Amtrak Diner and Food Service Discussion

[Arlington]

The average Eastern sleeper fare is far short of $1000. (in 2016, it was $225, see analysis at bottom)

The average willingness to pay for breakfast is far below $27. Your "breakfast included" hotel probably spends $6 per occupied room for its "free" breakfast. The $27 that George implies Amtrak is spending is 4.5x that. That's way out of line.

And note that these numbers, below (also 2015-ish) are "lunch-dinner" average checks per person:


Note that IHOP (not shown) probably a good proxy for "what people pay to eat breakfast out, sitting down" and their average tab is $10 per person.

The share of US travelers actually willing to patronize the service is what determines the outcome in real life.

From FY2016 (the last for which I've seen sleeper #s separately tabulated)

Code: Select all

## - Amtrak Route 	Riders	Ticket Revs	Avg Fare
16 - Silver Star	35,151	$7,124,882 	$202.69 
18 - Cardinal - - -	9,611	$2,103,868 	$218.90 
19 - Silver Meteor	41,847	$11,678,729 	$279.08 
25 - Empire Builder	79,713	$24,345,250 	$305.41 
26 - Capitol Ltd.	45,172	$8,762,169 	$193.97 
27 - California Zephyr	85,837	$27,584,830 	$321.36 
28 - Southwest Chief	62,979	$19,428,589 	$308.49 
30 - City of N.O.	34,032	$5,724,535 	$168.21 
32 - Texas Eagle	32,344	$7,818,653 	$241.73 
33 - Sunset Ltd.	18,953	$7,818,653 	$412.53 
34 - Coast Starlight	77,280	$17,954,872 	$232.34 
45 - Lake Shore Ltd.	39,562	$9,477,214 	$239.55 
52 - Crescent - - -	28,640	$7,749,124 	$270.57 
63 - Auto Train - - -	107,508	$30,875,587 	$287.19 

Looking at just the Eastern trains (getting "Contemporary" Dining)

Code: Select all

Amtrak Route 	Riders	Ticket Revs	Avg Fare
16 - Silver Star	35,151	$7,124,882 	$202.69 
18 - Cardinal - - -	9,611	$2,103,868 	$218.90 
19 - Silver Meteor	41,847	$11,678,729 	$279.08 
26 - Capitol Ltd.	45,172	$8,762,169 	$193.97 
30 - City of N.O.	34,032	$5,724,535 	$168.21 
45 - Lake Shore Ltd.	39,562	$9,477,214 	$239.55 
52 - Crescent - - -	28,640	$7,749,124 	$270.57 
Eastern LD Trains	234,015	52,620,521	$224.86 

$27 just for breakfast is 12% of the fare. Guess that dinner is $60 and that'd be another 27% of the fare

That 40% of the average fare was going to the diner, and you see why meals were singled out for fixing the operating deficit.

[Tom M]

While this is a discussion board, not necessarily postings of fact, it always concerns me when statistics are tossed around with qualifiers such as "probably", "implies", and "let's assume...". We're mixing opinion and what could be taken as fact.
I'm not sure where the average check data for the restaurants came from. A source would help give it validity. The average fare for the LD trains vs. meal cost, at first glance, makes a good argument. One should quickly acknowledge, however, that the average fare for the Lake Shore includes passengers traveling from NYC or Boston to Chicago as well as those traveling from Boston to Springfield, does it not? I'm a big fan of looking at averages, but in this case, I think using the average fare against a $27 meal cost is unfair. And George, did you mean that $27 was the actual cost to Amtrak for the meal, or what a customer would pay? In the context of average checks at chain restaurants, it looked like that would be the cost to the passenger.

[Tom M]

Likely not supposed "to be out there", but it is:

https://drive.google.com/file/d/1AQjubZ ... tpiqA/view

Reading the "Onboard Service Changes" makes me sad. I've taken many trips and always enjoyed the diner experience. The Overview of changes is loaded with spin. Positive, upbeat words and phrases are sprinkled liberally throughout with a goal of making the reader feel good about the changes. Take those words and phrases out and there's nothing to feel good about. Here are the words I've highlighted from the Overview: Contemporary. Quality. Exclusive access. Enhanced. Higher quality meals. Increased beverage accommodation. Variety of entree selections. Unlimited soft beverage. Enhanced room service. Fresher ingredients. Private, exclusive access. But then, there's this line: "Onboard meal preparation will be replaced with a small variety of quality ready-to-service meals." (Service??) What's "enhanced" about that? How is that going to be "fresher ingredients"? I can get a pretty decent Stouffer's Chicken Fettuccini at the supermarket for $2.39. But is it what I want for "enhanced room service" with a glass of wine? And for breakfast, a hard-boiled egg and breakfast sandwich? That's really going to be something to look forward to in the morning. Spin, nothing but spin.

[Arlington]

Tom: Really? if I'd said "Morgan Stanley" (doing the analysis for investors in restaurants) would you really have found it more acceptable/believable?

Of all the things that Romanian troll farms fake the news on, I find it hard to believe that anyone is sincerely worried that they're faking bar charts on the average customer spend at american restaurants so as to mislead railfans into believing that the cost of LD meals is unsustainable. But here you go: Click the link titled "Here's how much it costs to eat at 22 chain restaurants."

