Another luxury (private car on Amtrak) rail service?

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A travel-related email I read today referred to a new luxury rail service starting next year, using cars from the 1930s through the 1960s. When I clicked on the link, it led me to this outfit. Link.

It's a bit vague because their plans are on-hold during Covid, but this seems like another luxury rail service proposing to semi-regularly run private cars at the end of Amtrak trains. See this page in particular.

I was a bit surprised because I hadn't seen any reference here to this enterprise.
 
Wow. You took me back to my American Orient Express (gone thru a few iterations) that I used to take back & forth from DC to Chicago in the ol' daze! LOL, from the baby lamb chops, piano bar, coat & tie required to heat & serve box dinners, shirts & shoes required today.
 
This is interesting, especially since they are promising two-level cars, probably former Santa Fe high-level cars. One car is apparently ready and has been approved for Amtrak service. This is all completely out of the blue. I'm very surprised about the rehab of the high level car. How did this happen without any railfan gossip?
 
Looks interesting, I wonder how they plan on accessing the trains as they stay overnight in a city. I can imagine a station willing to give 24 hour access via tying up a platform, but I can't imagine paying that much for the trip and having to walk though a trainyard to go to bed.
I also wonder how many meals are included, as it seems to be operating in a similar format to a bus tour. So will there be an option to return for a meal or will you be totally on your own in a city and only eat on board if the train is in motion.
 
Interesting - too bad they can't have their own engine instead of relying on Amtrak to pull them around

I'm afraid my pockets are not deep enough for a "Journey"
 
Paging @Seaboard92. He will likely know what's going on here.


I actually know nothing about whats going on here. But I will get to the bottom of it here shortly. I wonder if they need a car to lodge their crew or a budget sleeper.

Looking at their website the sleeper looks like it's the Berlin which is a former American Orient Express Car. I'll have to ask Kevin if he knows anything about that. That being said there should be plenty of AOE cars still around I don't know the dispositions of them all. I know Grand Canyon Railroad owns a lot of them.

I can tell they aren't using a traditional diner either because I've never seen a layout like that. I honestly don't think it will work well because you need a much larger kitchen to deal with five cars worth of passengers. You can cook for thirty in a standard PV kitchen but it's difficult. But five cars in a small kitchen just shoot me now please.

The picture of the display car they are showing looks like one of Ben Butterworth's display car. I'll have to ask Ben if he knows about the image of his car on their website.

The Hi-Level looks interesting. Again the only person I know with these is Ben Butterworth. It is odd to me that they are showing on the diagram having an elevator in the car. That is something that has never been attempted, and it's in a really small space that I don't think it would fit to be honest. So that is rather odd.

It will definitely be interesting to watch them try and bring it to market. I strongly doubt they will however. It is also interesting that a lot of the rolling stock photos they have are of Rapido model trains or cars I know the owners of.
 
Looks interesting, I wonder how they plan on accessing the trains as they stay overnight in a city. I can imagine a station willing to give 24 hour access via tying up a platform, but I can't imagine paying that much for the trip and having to walk though a trainyard to go to bed.
I also wonder how many meals are included, as it seems to be operating in a similar format to a bus tour. So will there be an option to return for a meal or will you be totally on your own in a city and only eat on board if the train is in motion.

That isn't always the case for instance I'll name some cities where you aren't in the yard. Washington, DC (Track 30, or Track 10), Boston, MA, Seattle, WA, Portland, OR, Denver, CO, and Miami, FL are the ones I can think of off the top of my head.

Looking at their first routing Texas and Louisiana I'll give a run down of the layover location.

Fort Worth, TX I believe there is room in the station for the cars to be either on the platform because Amtrak only ever tends to use one track of the two available to them at a time. They could also be put on the midday storage track for the Heartland Flyer as well.

San Antonio, TX: You'll be parked where they leave the cut cars for the Eagle that spend the week there for the one day the Sleeper goes to LAX, and an arriving sleeper doesn't arrive.

Houston, TX: Has a private car track right next to the station. Patrick Henry keeps his two cars there for a large chunk of the year, or did in the past. I think they are in Kansas City now.

Interesting - too bad they can't have their own engine instead of relying on Amtrak to pull them around

I'm afraid my pockets are not deep enough for a "Journey"

Actually relying on Amtrak probably makes this cheaper for them. The amount of insurance required to run on the freight railroads is very expensive, and there are very few insurers who offer that level. I believe Lloyds of London still does however. But I don't know the cost of it, but they would have to be running fairly regularly and have good margins to even think about that. Even the American Orient Express relied on Amtrak locomotives when they ran partially for the insurance, and it is more expensive to maintain locomotives than cars.

What they are doing is following a similar business model of the American Orient Express's original incarnation as the American European Express by operating a cut of five cars on the rear of Amtrak.

I do hope they can find a good PV manager because I strongly doubt that their venture will be successful due to a poor proof of concept route in Texas and Louisana, and I think they are really underestimating the cost and demand.

That being said I know of a perfect route that would work hitting multiple western national parks. And if they would be willing to pay me for my time and opinion I would be happy to grant it.
 
The other way you can tell they are planning on being on the rear of Amtrak is mentioned on their page. When they talk about sometimes crew sleeping space will be available for purchase, and the crew will be put up in the Amtrak sleepers for the segment instead if overnight. Again this looks like someone trying to do a cool product, but has little to no practical experience in the industry.
 
It seems like a logical product to try and create. The format is similar to bus tours or even river cruises. It might even have something over river cruises in that often where they dock is not near the attractions they visit. A train station might be in a better location in some cities.
 
That isn't always the case for instance I'll name some cities where you aren't in the yard. Washington, DC (Track 30, or Track 10), Boston, MA, Seattle, WA, Portland, OR, Denver, CO, and Miami, FL are the ones I can think of off the top of my head.
Miami? The Amtrak station? I wouldn't call that location much better than being in a 'yard'....
 
While I would like to see this enterprise succeed, I am very skeptical over its doing so....
The part about selling 'time shares', kind of raises a red flag to me. Wasn't there a company trying to sell shares in a luxury train operation between Boston and Montreal, a few years ago? That didn't go very far...
Has Amtrak relaxed its rule about switching out private cars at intermediate points? Without that ability, the new operation would be quite limited...
 
While I would like to see this enterprise succeed, I am very skeptical over its doing so....
The part about selling 'time shares', kind of raises a red flag to me. Wasn't there a company trying to sell shares in a luxury train operation between Boston and Montreal, a few years ago? That didn't go very far...
That sounds vaguely familiar. Was this part of the private "Montrealer" proposal maybe 20 years ago? IIRC a Quebec businessman was trying to sell shares in a private train that would operate on CP (ex-D&H) overnight to points in the US. It didn't really replicate the Montrealer since it didn't serve Vermont.
 
If you talk to the folks at American Orient Express and Pullman Rail Journeys, it might become clearer to see if this venture will be successful or not.
 
While I would like to see this enterprise succeed, I am very skeptical over its doing so....
The part about selling 'time shares', kind of raises a red flag to me. Wasn't there a company trying to sell shares in a luxury train operation between Boston and Montreal, a few years ago? That didn't go very far...
Has Amtrak relaxed its rule about switching out private cars at intermediate points? Without that ability, the new operation would be quite limited...

I don't know of the one you are talking about but I know of a man who tried selling timeshares in his private car which is a former VIA Rail Park Car. He was going to use the income from that to pay for the interior renovation and the Amtrak certification of his car. That was over 15 years ago if I recall right and the car still isn't Amtrak certified. I would know I thought about buying it recently and made an offer. But I would never accept the insanely high over value for that car that was replied. I'm happy with what I have, it just would have been nice icing on the cake.

If you talk to the folks at American Orient Express and Pullman Rail Journeys, it might become clearer to see if this venture will be successful or not.

Pullman Rail Journeys and the American Orient Express were really two separate products while similar but no where near the same. PRJ operated on the rear of Amtrak, whereas AOE operated mostly as a stand alone charter train on it's own schedule, and most of the time off route.

PRJ was mostly brought down by things outside of it as far as the overall health of the company that was fielding it. Had the rest of the IPH family been healthy PRJ very well could still be operating today.

