Amtrak Ridership Numbers Oct to March 2012

[afigg]

Amtrak issued a Amtrak On Pace To Set New Ridership Record press release touting ridership growth of +3.7% for the first 6 months of Fiscal Year 2012. The ridership was up +1.9% for the first 3 months, October - December, and +2.5% for October-January, so there has been a surge in the past 3 months. Hello, $4 a gallon gas!

The press release has the total numbers for the 6 month periods for the train services, does not have revenue numbers. Once the February Monthly report is officially posted, the March numbers can be extracted to see what the bump was in March alone.

Summary:

NEC +5.2%

Acela -1.3% (the ticket price increase continue to hurt)

NE Regional +8.2% (going to get crowded year round if this keeps up)

State Supported and Other Short distance corridors: +2.7%

LD Trains: +3.7%

Trains with notable increases:

Ethan Allan +9.0%

Lincoln service +8.2%

Heartland Flyer +10.6%

Capitol Corridor +6.7%

San Joaquin +11.5%

Washington-Lynchburg +27.4% (keeping the streak of > 25% growth going)

Washington-Newport News +16.0%

Piedmont +15.1%

Texas Eagle +16.3%

There are some trains with reduced ridership, but they can mostly be explained:

Acela -1.3%, Surfliner -5.7%: aggressive ticket price increases

Vermonter -11.8% : long service interruption last year hurt, also warm winter weather might have hurt ridership for ski trips

Wolverine: -6.8%: ridership had recovered by February, but the NS slow orders in March set it back again

Carolinian -5.8%, Palmetto -8.0%: CSX track work in March resulted in no Palmetto service and no Carolinian service north of Raleigh Monday through Thursday for the entire month.

Pennsylvanian -0.3% : should be doing better

Albany-Niagara Falls-Toronto -4.4% : don't know why this is down

Once the Acela, Surfliner recover from ticket price increases and Vermonter, Wolverine recover from track work outages, they should get on the plus side for growth which could bump Amtrak to > +5% annual growth numbers.

 

[jebr]

The Zephyr is also at -3.5% for ridership.

 

[Anderson]

Well, this came up (credit goes to Amtrak for mentioning it, actually), but the Acela is likely getting hit because of the Regionals getting Wi-Fi as well.

Also, the Pennsylvanian is up slightly for Feb/Mar...it was down .7% through the end of January.

I don't think we're going to get to 5% growth for the year...one thing I've noticed is that during the summer, Amtrak slams into capacity limits all over the place like it's 1979, and this starts seriously restricting ridership growth.

Running a bit of extrapolation, assuming that PPR remains what it has been...would anybody care to bet $5 or a drink that the Lynchburger never actually requires a subsidy from VA? I checked the numbers, and I think they're on course to come in about $250,000 shy of the revenue required to vault it even with the recalculation of costs. The WAS-NPN segment is in the same general boat, too.

 

[The Journalist]

I can't get the thing to download-but I can't get it from Amtrak's site either so it's probably on my end.

It'll be intriguing to see the revenue numbers on the Acela and Surfliner-if they're carrying fewer passengers but getting more revenue (and pushing price-sensitive riders to the Regionals or...uh, Metrolink/Coaster I guess? Not really a good comparison) then the pricing strategy is probably a success, at least on the Acela.

 

[dlagrua]

With $5 gas coming soon; Amtrak should continue to grow but I predict that the aggressive price increases that we've seen of late will have an negative effect on ridership. Amtrak will soon realize that the economy is in a very deep recession and will need to adjust prices accordingly. You can only charge so much and then ridership starts declining. We shall see.

 

[afigg]

Well, this came up (credit goes to Amtrak for mentioning it, actually), but the Acela is likely getting hit because of the Regionals getting Wi-Fi as well.

Also, the Pennsylvanian is up slightly for Feb/Mar...it was down .7% through the end of January.

