End of Amtrak chasing profitability?

If Congres finally sstrip Amtrak's for profit mandate, maybe the can reauthorise Amtrak as a federal government entity

Gilbert B Norman wrote: ↑Thu Dec 05, 2019 8:19 am Tablecloths, fresh flowers, metal flatware, glassware, comp wine, food quality at, say, Seasons 52 level.....

"Amenity kits", comp snacks, beverages (alcohol from the Attendant) in the Sleepers throughout the trip....

...

I doubt if any language within an Authorization Bill means any of the above nonsense could move forth. Travel in nature and scope has simply changed over the past sixty years. H.G. Wells' "Time Machine" would have more takers than the above.

Agreed. Just because they don't have to make a profit (which they never have anyway) doesn't mean they'll go crazy. The nature of the appropriations process still requires a finite budget and overkill amenities would be very bad optics when Amtrak goes to congress each year.

Tadman wrote: ↑Thu Dec 05, 2019 10:42 am

Gilbert B Norman wrote: ↑Thu Dec 05, 2019 8:19 am Tablecloths, fresh flowers, metal flatware, glassware, comp wine, food quality at, say, Seasons 52 level.....

"Amenity kits", comp snacks, beverages (alcohol from the Attendant) in the Sleepers throughout the trip....

...

I doubt if any language within an Authorization Bill means any of the above nonsense could move forth. Travel in nature and scope has simply changed over the past sixty years. H.G. Wells' "Time Machine" would have more takers than the above.

Agreed. Just because they don't have to make a profit (which they never have anyway) doesn't mean they'll go crazy. The nature of the appropriations process still requires a finite budget and overkill amenities would be very bad optics when Amtrak goes to congress each year.

Actually some of these "overkill" amenities might actually draw more passengers, and in turn, REDUCE the deficit that Amtrak runs.

Why wouldn't we all want Amtrak to use its funds as efficiently as possible, focused on profitability, since the less Amtrak has to get funded by Washington, the fewer problems it will have due to Congressional micromanagement? For example, isn't the removal of dining cars due to a Congressional mandate to reduce food and beverage losses? And so if Amtrak didn't depend on funds from Washington, it could operate all of the dining cars it wanted to?

If there were a way to remove government involvement from Amtrak, that would be ideal.

SouthernRailway wrote: ↑Thu Dec 05, 2019 12:57 pm If there were a way to remove government involvement from Amtrak, that would be ideal.

That is why operational profitability is a good way to go. I suspect if Amtrak was only going to Congress for infrastructure projects, Amtrak might get a more receptive audience.

It’s good to reduce expenditures and losses within reason, as long as it doesn’t interfere with Amtrak’s core business model and Federally-mandated mission. Nothing wrong with a diversified funding base either, from states, localities, transit authorities (for contract service) and organizations & private railcar owners.

That said, a Federal passenger rail operational trust fund is way overdue. Is this something Anderson has considered publicly?

Isn't it rather disingenous to say that Amtrak may break even next year when they're still getting a huge subsidy from Congress?

SRich wrote: ↑Thu Dec 05, 2019 8:47 am If Congres finally sstrip Amtrak's for profit mandate, maybe the can reauthorise Amtrak as a federal government entity

Why would that make a difference? Amtrak is presently a corporation owned by the federal government.

Ken W2KB wrote: ↑Thu Dec 05, 2019 6:07 pm

SRich wrote: ↑Thu Dec 05, 2019 8:47 am If Congres finally sstrip Amtrak's for profit mandate, maybe the can reauthorise Amtrak as a federal government entity

Why would that make a difference? Amtrak is presently a corporation owned by the federal government.

I could be wrong here Ken, but I always thought that Amtrak stock was issued to the member railroads on A-Day.

Common stock went to member railroads — I don’t recall which companies own it now, but it’s a mix of railroads and corporate successors to bankrupt railroads — but the Federal government owns all of the preferred stock and can retire the common stock at its whim.

mtuandrew wrote: ↑Thu Dec 05, 2019 11:39 pm Common stock went to member railroads — I don’t recall which companies own it now, but it’s a mix of railroads and corporate successors to bankrupt railroads — but the Federal government owns all of the preferred stock and can retire the common stock at its whim.

Would RDG be one of those successor companies?

The railroads that own or owned Amtrak common stock are or were:

Burlington Northern
Grand Trunk Western (successor: Canadian National)
Milwaukee Road (successor: Canadian Pacific)
Penn Central

I don't know what the current status is, though.

What an odd bunch to get the common stock. GTW didn't have any Amtrak traffic and was owned by the Canadians. MILW was in rough shape.

Was there a buy-in required above the buy-in that all carriers had to do?

n2cbo wrote: ↑Thu Dec 05, 2019 10:54 am Actually some of these "overkill" amenities might actually draw more passengers, and in turn, REDUCE the deficit that Amtrak runs.

To the extent this is true, we've seen such amenities. The best case to see this in operation is the Acela. A 150mph train is an amenity over the standard conventional stock, and was absolutely not necessary, but it attracts passengers who pay a premium, so they buy them. Further, the food served aboard, especially in first class (at-seat), seems to be required to get the high-paying first class passengers.

Amtrak knows some amenities are necessary and provides such. They probably have a staff of accountants that look at the cost-benefit of providing such and then make that decision.

SouthernRailway wrote: ↑Thu Dec 05, 2019 12:57 pm Why wouldn't we all want Amtrak to use its funds as efficiently as possible, focused on profitability, since the less Amtrak has to get funded by Washington, the fewer problems it will have due to Congressional micromanagement?

Unfortunately the conclusion I think we're all aware of is that passenger rail cannot be profitable in a traditional sense when air and autos are so heavily subsidized, directly or indirectly. Ergo a different metric is called for. I'm no fan of governments pouring money into services "just becuase", so there has to be some sort of metric, but traditional profitability goals have seen 40 years of a dysfunctional system chasing its tail. If we keep chasing this metric, we'll keep seeing a marginal long-distance network politically propping up the NEC with some half-decent state corridors thrown in. The same input will result in the same output.

Shifting to some metric such as passenger-miles and discrete rides or even carbon mitigation units could go a long way to selling the concept to both parties. It could illustrate the way passenger trains help job growth and reduce paving expenditures as well as the green/sustainability improvements in a jurisdiction.

mcgrath618 wrote: ↑Fri Dec 06, 2019 12:21 am

mtuandrew wrote: ↑Thu Dec 05, 2019 11:39 pm Common stock went to member railroads — I don’t recall which companies own it now, but it’s a mix of railroads and corporate successors to bankrupt railroads — but the Federal government owns all of the preferred stock and can retire the common stock at its whim.

Would RDG be one of those successor companies?

RDG was one of the few railroads (along with Southern, D&RGW, a few others) that did not participate in formation of Amtrak. It maintained all its passenger service after A-Day; such service was for the most part all commuter service around Philadelphia, subsidized/supported under City/SEPTA auspices.