Immediately or almost immediately after Amtrak began they also began to replace the ties and tracks in the northeast corridor. The old ones were wooden ties and stick rail. The new ones were concrete ties and continuous welded rail. That was done many years before Acela.
Between New Haven and Washington the tracks were electrified by the original railroad companies. However, at New Haven trains would have to change engines from electric to diesel and vice versa. The change took about 20 minutes, long enough to run into the New Haven station and make a phone call in the days before cell phones. In the 1990’s the tracks were electrified north of New Haven so they must have had Acela in mind. Of course, the Northeast Regional trains also benefited as they no longer had to stop to change engines.
All of the reports I have ever seen, Sam, say that Acela is the most financially successful train that Amtrak operates. It is more successful than Northeast Regional Service. If the speed were increased it would be even more successful. As long as Amtrak exists getting rid of Acela would increase subsidies needed for Amtrak.
It is precisely Acela’s success that Amtrak critics criticize. They argue that government has no business operating a successful business; that is reserved for the private sector and Acela should be turned over to the private sector for exactly that reason. Amtrak should only operate those services which must operate at a loss.
It seems to me that those same critics then happily turn around and criticize government for being inept when the things run by government aren’t profitable.
As a society we long ago passed the point where we can function without good communications, for transporting goods, as well as people.
To believe that private interests, with private money, focused on the numbers to report at next quarterly shareholder meeting, will regularly invest in infrastructure that will serve for the next 50 years, seems rather naive. They will of course look at the short-term picture.
We would not have a nationwide interstate road system if that had been left to private capital. We would have corridors of toll roads where those could be built and attract enough traffic to pay off the investment and generate profit in the near term. Other modes of transportation would have had similar development. How many airports would there be if it was all up to private capital?
BTW, I am not at all in favor of a system where the government runs everything on 5 year plans or similar. I do think there is a way to balance public interest and investment for the common good with private capital and interests.
Why is it irrelevant when you are ignoring or minimizing the fact that Acela more than covers its operating expenses and you now seem to be bringing up the federally paid for ROW and upgrade in the NEC? Let’s compare apples and apples.
Consider the way the airlines price business travel. They may wine and dine a corporate travel department, but a decision to travel made at the last minute or a need to change plans leave the business traveler paying the maximum for that flight. An additional problem for the carrier is that payment for the business flight may be as far away as 60 days if it is charged to a corporate account, while the individual traveler pays through a credit card that is processed before the flight occurs, sometimes by weeks.
Is the business traveler discount offered by Amtrak on Acela adding passengers who would otherwise drive, fly or Megabus? I have my doubts.
Amtrak was recently struggling with the decision to add Acela cars to the existing trains or ordering additional trainsets. That suggests they are capacity constrained or anticipate being so. Perhaps the corporate travel departments should be wining and dining the Amtrak reservation personnel. [:D]
Virtually any and all businesses offer discounts for bulk buying, so why shouldn’t Amtrak? You have to understand business, advertising, marketing, etc. to run any business, passenger trains included.
If discounts fill otherwise empty seats, cover the variable costs, and contribute to the fixed costs, offering discounts is an effective business strategy. If these conditions are not met, discounts are a bad idea. Without access to Amtrak’s books, we don’t know whether the discounts are an effective business strategy.
If a competitive business offers discounts and the aforementioned criteria are not met, the shareholders take it on the chin. Amtrak, however, is not a viable business. If its discounts fail to meet the aforementioned criteria, the taxpayers wear the consequences.
As of the end of Fy12 Amtrak had accumulated losses of $29.3 billion. If the numbers are restated inn 2012 dollars, the accumulated losses would be north of $40 billion. Amtrak should not be offering discounts or services that acerbate these losses.
No…discounts are offered upfront when it is a known factor, i.e., a guarantee minimum amount of money to be spent or milage or whatever the criteria…it is money in the bank, it can be used as collateral, bookkeeping and transaction costs are minimized, etc. Buy a doughnut, buy a half dozens, buy a dozen and each price per unit is different. Seat discounts at the last minute to fill seats are different than bulk, long term discounts. If one knows business, selling, etc. then it makes sense…and dollars, too.
One wonders then what level of annual losses would be acceptable for Amtrak?
Or would it be your contention that if Amtrak can’t be run at a profit, considering all possible and sundry expenses that can be charged to it, it should not be run at all?
This is a round robin, merry-go-round argument based on one’ s political bent and proclivity to highways and oil lobbyists. Basically, Amtrak, as legislated, cannot do anything. It cannot make a profit because Congress is not a railroad organization and its members are not railroaders; it is another government agency designed to keep people occupied in a never ending bureaucratic mess. It cannot make a profit because, I don’t think railroads want it to in fear they’d have to run passenger trains thus Congress will keep it that way.
Stolen? Oh, too low a fee? Perhaps the freight lines would prefer to turn back the clock and be required to run a real passenger service as mandated in their original charters? I doubt it. Perhaps what we should be considering the freight lines selling more of their lightly used lines to the states or Amtrak for routes that would be desirable. It would reduce the freight lines’ minimal maintenance expense and property tax burdens.
The past post about Amtrak wanting more seats on Acela is very tellling. The decision to acquire more units seems a wise decision to instead go to the next level of equipment. That does pospone additional seats by Acela-2s for 2 - 3 years.
