the main mode of travel, not just for vacationers, but also for business travelers on expense accounts, hence the large number of trains containing sleepers. The deluxe coach trains were an attempt to offer better overnight coach services.
Today, very few business travelers use overnight trains, sleeper or not. So who uses the sleepers on the CZ, EB, SWC and SL? Demographics are mostly older folks, with sufficient disposable income to pay considerably more than airfare. Subsidizing the rich makes little sense, so raising the sleeper fares to cover the costs and making all passenger who choose to use the dining service pay at the table would bring that practice to an end.
schlimm In the Golden Era, at least until the early 1950's, rail was still the main mode of travel, not just for vacationers, but also for business travelers on expense accounts, hence the large number of trains containing sleepers. The deluxe coach trains were an attempt to offer better overnight coach services. Today, very few business travelers use overnight trains, sleeper or not. So who uses the sleepers on the CZ, EB, SWC and SL? Demographics are mostly older folks, with sufficient disposable income to pay considerably more than airfare. Subsidizing the rich makes little sense, so raising the sleeper fares to cover the costs and making all passenger who choose to use the dining service pay at the table would bring that practice to an end.
You know what? If they were smart about it they could increase revenues via additional services. For example Rocky Mountaineer provides door to door baggage service but does not charge for it. Amtrak could do the same and charge for it. American Airlines offers the service from DFW and charges passengers for it. You arrive, get off the plane skip baggage claim and the bags are delivered to your home about 4 hours later. American charges $30 for the service and offers it to select passengers only that have a history of buying additional services. Amtrak could do the same using the package express model but instead hire local cab firms to deliver the bags within a specific mileage restriction of the station.
Another service? Perhaps offer pre-order of higher end meals with a better wine selection when passengers buy their tickets, after all they do this already for kosher meals and the meals are for the most part just reheated.
Another service? Spend a little money and offer Wi-Fi cross country like VIA Rail Canada does.
Another service? Offer room upgrades on the train for frequent travelers when space is available, free up the Economy rooms and attempt to sell them to Coach passengers. I read somewhere Amtrak is going to try something like this and that was the reason for the new ticket scanners. Not sure what model they are going to use though.
Another service? Improve the quality of the sheets and blankets on board. Some of the sheets are yellowed for Pete's sake......Gee, I think it's time to retire those.
Agree though, they should either charge for Sleeping passenger meals or account for them in their Dining Car stats and yes, IMHO, Amtrak does not charge enough for sleeping car compartments......especially the Deluxe Bedroom and what do you know, I am a client of Amtrak LD Deluxe bedrooms making that statement. They probably could charge another $150 RT easily without reducing the occupancy that much.
As long as we are on the subject of undercharging though. Amtrak ticket prices for all coach trains, especially the state subsidized runs are not often adjusted upwards. I used the example of the Chicago-Milwaukee trains as an example. Fares have been largely stagnant in that corridor for like a decade or more, they could bump those up $2.50 each way and not notice much of a ridership impact.
Lots of good ideas there which could easily increase revenue and also the quality of service. So why isn't someone at Amtrak coming up with ideas like that? Too much of a corporate climate of "that's what we always have done" or two-hour seating blocs?
As an annual LD rider, I am fortunate that I have never encountered CMStPnP's listed problems (though my trips have been confined pretty much to one route), with the exception of the "fill out your own order" dining car tickets-which, I believe, predates Amtrak.I like your suggestions very much. I could see baggage pick up/delivery being perhaps the best revenue generator. The most popular would be Wi-Fi but I fear it could get too expensive to implement.
I have taken advantage of upgrades from coach to unsold sleeper space several years ago. I don't know how widespread or advertised this sort of thing is. As a frequent traveler perk, it could become quite a thing.
Re: sleeping car charges. I have often thought that future Superliner sleeper orders should change the upstairs configuration to all roomettes. This would add 10 more where the bedrooms now are plus, I think, an 11th one across from the stairwell. This would allow more people to use sleeping car accommodations at lower cost but with no loss of ticket revenue. Perhaps a return to the Slumbercoach for single travelers?
daveklepper In the days of all-Pullman and all-coach streamliners, there was enough business to run separate trains for both classes of service. Today, there just is not that much business. And if more trains were run for more business, greater frequency would be the goal, not separation of two classes of service.
In the days of all-Pullman and all-coach streamliners, there was enough business to run separate trains for both classes of service. Today, there just is not that much business. And if more trains were run for more business, greater frequency would be the goal, not separation of two classes of service.
Says it all in three sentences.
Whether Amtrak has the numbers in its business plan audited is unknown. Many large corporations, however, have the numbers in their business plans audited by their internal auditors or their external auditors. Most large organizations also have the essence of the plan stress tested by independent consultants, auditors, etc. This is especially true if they are a highly regulated business, and they plan to publish the plan.
Amtrak does not own all of the NEC. Nor does it wear all the revenues, costs, and expenses associated with the NEC. Amtrak bills the commuter and freight operators for their use of its portion of the NEC. This would include use of Amtrak's owned stations, i.e. NY Penn Station and 30th Street Station. By the same token, Amtrak is billed for its use of the portions of the NEC (stations, facilities, etc.) that it does not own.
The DOT IG's report on Amtrak's APT and SAP systems did not say that Amtrak's allocations are wrong. It's major criticism was that Amtrak had done a lousy job of implementing the two systems so that they could talk to each other. The most scathing criticism, in my view, is that the company did not evaluate and re-engineer its business processes before implementing SAP. It further highlighted two significant accounting issues.
"the company has not yet demonstrated that it can produce performance reports in a timely manner to meet statutory reporting requirements." The ability to produce reports timely is different from saying that the reports that it does produce are wrong.
"In addition, Amtrak’s heavy reliance on cost allocation reduces the precision of its performance reporting." Reducing precision does not mean that the allocations are out of whack. It means that with more direct costing, i.e. an automated assignment of costs, the outcomes could be more precise. The report noted that Amtrak relies on a formula to assign fuel costs per train route. It did not say that the formula is wrong; it said that the results could be more precise if it had the actual costs for each locomotive.
In the case of the the Texas Eagle, for example, Amtrak has the fuel costs. The Eagle is fueled in Chicago and Fort Worth. At Fort Worth the fuel is delivered by an independent contractor. He gets paid by presenting fuel tickets to Amtrak for payment. The fuel tickets contain the number of gallons delivered and the cost per gallon. Whether Amtrak uses these tickets to check its fuel use formula is unknown, but the tickets for the Eagle, as well as other contractor fueled trains, gives it the ability to do so.
Again, without access to Amtrak's books, any conclusion about how it allocates shared costs (expenses) is speculative. For the most part I don't go there. I rely on what Amtrak shows in its published reports.
V.Payne I am a bit of a loss in responding as Mr. Sam was quoting Fully Allocated numbers in the response while talking about Variable costs, aka more or less net subsidy.There are about $800 million in fixed infrastructure costs in the Fully Allocated number for NEC commuter infrastructure and stations used by others. Maybe someone can answer this question. Where are the long term variable passenger mile metrics that PRIIA was supposed to get us? The FRA PRIIA reports were still blank last I checked.
I am a bit of a loss in responding as Mr. Sam was quoting Fully Allocated numbers in the response while talking about Variable costs, aka more or less net subsidy.There are about $800 million in fixed infrastructure costs in the Fully Allocated number for NEC commuter infrastructure and stations used by others.
What is the source for the $800 million in fixed infrastructure costs in the fully allocated NEC number?
As per Page C-1 of Amtrak's September 2013 Performance Report, Total Costs excl. OPEB's, Capital Charge and Other Costs. OPEB stands for Other Post Employment Benefits. These costs, including the OPEBs, flow through the financial statements as variable expenses. Sometimes mixed costs, as per below, have the appearances of being a fixed cost, but upon close examination it is clear that only the variable portion is flowing through the expense stream to determine the operating contribution/loss.
When Amtrak buys something, i.e. fuel, labor, etc., it incurs a cost. When the cost flows through the income statement, it is an expense.
Accountants typically classify costs in one of three buckets. As far as I know Amtrak follows the same cost accounting models.
Variable costs are those that are incurred because Amtrak runs trains, operates stations, etc. Its biggest variable costs are direct labor, fuel, on-board supplies, and rents to hoist railroads. If it does not run any trains, most of these costs would go away within a year.
Fix costs are those that are incurred because Amtrak owns an asset. Irrespective of whether the company has any operations, the costs have been incurred, and they flow through the income statement or statement of operations as an expense. Amtrak's biggest fixed costs are the cost of the NEC infrastructure and its equipment costs. These items are capitalized and flow through through the income statement as depreciation expense. Another example is a fixed cost debt service, i.e. principal payments, interest expense, etc.
Mixed costs are those that have some variable cost characteristics and some fixed cost characteristics. Maintenance is a good example. When Amtrak runs a train, it incurs some maintenance costs because of the mileage that it puts on the equipment. This is the variable portion of the mixed costs. If it parks the equipment, it still has some maintenance cost. It may have to energize the equipment to keep it from deteriorating, provide guards to protect it from vandals, etc. In addition, it still has the depreciation expenses associated with its maintenance facilities, tools, indirect labor, etc.
The numbers shown in the second and fourth columns of Page C-1 are variable expenses, although some of them may appear to be fixed costs. They include fully allocated variable costs, including the variable portion of any mixed costs. These are the expenses, subtracted from the revenues, that generate the contribution/loss per route, passenger mile, and seat mile.
The major fixed costs (depreciation and interest) are not assigned as per the following note: Amtrak does not report depreciation on a route level due to the distortion caused by the sale and leaseback transactions of the late 1990’s and early 2000’s. Allocating depreciation and interest would unfairly burden routes whose equipment was sold and then leased back. Those transactions caused the value of those assets to increase and therefore their depreciation to increase, which is unrelated to the actual capital cost of that equipment. A synthetic capital charge is under development and will be allocated to routes and included in this report when available.
There is one other cost that is misunderstood frequently. Avoidable costs (expenses)! These are the expenses that would go away if Amtrak discontinued a business line or went out of business. Determining the avoidable variable expenses is relatively easy, but determining the avoidable mixed and fixed expenses, especially over the short run, would be a challenge.
Amtrak claims that not all of the expenses associated with the long distance trains would be avoided if they were discontinued. True! But the key question is how many of them would a self servicing management team identify vs. how many would a disinterested consultant identify?
All costs and expenses are variable over long run. Equally important, most costs and expenses can be avoided in the long run. The avoidance amount depends on whether the company is discontinuing a line of business or the business is being liquidated.
I am a CPA. I have worked with cost accounting models for years. I know how cost accounting models usually work. Having said that, the only thing that I know about Amtrak's costs models and expense flows is what it publishes in its operating statements and financial reports. Sans access to its books and cost allocation models, any conclusions about Amtrak's costs and expenses, as well as how they are allocated, is speculation.
I thought the Chicago to Duluth-Superior "North Star" was predominately an all sleeper train run by Amtrak. It was paid for by MN DOT. Would be curious to know how it did? The train only passed through the Milwaukee suburbs on it's way to Chicago around 5 or 5:30 a.m. It ran for I think 6-8 years before MN DOT cut the subsidy and Amtrak ended it.
Sam1 In the case of the the Texas Eagle, for example, Amtrak has the fuel costs. The Eagle is fueled in Chicago and Fort Worth. At Fort Worth the fuel is delivered by an independent contractor. He gets paid by presenting fuel tickets to Amtrak for payment. The fuel tickets contain the number of gallons delivered and the cost per gallon. Whether Amtrak uses these tickets to check its fuel use formula is unknown, but the tickets for the Eagle, as well as other contractor fueled trains, gives it the ability to do so. Again, without access to Amtrak's books, any conclusion about how it allocates shared costs (expenses) is speculative. For the most part I don't go there. I rely on what Amtrak shows in its published reports
Again, without access to Amtrak's books, any conclusion about how it allocates shared costs (expenses) is speculative. For the most part I don't go there. I rely on what Amtrak shows in its published reports
Another area of missed opportunity, why doesn't Amtrak arbitrage it's fuel costs like the airlines do to reduce costs. Interesting they would buy from a contractor instead of the same firm........cross country through a negotiated rate.