I don't think we're going to get to 5% growth for the year...one thing I've noticed is that during the summer, Amtrak slams into capacity limits all over the place like it's 1979, and this starts seriously restricting ridership growth.

You are probably right about not getting to 5% growth this year. February 2012 ridership was up +6.8%. If my math is correct, ridership was up +5.8% in March. With service interruptions coming for the Lincoln corridor, likely some other corridors for track upgrade work, and capacity limits for some peak trains and periods, that will restrict growth. On the other hand, the NEC and east coast routes took a significant hit due to Hurricane Irene and TS Lee last August & September, and if the east coast does not get clobbered by hurricanes or tropical storms this year, that will keep the ridership numbers up. There were also the prolonged disruptions to the Empire Builder and California Zephyr.

If there are no major breakdowns, Amtrak should handily exceed 31 million passengers this year. Reaching 31.5 million would require close to +4.4% growth.

Running a bit of extrapolation, assuming that PPR remains what it has been...would anybody care to bet $5 or a drink that the Lynchburger never actually requires a subsidy from VA? I checked the numbers, and I think they're on course to come in about $250,000 shy of the revenue required to vault it even with the recalculation of costs. The WAS-NPN segment is in the same general boat, too.

Even if the Lynchburger does not technically require a subsidy, Amtrak should get some funding from VA to support the train. What happens if ridership falls or expenses go up? Better to maintain the precedent of a minimum level of state funding, so the funds are there if Amtrak needs to draw on them. Amtrak may want to draw on a small amount of state funding regardless as they can use all the funding and revenue they can get.

 

[Guest]

With $5 gas coming soon; Amtrak should continue to grow but I predict that the aggressive price increases that we've seen of late will have an negative effect on ridership. Amtrak will soon realize that the economy is in a very deep recession and will need to adjust prices accordingly. You can only charge so much and then ridership starts declining. We shall see.

The higher prices are because ridership/demand is up and this is nothing new. Amtrak has long charged more when they can for high demand departures and there seems to be more opportunities for them to do this as of late.

 

[afigg]

I can't get the thing to download-but I can't get it from Amtrak's site either so it's probably on my end.

It'll be intriguing to see the revenue numbers on the Acela and Surfliner-if they're carrying fewer passengers but getting more revenue (and pushing price-sensitive riders to the Regionals or...uh, Metrolink/Coaster I guess? Not really a good comparison) then the pricing strategy is probably a success, at least on the Acela.

The Amtrak press releases can be found here if that helps.

The Surfliner revenues are indeed up despite the decline in ridership. For October to January, Surfliner ridership was down -6.9% while ticket revenue was +7.1%. Amtrak is indeed pushing the prices to generate more revenue at the loss of ridership for the Surfliner route. If people get used to the new ticket prices and gas prices increase, ridership should bounce back. Service and trip time improvements would be another way to get ridership back on the positive growth trend.

The Acela ridership for October to January was down -2.6%, but revenue was up a small amount at +2.1%. Think this shows that Amtrak has just about maxed out what the market will bear for the Acela at the current service and trip time levels.

 

[Anderson]

Well, this came up (credit goes to Amtrak for mentioning it, actually), but the Acela is likely getting hit because of the Regionals getting Wi-Fi as well.

Also, the Pennsylvanian is up slightly for Feb/Mar...it was down .7% through the end of January.

I don't think we're going to get to 5% growth for the year...one thing I've noticed is that during the summer, Amtrak slams into capacity limits all over the place like it's 1979, and this starts seriously restricting ridership growth.

You are probably right about not getting to 5% growth this year. February 2012 ridership was up +6.8%. If my math is correct, ridership was up +5.8% in March. With service interruptions coming for the Lincoln corridor, likely some other corridors for track upgrade work, and capacity limits for some peak trains and periods, that will restrict growth. On the other hand, the NEC and east coast routes took a significant hit due to Hurricane Irene and TS Lee last August & September, and if the east coast does not get clobbered by hurricanes or tropical storms this year, that will keep the ridership numbers up. There were also the prolonged disruptions to the Empire Builder and California Zephyr.

