Another Ridership Record for Amtrak

[jis]

Honestly if Amtrak managed the market better I think they could make a profit on more individual routes, quite a few are very close to breaking even. When trains are selling out months in advance any business person will tell you to raise prices to maximize revenue.

Amtrak really needs to work on an ARROW replacement, and the new system needs to be able to flex the prices to ensure maximum revenue is achieved while keeping the trains as full as possible. Ideally a train should not sell out until a few hours before departure. Amtrak could jack up prices when seats/rooms sell very quickly to control the rate of sale and lower prices when ticket sales get sluggish, this is essentially what the airlines do.

Amtrak's revenue management team already does all of what you suggest. Perhaps a newer, updated system might make things a bit easier for them; but they currently make adjustments to the number of rooms/seats in any given bucket for any given train all the time as demand and sales change.

One should also remember that by Congressional decree, Amtrak does not have as much freedom to flex prices as all its competition does, because apparently their competition is worried that Amtrak doing so would take their business away from them, and have money to spare to make the point via their lobbyists.

 

[jis]

Geez, imagine Boardman telling Congress "Our ridership is exceeding our capacity and our cost recovery is about 80%. If you order more cars for us, we'll turn profitable!", and the congress critters would be like "HOLAH S*** ITS THE SECOND COMING!!!". :giggle:

"Amtrak turns profitable, cats and dogs sleep with each other!" :lol:

Above the rail cost recovery on NEC overall is now considerably above 100%. Even Regionals taken alone are slightly above 100% effective the Jan 2011 performance report. I am told that Acelas are at 169% in March, by none other than Drew Galloway. This is good news since the deal (such as they are) with Congress was that if Congress funds the capital to support NEC, operations will become profitable, and lo and behold! Here we are! And it is astounding that the likes of John Mica (Chair of Committee on Transportation and Infrastructure) are on board on funding capital improvements on the NEC!

There are plans to add 2 cars per consist for Acelas using financing based on NEC operational profits. Basically it would take around two years to pay off the cost and interest on financing for those cars using current intake. The new electric engines take a 15 or so years (way shorter than their lifetime) financing in the open market at the current low interest rates. So things are not as bleak as some like to make it out to be.

So incredibly Amtrak is adding corridor equipment that is self financed, based on current income and not based on hocking off Penn Station one more time as was done under the genius Warrington may his soul RIP. And amazingly their plans also include reducing fares to match the added capacity to optimum levels to keep load factors above where they are now. The trick at the end of the day is to reduce CASM (Cost per Available Seat Mile) by adding capacity to existing trains, and opportunistically adding more trains, while raising RASM (Revenue per Available Seat Mile) by keeping load factors above where they are with somewhat lower equivalent average fares, thus ensuring that growth in load factor at least neutralizes the reduction in revenue per seat sold and potentially overwhelms it.

I mentioned quite a while back that Emmett Fremeaux VP Marketing and Product Line had his heart in the right place and is a bright guy, and understood price elasticity. Further evidence that he is delivering, after internal fossilized impediments like Crosbie have been set aside by Boardman.

And oh yes, as more California Cars and Midwest equipment comes on line many of the Amfleets and Horizons released are heading back to the NEC as hand me downs. There are plans to add upto another two cars to Regional consists as soon as such cars become available. This was mentioned by Drew Galloway in Atlantic City.

 

[Trainviews]

First of all: Non high speed trains are not profitable but very few places in the developed world (a few single routes are, but most nations choose to keep up whole networks, and pay for that). The slower speed both lowers the value of the product and increases the costs (more time consumed per trip for equipment and staff).

Secondly this is aggrevated by Amtrak's one train a day concept for all the reasons mentioned in the previous comments. But I can't helt to think, that seen from Europe, where I reside (Copenhagen), Amtrak is pretty much stuck in a "glory days of trains" nostalgia, when trains were the principal mode of crosscontinental transport. In Europe I can think of almost no trains running more than 12-18 hour runs (except Russia) and most are far shorter. The competitive market for trains is much more the intermediate distances that are too annoying to drive and are timewise somewhat competitive with flying. The long distance routes are largely left with passengers, who are taking the train get the train experience, and that weakens the case for a needed transportation alternative. The problem for the long distance trains are aggrevated by the schedules as some stations will be served at odd hours, and 3 AM stops will not tap the full passenger potential. There might be an argument for keeping up the services because a lot of smaller communities will lack an alternative, but that will always have to be very subsidised.

As for the shorter routes some are actually at profitability or close, but it all depends on a lot of local factors whether that is possible. Investment in higher speeds will bring more of them into black - but bring a large bill for capital investments.

And finally on my trip to the US last year I did notice a few factors taking the Cascades that looked like making Amtrak an expensive operation.

Boarding at the wonderful Portland Station, which IIRC has nine trains a day, there was four people in the ticket counter, two in the baggage check-in and another three at the boarding gates. The latter I have never seen that anywhere else. Train passengers from Scandiavia to Morocco to India just walk onto the platform and board the train. Additionally most European railways have dropped the checked baggage, and just have the conductor help old ladys with heavy suitcases board the train. Just to put the staffing into perspetive, arriving home at the station at Copenhagen Airport, which has 14+ trains an hour, short and long distance covering all of Denmark and Sweden up to Stockholm with two different ticketing systems plus a metro stop, the ticket office had the same four people on duty as in Portland, no baggage people and no gate staff...

 

[Shanghai]

Will these Viewliner cars also have the "double windows" that the current Viewliner sleepers have?

Since the new cars are based on the Viewliner modular design, the double windows are expected to be on the new cars - except for the baggage cars which don't need windows - but there have been no drawings or much information released about the new Viewliners. The first units are to be delivered in the fall of 2012 and probably won't enter service until 2013.

The dining cars and the new sleepers will have the same double row of windows that the current Viewliner I sleepers have. The baggage/dorms will have the double row of windows only on the dorm end; the bag end will not have any windows other than those in the outside loading doors. I presume based upon that, the the full bags will not have the double row of windows also.

And as has been noted in other threads, the new sleepers will not have the in-room toilets for the roomettes. This will see the attendant's room which is currently room #14 move to room #12 and room #14 across from the shower will become 2 public bathrooms.

Will the new bathrooms have the same Amtrak toilet tissue or will the new bathroom systems be capable of softer tissue??

 

[jis]

Will the new bathrooms have the same Amtrak toilet tissue or will the new bathroom systems be capable of softer tissue??

They will be equipped with special fine quality sand paper dispensers :lol: