US DOT shuts dow 26 bus companys and subsiditaries. Many rules violations.
http://fmcsa.dot.gov/about/news/news-releases/2012/I-95-Bus-Release.aspx
Wonder how this will affect amtrak ridership?
These are by and large bus companies who have numerous citations and with drivers with numerous citations and comes in the wake of the many disasterous accidents over the past couple of years. Many of those named were well aware the sickle was enroute.
The bus companies that are the subject of the DOT action violated basic safety rules and need to be taken off the road. I doubt that it will have a significant impact on Amtrak’s ridership. However, an event is unfolding in Texas that could have a significant impact on Amtrak’s ridership here.
Megabus is introducing express bus service in Texas beginning June 19th. It will offer non-stop service from Dallas to Austin, Houston, Little Rock, Memphis, Norman (OK), and San Antonio. Megabus will use 81 passenger double decker buses with wifi and reserved seating. Introductory fares will be as low as $1. Regular fare are likely to be in the $12 to $25 range. They are substantially below Amtrak’s fares. Greyhound is offering similar upgraded service between Dallas and Houston as well as Dallas and San Antonio and Austin and Houston. This does not augur well for expanded passenger rail service in Texas.
Megabus started a hub in Atlanta about 6 months ago. Although the seats are reserved, they aren’t assigned. It’s “cattle drive” style loading. Still, the 20-somethings love it. Hasn’t effected Amtrak, because Amtrak really isn’t competition on any of the routes out of Atlanta except Charlotte and New Orleans.
Shortline/Coach USA introduced Megabus to Upstate NY a year or so ago with fares as low as a buck, too. Of course it is selecte bus schedules like pre dawn departures, not busy times, ticket purchase well in advance of date of travel, etc. It does not seem to have much of an impact as both it and Greyhound seem to be running without touting the Megabus fares. I doubt it will interefere with Amtrak even in Texas if for the only reasons that people must plan well ahead of time and those who wouldn’t otherwise be able to afford full fare jump on for a buck before others have a chance.
It could have a major impact on the Eagle and Heartland Flyer. These are once a day trains that are not a serious travel option for most people. Megabus, on the other hand, coupled with Greyhound’s improved express schedules, will offer numerous departures throughout the day. Moreover, the bus (Megabus and Greyhound) runs from Dallas to San Antonio in approximately 4 hours and 50 minutes. The Eagle takes 10 hours and five minutes and costs nearly double the proposed fares on Megabus.
Had Amtrak focused on developing corridor service between Dallas and Houston and San Antonio, where passenger rail makes sense, instead of wasting billions of dollars on long distance trains, we might have had a competitive passenger rail system in Texas. Unfortunately, Amtrak is a government agency that responds to political pressures more-so than market forces. Megabus and Greyhound are market competitors that respond to markets. Time will tell, of couse, but they are likely to take away most of the DFW to San Antonio Eagle passengers.
Detroit-Chicago has had a Megabus route for the last 6 years, but Amtrak had a record year last year in Michigan. Also, not all Megabus launches have been successful, as their LA hub was shut down.
Megabus may be serving a new demographic. A study has shown there has been a decades long decline in young adults getting drivers licenses. Those 20 somethings who like the free wifi might not have a car these days. The study was cited in another thread:
Your answer, Sam, begs the question of if Amtrak were a private corporation or if a private railroad itself really wanted to move passengers, could the free enterprise system, entrapeneurship, be enough motivation to properly market and operate a passenger train service. Unfortunately the answers are rife with political overtones and impractical romantic pangs of days gone by.
Had the government not stepped in to preserve a skeleton intercity passenger rail service, most of it would have gone away in 1971 or certainly by 1975. Possible exceptions might have been New York to Philadelphia and Washington as well as LA to San Diego. No one knows! What we do know, however, is that Amtrak has cost the taxpayers more than $28 billion dollars in accumulated losses since its start-up in 1971. And this does not take into consideration the additional forgone revenues because Amtrak pays no taxes, i.e. property, inventory, sales, or fuel.
My fondness for passenger trains is offset by my fondness for not wasting the taxpayer’s money on commercial projects that cannot stand on their own in the market place, especially given the fact
Henry,
You know that no private entity forced to absorb the capital costs required to provide credible passenger service would be crazy enough to try it. It is too **** expensive.
On the NEC, where ATK has total control, there are billions in defered maintenance and delayed capital improvements. Where ATK operates on freight carriers it pays no where near the cost that it imposes. ATK is a continuing burden and imposition on the freight carriers.
Mac
You may have a point. Megabus stated that it expects 40 per cent of its ridership in the Texas Triangle, as well as to Norman, OK, which is the home of the University of Oklahoma, to be college students. In fact, its Austin stop is on the University of Texas campus.
According to the initial schedule, Megabus will offer eight trips a day each way between Austin and Dallas and 14 trips each way per day between Austin and Houston. The trips will be nonstop. Accordingly, the service will not impact the number of passengers using the Eagle from the stops between the major cities that it serves, i.e. San Marcos, Temple, Longview, etc., but it is likely to draw passengers away from the train in San Antonio, Austin, Dallas, and Little Rock.