AOE on the other matter was vastly different. Their big struggle was the 2008 Great Recession which sunk them. Had they stuck with the two trips that made them the most money they actually stood a decent chance of surviving. Had they stuck with the Great Northwest and Rockies, and National Parks of the West I think they could have weathered the storm a bit better. Instead of running up debt on the transcontinental trip, or running on the east coast in the spring time. Their other problem was they restricted the capacity to such a small number they had to charge higher prices. Had they used regular 10/6s and other more normal railcars with higher capacities they might have faired better. I want to say they had five or six cars on each train that weren't revenue producers. Something like a train works better when you have an economy of scale to work with. Lower prices mean more riders, and with a larger capacity you can equal the money of fewer passengers or exceed it. And it allows your product to be more achievable for the mass market.

For my family it was do we want to go to Europe, or ride some fancy train across the USA. Europe won that round, it cost the same amount and the trip to Europe was three weeks vs one week on a train. That being said I wish I had gotten to ride the AOE more than I did. As I did get a small ride from SAV-CHS once when I was 10.
 
Seaboard, your comment prompted me to look through old photos. Took this in 2006 when AOE was parked in Savannah. No ride, but did get to do a walk through as it was being serviced. It was great and I do wish it had succeeded. I'm sure reasons you cite were its downfall. I think some of these promoters feel the need to have over the top equipment and amenities. I'm happy with good food, service, and comfortable accommodations where everything works. Of course a dome and observation help too!

And Savannah is another good location for a special train to tie up. While its not downtown, the station is nice and in a safe area with good servicing facilties, since the Palmetto turns there. An uber ride will get you to the historic downtown attractions.

IMG_1068_2 (1).jpg
 
Seaboard, your comment prompted me to look through old photos. Took this in 2006 when AOE was parked in Savannah. No ride, but did get to do a walk through as it was being serviced. It was great and I do wish it had succeeded. I'm sure reasons you cite were its downfall. I think some of these promoters feel the need to have over the top equipment and amenities. I'm happy with good food, service, and comfortable accommodations where everything works. Of course a dome and observation help too!

And Savannah is another good location for a special train to tie up. While its not downtown, the station is nice and in a safe area with good servicing facilties, since the Palmetto turns there. An uber ride will get you to the historic downtown attractions.

Savannah is one of the best locations to tie up a special train without hindering operations. So is Jacksonville but it doesn't have as many nice things in downtown like Savannah. In Charleston, SC they tied up on Palmetto Railways on the former US Navy Base down there.

The problem most of these promoters forget is luxury isn't the ultimate selling point. If you have good food, good service, good activities, and comfortable accommodations you have a winning product. Look at VIA Rails's Canadian which as much as I hate to say it is a tourist train. It has good food that isn't gourmet (as that does turn some people off), VIA offers fantastic service that I would say is up there with most PV owners, and lastly you have decent activities. The AOE had a grand piano where they had a classical pianist playing whereas VIA has a local musician with a guitar playing.

What makes the local musician better is they oftentimes play popular music that the audience likes to hear and can sing a long with. It's fun and it is incredibly memorable. Whereas just background piano music while classy is not really memorable. Then VIA has other things like wine tastings, beer tastings, trivia games, etc.... The biggest difference is AOE stopped for the day so passengers could do sightseeing.

The best route in my opinion they had was "The National Parks of the West"
Here is the basics of the routing.

Day 1: Albuquerque, NM where they did a welcome aboard reception.
Day 2: Santa Fe, NM where they had the option of gallery and museum tours. Geared at art and dining it appears.
Day 3: Rail Day between Santa Fe and Grand Canyon apparently in daylight. This would be on the Southwest Chief route.
Day 4: Grand Canyon National Park (South Rim)
Day 5: Las Vegas, NV: Which is listed as having three options a on your own day, the Hoover Dam, or visiting Valley of Fire State Park. I'm sure this was a popular stop with the target demographic.
Day 6: Zion National Park or Bryce Canyon National Park from Cedar City, UT. Pick one or the other based on your interests.
Day 7: Salt Lake City, UT with tours of the city or the Great Salt Lake.
Day 8: Yellowstone National Park
Day 9: Grand Teton National Park
Day 10: Final day at Grand Teton National Park

The Second Best routing was the "Great Northwestern National Parks"
Day 1: Seattle, WA welcome reception
Day 2: Mt. Rainier National Park tour on the Road to Paradise.
Day 3: Rail Day either over Stevens Pass or the Columbia River Gorge depending on freight traffic the train could go either way.
Day 4: Glacier National Park: A guided tour over the Going to Sun Road.
Day 5: Missoula, MT a historic tour of homes, Bitterroot Valley tour
Day 6: Helena, MT a visit to the state capitol and a river boat tour.
Day 7: Yellowstone National Park
Day 8: Grand Teton National Park
Day 9: Fly Home from Jackson Hole, WY

Had the AOE Stuck to these two routings and had a lower price point they would have been far more successful. To further prove my point I'll analyze their operation more in depth in the next post.
 
