Like the subject line says.
What would it take to get one of the Class I freight companies to get back into passenger rail?
An Act of Congress.
The prospect of making a decent profit on the operation. Highly improbable.
Short answer: a great deal of money. Having gotten out of the business, it would take a tremendous expediture to get back into the business. Not just cars and locomotives but crews, supervisors, administrators; platforms, stations, yards, shops; signalling and track upgrades, and dispatching. Unless the potential return is greater than what the company is already making on freight, they will be better off just sticking to their existing investments in freight handling. Any market that big would probably attract an outside operator whose specialty is passenger traffic and to whom the RR is one of the contractors.
You have to have at least a 20%+ return on investment for them to consider, IMO.
Canadian Pacific is already in the luxury train business and they are a Class I. However they have to be making a decent profit on that service to remain in it and justify it to their stockholders. I think at some point CP will tire of the operation and either sell it or stop it entirely.
A long time ago Kimberly-Clark a large paper products company saw that it had a small fleet of company planes and was shuttling a lot of employees back and forth between the paper mills in Wisconsin and Corporate HQ in Dallas. Someone got the idea to start an airline based on that base traffic and they named it Midwest Express airlines. Eventually, Kimberly-Clark tired of the operation and sold it off…later it went bankrupt or merged away (not sure which). Hence I think CP will do the same thing. I would be really surprised if they bought more equipment and expanded.
The opportunity to use the passenger service to make a huge amount of mney on something else.
Lke All Aboard Florida is expecting to do with real estate.
An Act of Congress deeding the keys to the fully filled Fort Knox gold depository vault.
I have heard over the years that the freight railroads hadn’t covered solely-related passenger costs collectively since 1953, which goes a long way in explaining why Amtrak was established. It also explains why they are in no hurry to get back into the passenger business.
For sure, an Act of Congress, but it will never be Class 1 freight railroads.
It would have to be part of a government funded hi-speed rail network, maybe in the next century.
Rich
That ship is starting to sink, if you Google the subject matter recently. A number of highly critical and doubtful articles about it’s future success have been published in the last 10-15 days in prominent Florida publications.
Psst: Don’t tell schilmm, he will say he told us so.[:#]
Amtrak, according to Federal law, holds a monopoly “concession” on intercity passenger trains. For a Class I railroad to reenter the passenger business, dunno, because Mr. Buffet is feeling “lucky”, would require passing a new law.
Well, I believe I pointed that out to Dave long ago, as did others. And as to the title question, looks like you and four others agree, that for 2 reasons, it will not happen.
Paul, are you sure about the “monopoly ‘concession’” part? I always understood that Amtrak was an “opt-in”, allowing (but not forcing) railroads to escape the passenger portion of their common-carrier obligations by joining. That is why Southern, Rio Grande, and Rock Island could choose to not join initially, and why some smaller roads can now offer scheduled passenger service (such as Saratoga and North Creek, or FEC’s proposed All Aboard Florida).
On the other hand, I have not gone over Amtrak’s enabling legislation anytime recently, so I could be wrong.
In today news section it was pointed out that privatized Japanese rail companies earn a significant portion of thier earnings from non rail segment’s of thier business including hotels, restaurants and real estate. Hard to make a profit even with high speed rail in Japan.
This is true of the rail cruise operators in Canada. They make some offsetting money with the add-on packages and the upscale accomodations. Hotel bookings, bus tours, gifts sold, etc.
Cruise Ships make their money on the booze sold on board, their off shore trips, the gifts they sell on board, their side trips, etc. Not unlike the rail cruise operators. Seems to be they follow similar models.
My on board ship account is always more than my ticket price.
Around Tokyo, several private electric railways were built to bring customers from the hinterland to the railway owned department store (Which was always located adjacent to a major JNR station.) The commuter traffic was just gravy.
Actually, the railway/department store was a chicken/egg question for Seibu and Tobu. The same holding company owned both the store (with restaurants and other amenities) and the rails.
Chuck (former Tokyo resident)
Even if you could wave a magic wand and make passengers marginally profitable, their trains would be disruptive of the slow-but-steady freight that is the bread and butter.
Rail plant, traffic and operations have so changed that the 1950s some of us remember so fondly – when half the miles run off were passenger miles – ain’t coming back. Ever. We’ll be doing well to hold onto the Amtrak that we have.
For a passenger-only, high-speed operation run by the government or governments, the 22nd century suggested by another poster sounds about right.
So a little off topic here BUT…
I am curious that if railroads go to electronic braking how much that might improve the safety margin of both higher speed frieght trains and higher speed passenger trains expecially on lines that have PTC installed.
Also, curious if higher speed freight will ever kick off the ground in this country. See freight trains in Texas in largely unpopulated areas already pushing close to 80 mph. I wonder what additional technological improvements would be enough for the railroads to increase the speed to 90-100 mph?
The technology for high speed freight is already here and has been for some time-more locomotives. But the value of high speed freight…that is still elusive. The AT&SF tried premium speed service but found that that even one fast train a day played havoc with dispatching and schedules all over the place.