Looks like the ‘California Dreamin’ for their HSR connection between San Francisco, Bakersfield, and Los Angeles, is getting more expensive and slowing down. [wow]
FTA:"…The price of the California bullet train project jumped sharply Friday when the state rail authority announced that the cost of connecting Los Angeles to San Francisco would be $77.3 billion and could rise as high as $98.1 billion — an uptick of at least $13 billion from estimates two years ago.
The rail authority also said the earliest trains could operate on a partial system between San Francisco and Bakersfield would be 2029 — four years later than the previous projection. The full system would not begin operating until 2033…"[banghead]
…And with exactly that kind of project management and cost forecasting, this state wants and thinks it can run independently…he-he-he. Not likely. It was too ambitious of a project for the state to take on by itself with little in the way of Federal Guarantees. Now they are faced with some very hard choices.
I read the Governor promised that no less than $40 Billion of the cost would be covered by private investors. For what kind of returns on that massive capital investment? California has to offer something to a private company besides a meager share in ticket revenue. Nobody is going to spend that kind of money otherwise.
Look at Brightline. They have a share in a lot of the RE development on top of whatever they sell on tickets they still have to go to the Junk Bond market to obtain financing because nobody is going to spend $2-3 Billion on a first time risk investment with no real prototype. It is very high risk. $2-3 Billion is nowhere near $40 Billion but $2-3 Billion is a possibility when FEC has already spent $1 Billion and it can possibly show results from that investment. $40 Billion in private funds before any part starts up and no real template for results or returns. It’s complete fantasy.
Every rail new build or revision seems to always underestimate the problems getting new ROW and various permits. That streaches out all timelines greatly.
Sometimes I think it’s deliberate. They get the lowball estimate approved, then, “Oops, we underestimated, but since we already got this far, we need just a little bit more so that what we did so far won’t be a waste.”
Along with the idealized artist renderings depicting a finished product so grandiose that no one could afford them. Then, once completed to a lesser spec, blame reality on the unwillingness of the public to support the founder’s vision.
Every good scam artist needs a talented artist to produce renderings. Paper being so much cheaper than brick.
You need to remember this is CA the same state that spent 3 billion at last count in taxpayer dollars to try and save a 2 inch fish. The same state that had 150 million budgeted to fix a dam spillway but thaat wasn’t even enough to cover the EIS for the project. The same state that an apartment with less than 800 sq feet in it goes for 4 grand a month in the Bay Area and they wonder why people are living in tents.
Don’t forget that the artist’s rendering also shows hundreds of people using the facility. Oddly, the humans are usually drawn as hybrid, human caricatures.
Air travel from San Francisco to Los Angeles is about 1:30 hours. Add to this check in including safety plus baggage claim.
The train is designed to do this in 2.40 hours. Sounds quite competetive. And if not for the final destination at least from the intermediate stops like Merced, Fresno etc.
I read somewhere that the ticket price was planned to be about 50% of the average air fare. That would be more than the lowest fare but you get much more comfort and a more comfortable travel.
Private equities want invest in such projects. The are too long term for their liking with too many imponderables over the run. One of the economical success of the train. There are other economical benefits like economical growth that equities won’t participate in.
regards, Volker
Given the escalating estimates of the final cost of the project, which doesn’t include debt service, it is unlikely that the initial estimates of the average ticket price will not also escalate.
If the primary objective of this project is to provide commercial carrier service from LAX to SFO, the airlines probably could meet the foreseable demand by using larger airplanes. There are lots of wide body airplanes on the used airplane market that can be bought cheap. They could be configured for the short haul market.
Moreover, the cost to inhance the gate areas in LAX and SFO would be much less, I suspect, than the cost of the California High Speed Rail Project. And as is the case in short haul markets, many if not most people carry their luggage onto the airplane. With TSA pre-check the amount of time required to clear security has been reduced significantly.
If the objective is better rail service up the central valley, upgrading the existing rail lines to 125 mph might have been a better option. For example, Fresno to San Francisco is 188 miles. Merced to San Francisco is 131 miles. A train that averages 95 to 100 mph would be an attractive option to driving and/or flying between these points.
Seems to be pretty much in line with the preceeding Thread comments. At the risk of getting a ‘talking to’ by the moderators: California, and its politics, certainly provide some interesting information, and a decidedly, different slant on how things seem to get done out there in ‘The Golden State’ [sigh]
Well, I was going to comment but, except for Volker, you have all said it better than I could. Let the people vote again. If they approve this boondoggle again then they deserve what they get. But maybe this time saner heads will prevail and they will see that this whole thing is a scam that will only enrich the lawyers and the construction contractors.
Perhaps we are not so far apart as you think. I argued that HSR can compete with air travel on the SF to LA relation.
And there can be benefits for the state beyond the pure train revenue a investor wouldn’t benefit from. If that is good enough to proceed with the project at the risk that the trains run at a deficit is a polital question.
Being a German and living there I try to keep out of American politics. But being socialized with functioning rail passenger system, long distance as well as commuter and regional I am biased. From Hamburg to Stuttgart, the same distance as SF to LA, I would never fly though the train takes two more hours.
American railroads don’t lend themselfes to updates to 125 mph. With the American way of running freight trains, long and slow, this would just enlarge the problems Amtrak has with its long distance trains.
So if there is a political or public will (and there was during the Obama administration) separate tracks are the best solution.
Regards, Volker
Here is a significant difference between Germany and the U.S.
According to the New York Times, government debt in Germany has shrunk from 79.9 percent of GDP in 2012 to 68.3 percent in 2016. U.S. government debt, which stood at slightly more than $21 trillion today, is approximately 109 percent of GDP. If intragovernmental debt is backed out, the U.S. public debt is approximately 80 percent of GDP. This is the highest public debt to GDP ratio since WW II.
It appears that Germany has a better handle on its government debt than the U.S. If this is true it has more government direct or backed resources to promote passenger rail. On the other hand, the U.S. is running out of resources to fund passenger rail or general infrastructure improvements.
We had a public discussion that we are loading the government debt onto the shoulders of unborn generations. As a result new indebtedness got limited to 0.35% of GDP with exeption for catastrophes in our constitution. We had a balanced budget in the last few years and to keep this is the long term goal.
On the other hand public transportation is a service for the public defined in our contitution too.
When Deutsche Bahn started HSR they were able to update trackage already certified for 100 mph. A lot of our HSR trackage is still track updated to 125 and 155 mph. Were necessary special real HSR lines were built.
The relation Hamburg to Stuttgart is about the same length as SF to LA but takes about 5.5 hours for the above reasons. It is still competetive with highway and air travel.
Regards, Volker