Post 2: Analyzing the American Orient Express

Note I am basing this information based on a consist listing I found online for one of these routes under the AOE ownership.
-Locomotives
-2 Crew Cars
-Bar Harbor (8 Grand Suites, 1 Single Bedroom)
-Vienna (2 Presidential Suites, 7 Vintage Pullman)
-Santa Fe (No Information Available)
-Charleston (8 Grand Suites, 1 Single Bedroom)
-Seattle (Club Car)
-Chicago (Diner)
-Zurich (Diner)
-Copper Canyon (Full Dome)
-Montreal (9 Vintage Pullman)
-Paris (2 Presidential, 2 Parlor Suites, 4 Single Bedrooms)
-Denver (8 Grand Suites, 1 Single Bedroom)
-Savannah (8 Grand Suites, 1 Single Bedroom)
-New York (Observation)

So of your 15 car train, 2 cars are reserved for crew, and 5 cars are non revenue producing, meaning a total of 7 cars or 46 percent of your train isn't generating you any revenue but still has the same fixed costs to operate. I will say there is a place for things like diners, domes, lounges, and observations because it's important for marketing. My business partner and I were talking last night about how including free coffee on a commuter service would entice people to pay for a private commuter lounge car because people would tabulate the average cost of what they pay in coffee and decide it is a good deal if we included it. I concur with that thought so I do believe that service can be a selling point. Just don't let the illusion of grand service keep you from making money. The prices I am using come from the National Parks of the West Tour for 2009 the last year ever marketed.

So on this above consist you have the following rooms.
-32 Grand Suites: Sleeps 2 ($8,550 Per Person)
-4 Presidential Suites: Sleeps 2 ($8,160 Per Person)
-8 Single Bedrooms: Sleeps 1 ($7,250)
-16 Vintage Pullman: Sleeps 2 ($5,950 Per Person)

So based on these figures here is your income on a sold out train.

-64 Grand Suite Passengers: $547,200
-8 Presidential Suite Passengers: $65,280
-8 Single Bedroom Passengers: $58,000
-32 Vintage Pullman Passengers: $190,400
-112 Total Passengers. Total revenue of $860,880

But of that revenue a sizable chunk is going away to pay Amtrak for the locomotives, crew, fuel, and the milage charge Amtrak accesses for a charter move. Let's base it on what the Amtrak charge used to be for New River Train which was $1.00 a mile (it has since gone way up). You are hauling 15 cars so $15 per mile. The milage was 1,833 Miles. So figure that is about $27,495 just for the cars. I can't tell you what the other Amtrak costs were but lets just say it cost $100,000 (Including Car milage) to run the train. That is 11 percent of your revenue going to Amtrak.

Factor in you are feeding the passengers the following meals. Using methods taught to me by Chris at New River Train for food planning.

-9 Breakfasts: Budget $2,240 Per Meal
-8 Lunches: Budget $2,800 Per Meal
-9 Dinners: Budget $3,360 Per Meal

So that totals out to the following.
Breakfast: $20,160
Lunch: $22,400
Dinner: $30,240
Total: $72,800

So food is 8 Percent of your revenue.

Now lets get into staffing being a luxury train I would think they have one steward per car. So lets go into the jobs shall we.
-8 Stewards at $200 per day or $1,600 per trip (remember they go on a bus from Day 8)
-7 Lounge Attendants (rough guess on what I would use for a luxury product) also at $200 per day or $1,600 per day.
-1 Chef at $400 per day or $3,200 per Trip
-5 Sous Chefs at $300 per day or $2,400 per trip.
-8 Servers for the two diners at $200 per day, or $1,600 Per Trip
-1 Mechanical at $400 per day or $1,600 per trip.