Mac, in the back of my mind has always been the feeling that getting out of the passenger business, especially here in the U.S., was the easy way out, too easy. Entrapeneurship said that more money could be made moving freight, so the hell with people. Thus all energy of manufacture and marketing went toward moving inanimate things in railcars instead of people. And it was an easy decision because the highway lobby was working against them anyway, so the government, or rather the politicians in government, went the popular way and supported the highways and automobiles. This, of course, made it much less expensive not to take the train but rather the family car. As for airline competition, the railroads gave a little try but once they saw the major change there, coupled with the profits to be made in moving freight, they no longer had to try to market a passenger train.
But I am also one to say this is where we are today, we arent’ back then, so our answers and solutions have to be based on today’s conditions, not 1955’s or whatever. That is why I often say, though, that our transportation system and policies have to be reviewed and revised from outside the box, almost like starting from the beginning with credence to the value of each form of moving people and freight being considered and then “build” a new system.
The concept that Megabus will do the long haul nonstop while Amtrak fills in with service at intermediate points offends my sense of a properly ordered transportation system. Oh, well, nobody said the “system” has to be entirely rational!
Still, Dak, when one thinks about it …
The bus has (usually) the faster right of way, and is not burdened with the “all things to all people” mandate of most Amtrak routes with their single pair of trains a day.
The surprise to me is that it took the bus companies so long to figure out and exploit their advantage. Looks like they’re doing the same thing in Iowa, smothering the nascent Rock Island revival in its little cradle.
The biggest threat to Amtrak yet?
I don’t know how they are doing with the Megabus concept anyplace. However, it is an attempt to fill empty seats and especially so on the pre dawn and reverse moves which would otherwise be deadhead runs if only in part. Like the early supermarket concept of being open all night: as long as there was a stock crew and the lights were on, might as well leave the doors unlocked. I am not sure this buck ticket isn’t a test of the demand marketing airlines and Amtrak do: price actually goes up the closer to departure time; if they aren’t doing it now, they soon will be.
Frequent, fast, convenient, comfortable, and dependable bus and discount airline services are a threat to the once a day long distance trains, especially for coach passengers. BTW, coach passengers make up more than approximately 95 per cent of Amtrak’s riders.
Interestingly, Megabus has teamed up with the Kerrville Bus Company t
Surprisingly, Sam1, you and I concur and agree on more than I thought! And your final sentence about politics of transportation is the main problem we face. It is why I keep pounding away on the concept of starting from scratch, plan as if there is not system or systems in place; confiscate the highways and their users, t
The Federal cross subsidy for the entire interstate highway system for intercity travel is at least $0.08 per automobile vehicle mile at aaa corporate bond rates, not WACC, just bond rates from construction to today. The government borne accident costs are at least $0.02 per vehicle mile. The Class 8 truck subsidy is around $0.30 at aaa corporate interest rates, $0.60 at WACC, as the railroads pay.
Between these two you have the answer to passenger operations and infrastructure expansion in the rest of the country outside the nec. Send me an email and I will send over the working paper that shows so from the FHWA’s numbers.
The losses and expenses that Sam1 mentions seem huge. But if passenger rail had died the “natural death” that Sam1 thought appropriate, the losses and expenses to the USA in general would have been astonomically higher, with far great hightway and airport expenses and land requirements that would have just scratched the surface in some areas in resolving the additonal congestion and delays that this “natural death” would have caused.
Sam1 can possibly be quick to respond, “Yes but those are the corridor operations where I agree rail passenger makes sense. But not the long distance trains.”
Absolutely true. But very very unfair. For the USA economy to function properly, the big city commuter and the corridor business and vacation traveler must be subsidized. But I claim that subidizing the weekday commute of the businessman/businesswoman, or his/her weekly corridor trip, and not being willing to subisidize the once-in-the-lifetime trip of the highschool or college graduate to see the USA coast-to-coast and the yeary trip of a handicapped wounded servieman to see his family is grossly unfair. And why should an Illinois farmer subsidze a Peoria - Chicago corridor service mainly for busineesmen if he cannot travel comfortably by train to his extended family on the West Coast.
Take away the national network and the corridor costs subsidy costs will climb.
Dave, you bring up an interesting phenomona in American business overall, not just rail passenger service. It used to be that a company had a product which did not earn them money directly to the bottom line but kept the whole operation alive somehow; maybe it kept the company name in front of the public, maybe it kep a factory or an assembly line alive and ready for the profitiable stuff, maybe if fed a by product to the main product or took a by product and sent it out to the public. In railroading, I likened branch lines to tributaries of a river…the more tributaries, the bigger the river got; but take away the tributaries and soon the river dried up. Just like railroads eliminating branch lines, mainlines got less traffic and less traffic often meant less profit overall. Similarly passenger trains from A-Z lose when the feeder lines and intermediate stops are eliminated or the connections at either end are gone. Bottom line CPA’s and investor bankers don’t line to see an operation not put checks in thier pockets even if it is what helps keep the whole operation afloat at the cost of a fraction of a penny.