If there are no major breakdowns, Amtrak should handily exceed 31 million passengers this year. Reaching 31.5 million would require close to +4.4% growth.

Running a bit of extrapolation, assuming that PPR remains what it has been...would anybody care to bet $5 or a drink that the Lynchburger never actually requires a subsidy from VA? I checked the numbers, and I think they're on course to come in about $250,000 shy of the revenue required to vault it even with the recalculation of costs. The WAS-NPN segment is in the same general boat, too.

Even if the Lynchburger does not technically require a subsidy, Amtrak should get some funding from VA to support the train. What happens if ridership falls or expenses go up? Better to maintain the precedent of a minimum level of state funding, so the funds are there if Amtrak needs to draw on them. Amtrak may want to draw on a small amount of state funding regardless as they can use all the funding and revenue they can get.

On the disruptions: To be honest, I'm assuming that something is going to disrupt service in a meaningful way somewhere over the summer and that we haven't punched that in. I agree that adding a million riders is probable...I'm just of the opinion that expecting an addition of more than 1.5 million would be chancy.

As to the VA trains, I'll be as realistic as I can there: Barring gas prices dropping substantially, something that is possible but not likely in the next 2-5 years, I think those trains are going to build up a decent buffer against operating losses. Now, I'll agree that the surplus should probably go into an account either to kickstart other services (even if a service turns a profit at the end of the day, those first-year losses can be hard for some folks to get past) or to cover potential eventual losses, but the biggest problem I can see there is that it is not unreasonable for a state to balk at having to fork over cash to back up a train that is turning a profit.

In essence: If VA has to put money into those services, they should get the benefit of that money somehow. Maybe it would go to acquiring some dedicated equipment (which would likely reduce the capital charges at least somewhat), maybe to a reserve fund, maybe to kickstart an additional frequency/help out with the TDX/add more frequencies to Hampton Roads, or maybe to a joint fund to run things with NC (a second Carolinian? A CLT-NYP via LYH train? Something else?)...but at some point, if VA has to put money into a pot, VA should get the benefits from that pot rather than it going to generically cross-subsidizing things. I hate to put it like this, but Amtrak is already making out like a bandit on this deal...and that's not something you can say about Amtrak very often!

 

[Swadian Hardcore]

The unexpectedely popular Virginia and North Carolina trains are continueing to do well.

A few interesting things I spotted:

Texas Eagle increased 16.3%! We're not even in the summer nigh season yet! Somebody previously predicted a 20% increase this year. Now it seems to be on track for over 30%! The TE could use service to Houston and/or through Armarillo to ELP.

California Zephyr fell 3.5%. Any idea why?

Heartland Flyer and San Joaquin has unexpected increses. The HF especially. Maybe they should have extended it to KCY, anyway. SJ could use service to LAX if they don't keep getting blocked out by freights. :mellow:

 

[Ryan]

With $5 gas coming soon; Amtrak should continue to grow but I predict that the aggressive price increases that we've seen of late will have an negative effect on ridership. Amtrak will soon realize that the economy is in a very deep recession and will need to adjust prices accordingly. You can only charge so much and then ridership starts declining. We shall see.

You've been Chicken Little, saying the sky was going to fall for months.

Yet Amtrak keeps on increasing ridership.

Keep at it, someday you may be right...

 

[BobWeaver]

With $5 gas coming soon; Amtrak should continue to grow but I predict that the aggressive price increases that we've seen of late will have an negative effect on ridership. Amtrak will soon realize that the economy is in a very deep recession and will need to adjust prices accordingly. You can only charge so much and then ridership starts declining. We shall see.

The recession ended almost 2 years ago. Snap out of it already.

Apparently Amtrak is doing something right with their ridership numbers seeing such an increase. They certainly haven't reached the point of decreasing returns. That being said, ridership doesn't really mean anything lot to the state of an operation like revenue does. Acela ridership was down 2%, yet revenue was up 2%. They're making more money per passenger, despite there being slightly fewer of them over the time period mentioned. It's called revenue management for a reason, not ridership management.