And I'm sure I'm forgetting some other positions for management and elsewhere but this will work for this non academic academic example.
So your staff cost by type of staff is.
-Stewards: $12,800
-Lounge Attendants: $11,200
-Chef: $3,200
-Sous Chef: $12,000
-Severs: $12,800
-Mechanical: $1,600
Total: $53,600

So staffing in this incomplete picture is 6 Percent of your revenue

Then lets take in off train activities.
Lets just say they took a 56 passenger charter bus for easy figurings. Which means at every stop they need exactly two buses to carry everybody.

There are a total of 6 different bus tours listed in the itinerary that was marketed. Which means you need a max of 12 buses for each trip. A rough average for a charter bus is $1,500 per day. Which means we are spending $3,000 for each charter bus tour day. Then we need to factor in admission fees so lets just throw an even $200 in there which should cover a decent amount.

So off train activities cost $19,200 total. Or 2 percent of your revenue.

Now comes the real fun part back office costs.

Back office consisting of management, booking engines, HR, marketing, insurance, and maintenance on the cars. I don't have to tell you how expensive maintaining railcars is but it is very costly I would know first hand. I can't estimate these charges especially for one trip because the advantage to running multiple trips is you can spread this cost across multiple runs. This is a fixed cost attributed yearly.

So to recap what we know so far.
Revenue: $860,880
Amtrak: $100,000 or 11 percent
Food: $72,800 or 8 Percent
Staffing: $53,600 or 6 Percent
Off Train Activities: $19,200 or 2 Percent.

So your total profit not counting back office costs comes to.
$615,200

Now this isn't a true picture because we don't know what the Back Office Costs come to.

Now to critique their business plan now that we know more about the costs/profits.

I would say their largest problem was each car when you count the non revenue producing cars only had 7.2 passengers. That is an abnormally low number for a train. Keep in mind a 10/6 sleeps 22, an all double room car sleeps 24. If I were them I would abolish 1 diner, and 1 club car and replace them with two higher capacity revenue cars. It would drop your staffing costs because instead of having 9 employees you would have 2 for those cars. You are saving money by cutting the staff wages and making more money by having more capacity. The more capacity you have the lower the price can go.

The other problem I see is you have to have fairly full trains to make money considering we use a 40 percent load in the industry to determine our profitability. So on this train that would be 44 passengers. And at the price of the tickets it was difficult for them to fill trains. I could see them running trains that were either marginally profitable, or slightly loosing money as the equipment has to get positioned for the next run.

Of course you have to factor in too that some of their tours were less popular and less likely to sell out a la the Grand Transcontinental that went from Los Angeles, CA to Washington, DC to reposition for springtime in the Antebellum South. And at the prices they were charging for that run it is no wonder it was one of the lower runs in terms of ridership and load factor.

To sum up all of my points into something short and concise would be this.

1. They charged too high for the domestic market, and by not having it accessible to the middle class they priced themselves out of existence.
2. Their margins were not sustainable without a decent load factor which oftentimes was unobtainable for trips that were too costly. Especially trips like the Great Transcontinental.
3. They had too low of a capacity for the overall train. Capacity is key it allows you to offer lower prices, and have higher margins.
4. Too many non revenue producing cars to revenue producers.

I'm sure all of you weren't expecting this length of a novel basically. But once I get started analyzing something I like to make the research as complete as I can. I am a detail oriented freak and I love researching things. Hopefully one day these talents will find a use where they aren't wasted like doing free research analysis of a former tourist train. I really enjoyed writing this though. I look forward to the feedback.

Total time allotted to typing this up: 19:00 ET-23:00 ET so four hours.

And honestly those four hours flew by because I was having fun.

Also can we please bump the character limit on AU up, this is like the 6th time this month I've bumped up against it and had to split posts up. I love details, I thrive on details, so I oftentimes forget about 10,000 characters.
 
AOE's business plan was based on snobbery. So they had these "grand suites" and upper class dining and lounging. This formula has worked in Europe, but apparently there's no market for it in North America. As Seaboard pointed out, his family could spend three weeks in Europe for the same price as a week on the AOE.
Pullman Rail Journeys used old Pullman cars that were just like the 1940's. Only railfans had any interest in this and railfans aren't a big enough market to sustain such an operation.
Rocky Mountaineer has succeeded based on daytime running and overnights in hotels. They are still incredibly expensive, though.
 