As others have posted here some schedule times for Acelas are almost always sold out. Those same time frame Regionals Business class appears to be sold out many times. So business class & first class Acelas at certain times seem to need more seats. Those riders IMHO are very time sensative so probably charter a limo, fly, or drive.if no Acela reservation available. That is lost old & new business. After a few times trying to get a seat at those same times they may give up on Amtrak.
The reduction of schedule times both for Acelas ( less than today ) & Regional trains to current Acela times may attract many passengers mainly to Regionals ? Once enough ACS-64s are in proven service maybe Amtrak can use them + double headed AEM-7s to add another 1 or 2 Business class cars to Regionals?
Perhaps more Acelas and regionals in the peak time periods? Acelas are on the hour from NYP to DC, with a regional 10 minutes later. Why not on the half hour as well, from 7 to 9:30? If they can manage 10 minute headway, even more frequent during peak demand times.
My point is that freight railroad management fears that if passenger trains ever make a profit, especially via Amtrak, then they will be forced into looking at and running passenger trains which they fear is the worst thing that can happen…either because a scheduled passenger train interferes with their freight trains, or because it brings people onto railroad property which can be a liability should something happen, or because their attorneys have scared them silly
Railroad lines can carry freight, those lines can carry passenger, or they can carry a combination of the two. Railroad lines, however, are a resource with limits to capacity that cost somebody money to provide, whether it is a private railroad company, the government through funding to Amtrak, or some partnership between the two.
A famous NARP talking point is that one track has the “capacity of 20 lanes of highway.” I know this because I was a NARP member 40 years ago, and when my high school had an Earth Day exhibition, I set up a table with a section of track with an HO RDC car to illustrate one track, and I set up some cardboard to show the relative amount of space of 20 highway lanes taking up that much precious Midwestern farm land. The guy next to me had read Paul Erlich’s book and had a poster explaining how exponential human population growth is going to choke us out like that one Star Trek episode on overpopulation.
Now that may be true if you are talking about a double-tracked, closely spaced signalled, subway line of passenger trains carrying standing passengers where the trains have all the same good acceleration
Irrespective of when they offered, for whatever period of time, if a business offers discounts that don’t cover the variable costs and the fixed costs or at least make a contribution to the fixed costs, it ultimately goes out of business. It is a relatively simple accounting problem.
One would think so. But there are plenty of examples of selling loss-leaders, on the premise that the customer who buys the item sold below cost (such as a Kindle), will buy other products from the same seller and so overall generate positive income for the company.
That said, I remain confused about what you really want to happen to/with Amtrak. Much of what you state seems focused on them not covering costs. So then they should charge more. But then you are questioning their premium products as well, even though the price point is higher there, with more positive return for the company.
I want to see a functioning passenger rail network in the US that is a viable alternative to other modes of transportation. I am willing to pay for that, from taxes and from tickets. In a perfect world, maybe it’s possible to run passenger rail for profit, but I’m not sure. And we don’t live in a perfect world. I do believe it is in the interest of federal, state and local governments to ensure that people have multiple options for travel as travel furthers commerce and generates income for the community at large.
I am also aware that in its current highly politicized form, Amtrak, is not able to be all it can be or should be. I think they are missing in some areas, but they are doing a great job in some other areas. And without Amtrak, there would be no passenger rail in the US today, aside from some rapid transit.
One basis for a quantity discount is that the “seat” is just a bench in a glorified boxcar, but the expensive part is selling the ticket and then having the conductor “pull” the ticket.
That is the basis for the term “commuter.” You don’t commute by automobile – that is a change in the original meaning of the term. If you were a regular traveller between Point A and Point B to go between home and downtown job (back in the day, this was probably executives who lived on exurban estates and rode daily to downtown jobs at corporate headquarters), the railroad company “commuted your fare”, that is, gave you a volume discount.
For example, on the old C&NW, when I worked a summer job on Madison Street near Northwestern Station, I bought a monthly pass at a discounted rate of the individual fares. I bothered the station agent only once a month to purchase this pass, and the conductor just glanced at it coming down the aisle.
During the school year, I “commuted” to Northwestern University (no relation to the Northwestern Railroad), getting on and off at Davis Street, Evanston, which was a good 20 minute brisk walk in whatever kind of weather. Since I was not going all the way to Northwestern Station, no commuted (or commuter) fare was offered.
Actually, the whole thing was kind of stupid. C&NW gave a discount to customers who travelled during the rush hour and got off at Downtown. As a student, I was often travelling off-peak, and by getting off at Davis Street, I freed a seat at Davis Street for a Downtown commuter. I was off-peak both in time of travel and travel segment (the seats fill up as you approach the Downtown terminus whereas the train is mainly empty at its remote North Line terminus), but I got no discount.
Think about it – the “commuter train problem” is that you have the morning and evening rush hour, which is hard to bridge with a single crew shift, and y
Of course we are talking business professionals and not amature model railroaders. If a discount is offered or negotiated it will be with a profit for the railroad; no business would sell its product for breakeeven or less! It is a relatively simple rule of business. No body at Amtrak is an amature nor a non business person. If they did as you suggest, Sam 1, they’d be out of a job and the company out of business.