IHOP average ticket of about $10 comes from the bar chart from Credit Suisse here.

Also, do visit NARP and pull the fact sheet on the LSL
https://www.railpassengers.org/site/ass ... 447/45.pdf
and find that, yep, average sleeper fare is still $246 for an average trip of 705 miles (so always a dinner or a breakfast, and frequently both)

What an average sleeper trip of 705 miles tells you (and you can also see from NARP's bar chart) is that the sweet spot in Sleeper Class is 800 to 999 miles (the length of ALB/NYP-CHI), with a small number doing 1000 (BOS-CHI) and the next big slug at 500-599 miles (think: Buffalo-Chicago and Syracuse-Chicago, dinner one way, breakfast the other).

What the average of $225-ish tells you, in this case, is that basically nobody is paying $1000 (the tiny number of BOS-CHI bedroroom customers), and "too many" are doing ALB/SYR/BUF to Chicago, getting at least one meal (dinner or breakfast) and often both, but not paying end-to-end fares.

[gokeefe]

Because $27 is its actual cost, right George?

It is probably somewhere in that ballpark. Maybe a few dollars less but it wouldn't surprise me at all if it were above $20.

As always (and to answer other posts), the problem is not necessarily commissary costs or even labor. It's the cost of serving that meal inside a running certified intercity passenger rail car capable of speeds up to 125 MPH. Your typical diner on Main Street isn't moving at so much as 10 MPH let alone "up to" 125.

The equipment maintenance costs for this type of car are really high. Imagine if airliners had a "diner" cabin and didn't use tray service? It would be a total and complete financial disaster. Airlines save tremendous amounts of money serving from cramped galleys to passengers directly at their seats.

Amtrak does exactly this in FirstClass on the Acela with more than satisfactory results.

[gokeefe]

And George, did you mean that $27 was the actual cost to Amtrak for the meal, or what a customer would pay? In the context of average checks at chain restaurants, it looked like that would be the cost to the passenger.

My implication was that $27 represented the "true" (fully allocated direct expenses) cost. Perhaps a dollar or three on top but not much more than that.

By direct costs I specifically mean car maintenance, labor (inclusive of OPEB), fuel and commissary. No overhead (management outside Amtrak Foodservice Dept), no depreciation and no capital replacement.

[David Benton]

It wouldn't surprise me if it was double that.

[gokeefe]

It would surprise me. At that rate Amtrak would run out of cash before next Tuesday (ok just kidding, but really ... it's not that bad).

[Arlington]

It wouldn't surprise me if it was double that.

$27 seems a reasonable "fully-loaded" cost for Amtrak to serve a breakfast. It wouldn't surprise me if dinner was double that, but it would surprise me if breakfast was not in "the twenties"

[David Benton]

Remember we are talking total cost , not loss ,or margin .
Take onboard crew costs alone . The Crescent and Meteor have 8 sets of crew each . That's an average of less than one return trip per week.Currently 3 crew in the Diner. Now think we are talking the cost to hire a person , not their salary. 100k be unreasonable.? /52 = 2 k per round trip , 1 k each way *3 = 3k . Labor cost no different for beakfast than it is for other meals. so Divided by 3 = 1k per meal. 100 people per meal = $ 10 for obs per meal served. That actually works out better than I expected, so maybe I am a bit on the high side.

[eolesen]

$10 labor per meal plus the cost of the food itself, the service-ware, and the cost of the delivery/storage/disposal. Let's just assume the dining car is a sunk cost...

If you were to assume labor as 30-50% of the cost of any given item, I'd say $27 is a pretty good actual cost estimate for a breakfast.

I won't even spend that much on a nice dinner when I'm on an expense account...

[David Benton]

Correct , I did say the cost of OBS alone. I have no way of estimating the other costs , but I would agree the $ 27 figure is more likely than my original double that.

[bostontrainguy]

Well I guess it could have been worse:

In early 2012, Trenitalia released a web advertisement to promote its change from two classes of train compartments into four classes. Passengers travelling by the fourth (i.e. lowest) class were not permitted to use the on-board cafeteria or enter the carriages reserved for the other three classes. This change alone reportedly caused controversy, but more followed with the release of the accompanying web advertisement. The web advertisement showed only white people seated in the upper three classes and a black family in the fourth, where they are segregated from other passengers on board the train according to the new system.

Italian online media observed this and branded the advertisement as "grotesque", and other complaints of racial discrimination followed in UK newspapers, social media and online. Trenitalia withdrew the web commercial, and quickly substituted it following the allegations of racism. Since 13 January 2012 the cafeteria is accessible also for passengers of lower classes.

- Wikiwand

[Gilbert B Norman]

Well volks, so long as there is full service dining remaining on the LD's originating at CHI, Aramark, the folks who brought "us" the infamous SP Automat, still holds the commissary contract here.

Well, a local NBC News segment aired tonight, shows they also hold the contract at Soldier Field- home of the Bears.

[eolesen]

Aramark runs some high end corporate fining rooms, and they also do things like school and prison cafeterias, so your mileage may vary...