AOE's business plan was based on snobbery. So they had these "grand suites" and upper class dining and lounging. This formula has worked in Europe, but apparently there's no market for it in North America. As Seaboard pointed out, his family could spend three weeks in Europe for the same price as a week on the AOE.
Pullman Rail Journeys used old Pullman cars that were just like the 1940's. Only railfans had any interest in this and railfans aren't a big enough market to sustain such an operation.
Rocky Mountaineer has succeeded based on daytime running and overnights in hotels. They are still incredibly expensive, though.
 
I agree about where a service should appeal:
1) Amtrak beds (bunk beds) are a problem for many older people and disliked by those willing to pay for both beds on the floor but "Grand Suites" and the like should be few as compared to ordinary (but bigger) rooms with doubles and queen beds which should predominate. A few bunk rooms could be adjacent to a like number of double/queen rooms with shared door/facilities for families.
2) Alcohol is a big money maker for restaurants, cruise ships, etc. so including alcohol is not a good idea as it raises the average cost for the benefit of a fewer heavier drinkers who would be willing go pay by the drink or buy an alcohol package.
3) Many people who would travel on "luxury trains" have been there and done that when it comes to destinations so, except for out-of-the-way places like the Grand Canyon, it might be best to make tours optional so some who might want to wing it can do so either to save money or to share expenses (like a car rental) with other travelers. I would envision, e.g. in San Antonio, that less traveled people might just want to go to the Riverwalk and Alamo on their own while those that have done that might be interested in tours to outer areas.
4) I like the idea of travel without the room on a non-overnight in a little more luxury than Amtrak with less expensive hotel stays (anyone remember the "Montana Daylight"?). This would work great on Amtrak's imagined shorter distance routes (e.g. Atlanta to Nashville) or for shorter portions of long distance luxury rides where the daytime riders would have use of the diner and lounge cars. Think of attaching luxury daytime cars to the Carolinian for overnight hotel stops in Greensboro, Raleigh, Richmond and D.C. or something comparable on the Adirondack.
5) It would be nice to have Amtrak contract with third parties to offer one or more of the mentioned services where Amtrak would handle the ticketing for a cut of the pie and the third party would provide the cars and service. Getting Amtrak to really buy into the concept would encourage them to become a partner rather than a reluctant provider as it could mean Amtrak agents at stations could handle checked baggage, bus interface for tours, etc and help pay for the existence of these agents during hours when they would have little to do and/or allow agents to have additional hours where they may only presently be part-time. Stations with excess room could now have separate areas for the luxury car passengers ala Amtrak lounges helping to justify the cost of those stations.
 
Thorough analysis, Seaboard. It makes it pretty clear why third party luxury trains have a hard time making ends meet.

5) It would be nice to have Amtrak contract with third parties to offer one or more of the mentioned services where Amtrak would handle the ticketing for a cut of the pie and the third party would provide the cars and service. Getting Amtrak to really buy into the concept would encourage them to become a partner rather than a reluctant provider as it could mean Amtrak agents at stations could handle checked baggage, bus interface for tours, etc and help pay for the existence of these agents during hours when they would have little to do and/or allow agents to have additional hours where they may only presently be part-time. Stations with excess room could now have separate areas for the luxury car passengers ala Amtrak lounges helping to justify the cost of those stations.

I completely agree with this. I would take it a step farther and have the third party handle not only the tour business but the regular sleeper traffic and perhaps dining, other than the cafe cars. This, of course, is what the old Pullman Company did so successfully for so many years.
 
4) I like the idea of travel without the room on a non-overnight in a little more luxury than Amtrak with less expensive hotel stays (anyone remember the "Montana Daylight"?). This would work great on Amtrak's imagined shorter distance routes (e.g. Atlanta to Nashville) or for shorter portions of long distance luxury rides where the daytime riders would have use of the diner and lounge cars. Think of attaching luxury daytime cars to the Carolinian for overnight hotel stops in Greensboro, Raleigh, Richmond and D.C. or something comparable on the Adirondack.
Having an upgraded coach option such as Club/Business Class is a very smart idea, borrowing from similar premium "chair cars" on many of the heritage railroads. How many Amtrak LD trains offer Business Class? I know of the Boston section of LSL (sometimes), the Cardinal and the Coast Starlight, but can't think of any others? Is the Palmetto a true long-distance route?
 
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