 

[Ryan]

Speaking of 2 years...

It is a perfectly valid view point.

No, it isn't.

Extortion: a criminal offense which occurs when a person unlawfully obtains either money, property or services from a person, entity, or institution, through coercion.

Robbery: taking the property of another, with the intent to permanently deprive the person of that property, by means of force or fear.

There is nothing about Amtrak's fare structure that remotely meets the two definitions above, as you seem to indicate that you're aware of later in your post:

In the end, one can elect to pay the price, or not.

Now if you want to have a reasonable debate about Amtrak's pricing decisions, that's fine. Lower price points for all rooms (and Amtrak losing more money, and not being able to book a room less than 6 months out because demand being significantly higher than supply) could be considered a reasonable viewpoint. Ridiculous hyperbole equating them to actual crimes are in no way reasonable.

Both terms are commonly used to describe overpricing of good and services. The #2 Merriam-Webster definition of "extortion" is "gross overcharge." The #2 Merriam-Webster definition of "highway robbery" is "excessive profit or advantage derived from a business transaction." Both seem to fit nicely if one is of the opinion that Amtrak top bucket prices for rooms are way too high.

Notwithstanding your feeling badly for Amtrak being called names, reasonable pricing does not necessarily to equate to lower revenue. The trick is to set the low bucket high enough to build revenue, and the upper bucket low enough to not leave rooms unsold. Whether that means today's upper buckets are too high is a matter of opinion. But, if someone feels they are too high, thinking it represents "extortion" and "highway robbery" is supported by Merriam-Webster.

My comment said LEGALLY extort and I was being facetious. As for highway robbery, we need to put things in to perspective. If the train is way more than air travel, OK lets even say far more than first class air travel, then whats the point of taking an $880 bedroom on a train? We are already paying more for a slower and less efficient form of transportation so that we don't have to suffer the indignities of air travel. However, I believe that there is a crossover point where noncompetitiveness falls into the picture. Our upper limit for a bedroom is around $300. When it becomes much higher then we will chose to drive as we do not consider this to be a good value.

We must also consider the task of attracting new travelers. How is Amtrak expected to attract new customers when some rooms sell for over double the price for a night at the Ritz Carlton?? OK sorry I forgot to add the $40 dinner value.

Supply and demand theory doesn't always hold. Just look at the price of oil. Demand has decreased and the price is still going up. Amtraks ridership last year went down a bit but prices rose. So much for that theory but as pointed out in another post the LSL only has 6 std. bedrooms on the entire train so this may be an unusual and isolated case. I've been on trains where rooms (but mostly roomettes) were readily available and they remained empty the entire trip. I'm talking about less than 50% occupancy. Thats not revenue improvement.

Amtrak needs to think of a better way to price their rooms so that they can fill them all up on every train.

That was over 2 years ago. Looks like Amtrak knows better what they're doing than you give them credit for.

 

[BobWeaver]

He's better left ignored.

 

[Anderson]

With $5 gas coming soon; Amtrak should continue to grow but I predict that the aggressive price increases that we've seen of late will have an negative effect on ridership. Amtrak will soon realize that the economy is in a very deep recession and will need to adjust prices accordingly. You can only charge so much and then ridership starts declining. We shall see.

The recession ended almost 2 years ago. Snap out of it already.

Apparently Amtrak is doing something right with their ridership numbers seeing such an increase. They certainly haven't reached the point of decreasing returns. That being said, ridership doesn't really mean anything lot to the state of an operation like revenue does. Acela ridership was down 2%, yet revenue was up 2%. They're making more money per passenger, despite there being slightly fewer of them over the time period mentioned. It's called revenue management for a reason, not ridership management.

Here's the thing:

1) Political pressure ultimately demands net ridership growth as well as net revenue growth. As long as Amtrak can keep posting ridership records and a shrinking deficit, it probably has a bit of wiggle room politically. So Amtrak has to pull both revenue management and ridership management. Thus far they've been doing both.

