One of the things I’ve been searching for years was the profitability of Penn Central’s Metroliners. I’ve never found anything until this week. And I discovered a mother lode of more than the PC Metroliners.
Although not exactly pre-Amtrak it shows profit (loss) by every single train number as billed by the railroads for Amtrak in its first 2 months of existence May and June 1971. (Just May for PC as they hadn’t sent the detail for June by the date of the report.) The report was from the ICC to the President and Congress on the effectiveness of the Amtrak act. I doubt it was intended for public consumption and Amtrak has never released anything like this.
It does not include any Amtrak overhead allocations or adjustments because there weren’t any in these numbers. It’s as billed by the railroads to Amtrak. Amtrak in it’s first few months of operations had only a handful of employees as noted in the report. Probably just an accountant, lawyer, president, secretary, and treasurer. All operations, revenues and expenses were handled by the railroads. Amtrak’s sole role those first few months was to collect grants from the government and disburse reimburements to the RRs.
Just about the only trains profitable were the Metroliners. And they were pretty profitable too. About $1/2 million in total for May 1971. That’s serious coin. Virtually all of the rest lost money. $12 million in total for May 1971.
The only thing that kept passenger service close to being even break even in the 50s into the 60s was the mail contracts that the railroads had. When the postal service removed the mail from the passenger trains they literally became red ink machines.
But I’m surprised at how profitable the PC Metroliners were. It pretty obvious that high speed frequent service in a populated corridor could make money.
PC invested a little over $50 million in track, catenary, high level platforms, and the cars. Generating a 1% return a month is pretty good.
This makes me realize that Amtrak is probably gilding the lily on their Northeast Corridor. Their infrastructure costs are too high.
I read a Financial Times article that basically acknowledged that the US and UK spend multiple times on infrastructure per mile as the rest of the world. Not just rail. Roads too. Tunnels. Bridges. Everything!
Remember, PC was bankrupting itself with every train that they and Amtrak operated. Whatever expenses PC allocated to ‘maintenance’ of the tracks Amtrak operated the Metroliners upon was in fact a deferral of real maintenance to the track structure. To compare today’s Amtrak maintenance expendures on the NEC with PC’s expenditures is laughable.
The Congress Magnuson did a deep dive into the PC bankruptcy and stated that passenger losses were not a very significant reason for the bankruptcy. Yes it contributed but even without pax trains it concluded they would have gone into bankruptcy anyway.
In addition to pax losses the report blamed in no particular order the ICC (for stifling competition, outmoded accounting practices especially on depreciation, and extremely slow rulings on rates, mergers, abandonments), management (for being incompentent and untruthful in financial reporting), labor (for outmoded wage structures and work rules), overall NEC economy (region was in a severe decline relative to rest of US), and even themselves (for bad public policy and neglect). It’s a huge report but the best I’ve read on the PC debacle. Most books on subject were a rehash of newspapers, little insider info. The SEC’s report was way too dry and full of accounting jargon (and I’m a CPA!).
Don’t really understand your comment on maintenance. Are you saying PC spent too little or that Amtrak is spending too much? Cheers!
PC spent ‘so much’ on track maintenance that they experienced a number of derailments of trains that were standing still. Weight of the train turned the rail over because the poor condition of the ties would not hold the spikes that kept the rail in place on the tie plates.
PC was woefully inadequate on the maintenance they did. They made the following video
I’ve seen that vid. Yes I know PC spent very little on maintenance on many lines (like in the midwest, I live here, I remember it well) but I was referring only to the NEC. Sorry if I wasn’t clear.
As far as I can tell they kept up the NEC pretty good. Not great but good enough to keep it class 6, 100+. I rode the metroliner NYC-WAS in the 70s, had family in both, once next to the cab south of Wilmington. I was previously in the rear vestibule timing mileposts. Conductor said would you like to see up front and took us there. I stayed there until DC. They wouldn’t dare do that anymore. He was tooling 105-110 per speedo.
FRA standards went fully into effect Oct 73 and PC even raised track speeds from 100 to 105 in 74. Originally in 1968 employee timetable PC was max 110 and only for the Chesapeake Division Delaware-Maryland, rest 100. Raised to 120 in 69 when nonstop service started requiring the higher speed. Nonstop was not successful and they pulled it 1970 and lowered mph to 100 everywhere.
In case anyone is interested all 11 PC NEC employee timetables can be found here:
Not to mention practically all PRR ETTs from about 1900 on. Must be several hundred listed.
But my earlier comment that the PC spent $50 million was on capex improvements, not maintenance. That was a bargain to get from an 80 mph road to a 100+ railroad.
BTW what do you race? I saw it in another post. Sounds interesting.
From 1972-1977 I was a Asst. Trainmaster for the B&O at Bayview Yard - immediately adjacent to the NEC and the PC Bayview Yard. Observably the Main Track conditions I observed showed a steady decline.
Racing - I raced for 35 years in the Sports Car Club of America’s Formula 500. Small open wheel road racing cars powered by 500 cc two stroke snowmobile engines with the snowmobile CVT transmission. Engines put out 100-110 HP top speeds at the fastest tracks exceed 140. Raced up through 2022 when I ran up against an electrical problem with the engine that is in the car - after I had towed from Maryland to Topeka for a race weekend - was warming the engine up on Friday evening for Saturday’s qualifications and races. Engine stopped and hasn’t fired since and ever electrical component has been changed. Frustration to the max. Kept trying to get it running and then I developed that Erie disease - Lackawanna. In that interim COPD overtook me and I no longer have the endurance to participate driving.
Cool. I have a distant relative that does the same. He says it’s a blast and relatively affordable. It sounded like a lot of fun.
He works at GM as their manager of tire research in Michigan. Basically specs all of their tires. He swears by Michelins. I like Pirellis and he said they’re in the next tier. Michelins to him were a class by themselves.
I’ve only met him once at a big family reunion and I’ve completely forgot his name. My in-laws have a huge family. I mean hundreds at that reunion. Looked like that big fat Greek wedding movie.
I accept your observations on PC. Wonder what the hell the FRA was doing. They could do a snap inspection in their lunch hour lol.
Wonder why some Metroliners cost less than $50000 a month and others cost more than $80000. Four-car trains vs six-car? But then there wouldn’t be all the in-betweens.
In addition they had cafe cars with variability. Can’t speak for Metroliners per se but for other pre Amtrak trains dining costs less any revenues were charged against costs.
Crews might have had different rates of seniority. Also might have charged repair costs by train.
Oh. One point I may have overlooked in my original post. The billings to Amtrak only included avoidable costs. Not fully allocated. The government was not about to support a portion of railroad HQ overhead that it would still incur even if pax trains were dropped entirely.