I try to stay away from the specifics of accounting because it's an area that I don't know well enough. So I can't comment on any of that stuff. As for other issues, it should not be a surprise when I say I'm more in accord with daveklepper and dakotafred than anybody else. Kevin also makes some interesting points.
The idea of an all-economy room car is intriguing. I still can't bring myself to call those things roomettes. Two of the six sleepers on the Auto Train have ten bedrooms upstairs instead of the usual 10/5 arrangement. These are the "Palm" cars (which have all lost their names); the W. Graham Claytor; and the A. Phillip Randolph (formerly A. Philip Randolph --- they spelled it right the first time, but not the second). That works for the demands of that train. Maybe the all-economy car could work elsewhere. I'm not so sure about adding the extra economy room at the head of the stairs, but I guess it might be possible.
I don't understand the objections to scheduled diner seatings. If the goal is to fill the diner and maximize utilization and revenue, then we ought to try to reach the optimal seating level, which is 60 people per seating. When you run that close to the overflow level, you have to carefully monitor the numbers so that you don't exceed capacity and have to turn people away and tell them to come back later. On the other hand, a casual, come-in-when-you-like policy implies that the car has lots of spare room because there's not much business. On my last southbound trip, we had 60 in the first seating; 60 in the second; and 62 in the third. A successful dining car operation (which most people agree is the case on the Auto Train) can't be that casual.
Tom
CMStPnP Sam1 In the case of the the Texas Eagle, for example, Amtrak has the fuel costs. The Eagle is fueled in Chicago and Fort Worth. At Fort Worth the fuel is delivered by an independent contractor. He gets paid by presenting fuel tickets to Amtrak for payment. The fuel tickets contain the number of gallons delivered and the cost per gallon. Whether Amtrak uses these tickets to check its fuel use formula is unknown, but the tickets for the Eagle, as well as other contractor fueled trains, gives it the ability to do so. Again, without access to Amtrak's books, any conclusion about how it allocates shared costs (expenses) is speculative. For the most part I don't go there. I rely on what Amtrak shows in its published reports Another area of missed opportunity, why doesn't Amtrak arbitrage it's fuel costs like the airlines do to reduce costs. Interesting they would buy from a contractor instead of the same firm........cross country through a negotiated rate.
As per Page 13 of the 2012 Amtrak Financials, which are extracted from the 2012 Amtrak Annual Report, Amtrak periodically enters into limited derivative fuel contracts to manage the fluctuation in energy prices. Whether the contracts are futures or forwards is unclear. But the purpose is the same. Only the method of engagement is different.
As of September 30, 2101 Amtrak had four fuel derivative contracts. The fair value of the contracts at September 30, 2012 was $10.4 million vs. $16.4 million at the end of FY11. The contracts probably were for the fuel at Amtrak's major service hubs, i.e. Los Angeles, Chicago, Miami, Washington, etc.
I have seen the Texas Eagle being refueled at Fort Worth. I have also seen the Southwest Chief being refueled in Albuquerque. The fuel was being provided by contract haulers as per the signs on the side of the trucks.
"What is the source for the $800 million in fixed infrastructure costs in the fully allocated NEC number?
The FRA. Start at http://www.fra.dot.gov/Page/P0532 , http://www.fra.dot.gov/Page/P0606 , and http://www.fra.dot.gov/Page/P0607 (last is the most important) for some background.
This document, on page B-4 has the table from which I see about $800 in yearly fixed (with respect to train operations) maintenance and capital costs for NEC infrastructure. http://www.fra.dot.gov/eLib/Details/L04156
"The numbers shown in the second and fourth columns of Page C-1 are variable expenses, although some of them may appear to be fixed costs."
I don't think that is correct. Remember, from the header of the monthly reports Amtrak is reporting "Financial Performance of Routes - Fully allocated overhead, excluding Depreciation and Interest" in their reports and not the Avoidable costs the FRA report mentions, or the short and long term variable costs per passenger mile as PRIIA mentioned.
Take a look at Page 29 (49 in the PDF) of this document: http://www.fra.dot.gov/eLib/Details/L04154 for the FRA's discussion of Avoidable and Fully Allocated costs. By statue I believe Amtrak is supposed to report avoidable but for some reason has decided not to do so.