2) The Pacific Surfliner illustrates the risk. Now, granted that was a big fare hike all at once, but it still did enough to ridership to give a lot of us a knot in our stomachs. We've also seen this in a few off-and-on LD situations.

3) Finally, there's the issue of needing to match cost growth with revenue growth. In plain English, if you have 50% CR and costs increase by 5%, you need to see revenue jump by 10% to avoid a deficit increase. Which often leads to the fun situation of "Prices are up, ridership is up...so why is the subsidy up as well?"

 

[dlagrua]

With $5 gas coming soon; Amtrak should continue to grow but I predict that the aggressive price increases that we've seen of late will have an negative effect on ridership. Amtrak will soon realize that the economy is in a very deep recession and will need to adjust prices accordingly. You can only charge so much and then ridership starts declining. We shall see.

You've been Chicken Little, saying the sky was going to fall for months.

Yet Amtrak keeps on increasing ridership.

Keep at it, someday you may be right...

The formula of simple economics always has an influence but certainly Bob's analysis on revenue management certainly has merit.

 

[afigg]

Texas Eagle increased 16.3%! We're not even in the summer nigh season yet! Somebody previously predicted a 20% increase this year. Now it seems to be on track for over 30%! The TE could use service to Houston and/or through Armarillo to ELP.

The +16.3% increase is compared to the 6 months in the same period in the previous FY. The summer months may see increased traffic, but it is likely to be in same proportional increase range. Capacity could become an issue on the TE if Amtrak can not find coach and sleeper cars to add to handle the demand.

California Zephyr fell 3.5%. Any idea why?

The CZ had a long service interruption last summer due to the flooding. The On-Time Performance is still poor, apparently because of on-going track & bridge repair and increase in freight traffic. The through passenger business may be doing ok, but the CZ could have lost some shorter range city pair business.

 

[Ryan]

The formula of simple economics always has an influence

Never said that it didn't. By assuming that everyone thinks as you do pricewise, you just think that we're somewhere on the curve that isn't supportable by the data at hand.

 

[jebr]

California Zephyr fell 3.5%. Any idea why?

The CZ had a long service interruption last summer due to the flooding. The On-Time Performance is still poor, apparently because of on-going track & bridge repair and increase in freight traffic. The through passenger business may be doing ok, but the CZ could have lost some shorter range city pair business.

That explains why many of the coach seats are still at low bucket this summer, at least from OMA - SLC (I haven't been checking other city pairs.)

As an aside, is the passenger count based on the number of passengers riding, or do they take into account distance at all? For example, on the EB, is a SCD - MSP passenger counted the same as a CHI - SEA passenger?

 

[Anderson]

California Zephyr fell 3.5%. Any idea why?

The CZ had a long service interruption last summer due to the flooding. The On-Time Performance is still poor, apparently because of on-going track & bridge repair and increase in freight traffic. The through passenger business may be doing ok, but the CZ could have lost some shorter range city pair business.

That explains why many of the coach seats are still at low bucket this summer, at least from OMA - SLC (I haven't been checking other city pairs.)

As an aside, is the passenger count based on the number of passengers riding, or do they take into account distance at all? For example, on the EB, is a SCD - MSP passenger counted the same as a CHI - SEA passenger?

Each trip is a trip, as a rule. The one place that things do get a bit odd is around the NEC (I think there's some room for double-counting on, for example, a LYH-BOS trip).

 

[PRR 60]

California Zephyr fell 3.5%. Any idea why?

The CZ had a long service interruption last summer due to the flooding. The On-Time Performance is still poor, apparently because of on-going track & bridge repair and increase in freight traffic. The through passenger business may be doing ok, but the CZ could have lost some shorter range city pair business.

That explains why many of the coach seats are still at low bucket this summer, at least from OMA - SLC (I haven't been checking other city pairs.)