My point is that the conversations that we have about operations of different types of trains or service types are practically irrelevant under the reporting methods being used. Maybe an all coach daytime train would be good but to say it is better to the exclusion of everything else from Amtrak's numbers is not reasonable. Practically, one has to figure things out otherwise. Maybe the "Other Customers" at the bottom of the sheet should have a higher cost allocated to them.
If there is one thing worse than psuedo engineers arguing a engineering point - it is psuedo accountants arrguing accounting points.
Never too old to have a happy childhood!
Having slept on it overnight, I realize that I ask Mr. Payne the wrong question. Please furnish us with the name of the Amtrak person or persons, together with their email addresses and phone numbers, who have given you access to Amtrak's books and, therefore, placed you in a position to know that the allocation of its expenses during FY13 is suspect.
Don Phillips raised a similar objection to Amtrak's allocation of NEC expenses in a previous issue of Trains. He said that he had reliable source for his claim. I sent him a snail mail letter asking for the name of the source, together with how he gained access to Amtrak's books to verify the claim. I am still waiting to hear from him.
Amtrak has tried to make the long distance trains as viable as possible for more than 40 years. It has failed miserably. Only those in a serious state of denial would continue to argue that they can be financially viable.
BaltACD If there is one thing worse than psuedo engineers arguing a engineering point - it is psuedo accountants arrguing accounting points.
I worked for more than 30 years as a senior accounting and audit manager for a Fortune 250 corporation. Having said that, the real problem is that no one here has access to Amtrak's books and, therefore, does not know how Amtrak allocates costs, hedges fuel costs, books revenues, etc. The only thing that we know about Amtrak's financials is what the company publishes. Some people, however, appear to have a difficult time accepting that and, therefore, look for the snake in the grass.
Reference to FRA documents, PRIIA studies, etc. that are more than five to seven years old does not tell how Amtrak accounted for its activities in FY2013.
sam1 was a corporate accountant. What are your credentials to stand in judgement? And BTW, it is pseudo+whatever.
Kevin C. SmithAs an annual LD rider, I am fortunate that I have never encountered CMStPnP's listed problems (though my trips have been confined pretty much to one route), with the exception of the "fill out your own order" dining car tickets-which, I believe, predates Amtrak.
Going to go off topic a bit here to explain a few things....
I am more picky than others because I travel every week, usually via Airlines. Sometimes I fit in Amtrak when I can (NE Corridor) I did have a pleasant experience on Amtrak's Southwest Chief a few years ago on a Chicago-LA trip. Amtraks NE Regional, no issue either except for the over crowding (Hiawatha Service with plenty of seats has me spoiled).
I've been complaining regularly to American Airlines in the last month because their IT systems have gone to hell in regards to their internal accounting and individual website display. TSA-PRE CHECK was not printing on the boarding pass for example (got them to fix that). Recently they have been charging me (actually my employer) for Checked Baggage Fee, the problem is that I have their CC and they are supposed to give me Group 1 boarding along with one bag free. Someone screwed up their internal IT systems and they have been trying to fix them the last few weeks. Also, last 6 American Airlines flights I have boarded in either DFW or ORD have been up to an hour late departing, always due to mechanical isssues. So Amtrak is not my only whipping boy in the transportation field and I don't feel I am being unfair necessarily.
Interesting to note, my employer pays more for American tickets than most of the readers here because that's how airlines make money (gouge the business traveler), cheapest ticket to ORD is over $450 from DFW and to other cities it is not unheard of to pay $1275 RT for a coach ticket on American because the ticket is refundable. What's weird is the flip side is true of hotels. I pay generally less than you guys do for a hotel. Full Service Hyatt Regency here in the Chicago area I am paying $83 a night, you guys would pay $129-189 a night. So overall it is a wash between hotel and airfare. Rental Car firms, again, gouge the business traveler so they can cut rates to the tourist....just like the airlines. Rental Car for approx. two weeks, employer pays $800-900 for a intermediate sized car. No way would a tourist pay that much.................now back to Amtrak fares.............they seem to giveaway to everyone, I have yet to figure out their structure or yield management approach.
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