As an aside, is the passenger count based on the number of passengers riding, or do they take into account distance at all? For example, on the EB, is a SCD - MSP passenger counted the same as a CHI - SEA passenger?

The passenger count is the number of boardings, regardless of trip length. Revenue Passenger Miles, the number of passengers multiplied by the distance traveled, is the metric that takes into account the distance traveled.

 

[PRR 60]

California Zephyr fell 3.5%. Any idea why?

The CZ had a long service interruption last summer due to the flooding. The On-Time Performance is still poor, apparently because of on-going track & bridge repair and increase in freight traffic. The through passenger business may be doing ok, but the CZ could have lost some shorter range city pair business.

That explains why many of the coach seats are still at low bucket this summer, at least from OMA - SLC (I haven't been checking other city pairs.)

As an aside, is the passenger count based on the number of passengers riding, or do they take into account distance at all? For example, on the EB, is a SCD - MSP passenger counted the same as a CHI - SEA passenger?

Each trip is a trip, as a rule. The one place that things do get a bit odd is around the NEC (I think there's some room for double-counting on, for example, a LYH-BOS trip).

I don't believe there is double counting on the Lynchburg service. My understanding is that for the Lynchburg trains, any passengers with an origin or destination in Virginia are counted as Virginia passengers, and a flat 85% of the ticket revenue from those passengers is credited to Virginia. The other passengers and revenue are counted toward the NEC.

 

[Devil's Advocate]

I've seen completely full aircraft numerous times, but I can't say I've ever seen a completely full train. Does anybody know what the percentage is for no-shows on LD trains? Maybe as reservations being to saturate all availability Amtrak could decide to oversell a handful of seats in order to build up their revenue a little further while they wait to see how pro/anti-rail our next congress will be.

 

[Guest]

California Zephyr fell 3.5%. Any idea why?

The CZ had a long service interruption last summer due to the flooding. The On-Time Performance is still poor, apparently because of on-going track & bridge repair and increase in freight traffic. The through passenger business may be doing ok, but the CZ could have lost some shorter range city pair business.

That explains why many of the coach seats are still at low bucket this summer, at least from OMA - SLC (I haven't been checking other city pairs.)

As an aside, is the passenger count based on the number of passengers riding, or do they take into account distance at all? For example, on the EB, is a SCD - MSP passenger counted the same as a CHI - SEA passenger?

The passenger count is the number of boardings, regardless of trip length. Revenue Passenger Miles, the number of passengers multiplied by the distance traveled, is the metric that takes into account the distance traveled.

Yes, every boarding, including connections. One passenger traveling from IND to MKE is counted twice, one boarding on each train.

 

[afigg]

Here's the thing:

1) Political pressure ultimately demands net ridership growth as well as net revenue growth. As long as Amtrak can keep posting ridership records and a shrinking deficit, it probably has a bit of wiggle room politically. So Amtrak has to pull both revenue management and ridership management. Thus far they've been doing both.

2) The Pacific Surfliner illustrates the risk. Now, granted that was a big fare hike all at once, but it still did enough to ridership to give a lot of us a knot in our stomachs. We've also seen this in a few off-and-on LD situations.

Ridership increases get the headlines. Revenue does not, but, yes, Amtrak needs to work to reduce their operating losses as much as possible. The February Monthly Report is now up on the Amtrak website and it shows that revenue is still less than the budget while expenses are running ahead of the budget. So while ticket revenues are up, unless the next 6 months are really good for ticket revenue - and they could be if gas stays near or above $4 a gallon - the budget goal of a reduced $345 million cash loss may not be met. Still, as long as the cash loss is less than $466 million, the FY12 operating subsidy provided by Congress, Amtrak will be ok and able to apply the difference to other stuff.

The capital spending tables, by the way, show a lower mechanical spending than expected due, in part, to the timing of "Acela coach payments". Suggests that the down payment on the Acela coach car order will happen later than expected. The February monthly is still missing the financial data.