Silvers continue to be sold out!

[Eric S]

If Amtrak's consistently getting 100% LF's, then they can and should raise fares.

On sold out trains many of the seats and sleepers are already being sold at high bucket. Raise the price even higher for a trip in the same tired worn out sleepers and you risk losing passenger traffic. If the prices go up any higher we will take to the road. I believe that lots of passengers also feel this way. When Amtrak made the 25% discount on the NE corridor permanent, ridership soared to new record highs. It became a better buy then flying. The consumer realized it and flocked to the rails.

Also consider than on LD trains, Amtrak sleeper prices are 3 to 5x what a plane ticket costs and 5-15x slower. Its still twice as high as a first class airfare seat.

What makes you believe that Amtrak has such a great service that they can get unlimited prices? Prices need to be balanced so that tickets can be sold year round. Only a few trains in the non-vacation months consistently sell out so the forumula of supply and demand already applies.

Did you know that the high bucket ONE WAY fare on the LSL from NYC to CHI is $165 and add on for a sleeper is $463 roomette and $863 bedroom. Do the math and you've got a trip that costs $630- $1028 & again ONE WAY FARE. Round trip costs you $1260-$2056. Thats just not expensive, that's highway robbery!

I don't think anyone has said Amtrak can get away with "unlimited" price increases. But, if trains are sold out, that suggests Amtrak might be able to further increase prices. (Maybe not, though, maybe they are priced at precisely the point that maximizes revenue.) And, in regards to the NEC price cuts, that was in response to declining ticket sales, not sold out trains. If those trains were instead sold out, like some LD trains have been as has been noted, you can be almost certain that Amtrak would have been raising fares, not lowering them.

 

[Ryan]

When Amtrak made the 25% discount on the NE corridor permanent, ridership soared to new record highs. It became a better buy then flying. The consumer realized it and flocked to the rails.

Exactly, that's supply and demand setting the prices. On the LD trains, since they're running near full, prices should go the other direction. Pretty simple, really.

 

[dlagrua]

I don't like those prices either, but if it sells out, it's not highway robbery, it's money in the bank, for Amtrak. Good for them.

It is exactly this type of cold, uncaring, "profit at all costs" attitude that is slowly killing this country. Its the same mentality that caused corporate America to close their American manufacturing facilities and move them to China in the name of higher profits. Who cares about the millions of America people that you put out of work an onto the street. As long as we can raise profits everything is OK-right?

But now the chickens are coming home to roost for without jobs people can't buy anything and the employment problem cannot be solved. Same with Amtrak and our passenger railroad industry. They took lower bids from foreign train manufacturers so Budd and Pullman closed. Who cares-right?

You will see that this "good for them" attitude that you so admire will be short lived. As a total economic collapse looms do you believe that your job is safe?

Point is that there needs to be some fairness in doing business for without it we cannot survive. Business is not solely about profit but making a profit while working to build a strong America.

 

[Bob Dylan]

I don't like those prices either, but if it sells out, it's not highway robbery, it's money in the bank, for Amtrak. Good for them.

It is exactly this type of cold, uncaring, "profit at all costs" attitude that is slowly killing this country. Its the same mentality that caused corporate America to close their American manufacturing facilities and move them to China in the name of higher profits. Who cares about the millions of America people that you put out of work an onto the street. As long as we can raise profits everything is OK-right?

But now the chickens are coming home to roost for without jobs people can't buy anything and the employment problem cannot be solved. Same with Amtrak and our passenger railroad industry. They took lower bids from foreign train manufacturers so Budd and Pullman closed. Who cares-right?

You will see that this "good for them" attitude that you so admire will be short lived. As a total economic collapse looms do you believe that your job is safe?

Point is that there needs to be some fairness in doing business for without it we cannot survive. Business is not solely about profit but making a profit while working to build a strong America.

Normally I disagree with your posts but this is spot on,economics seems to be a field you are well versed in as opposed to personal relations with the great unwashed!

 

[Eric S]

But now the chickens are coming home to roost for without jobs people can't buy anything and the employment problem cannot be solved. Same with Amtrak and our passenger railroad industry. They took lower bids from foreign train manufacturers so Budd and Pullman closed. Who cares-right?

You will see that this "good for them" attitude that you so admire will be short lived. As a total economic collapse looms do you believe that your job is safe?

Point is that there needs to be some fairness in doing business for without it we cannot survive. Business is not solely about profit but making a profit while working to build a strong America.

Except that Amtrak is not increasing profits, but rather trying to reduce losses.

And, correct me if I'm wrong, but Amtrak did not order equipment from foreign-headquartered firms until after Budd and Pullman-Standard closed. Once Budd (Amfleet equipment) and P-S (Superliner equipment) disappeared, they really had no choice but to order from foreign-based firms for all subsequent orders. Perhaps if Amtrak had received more funding, and more stable funding, over the years, they could have been ordering equipment on a more consistent basis, thereby providing enough business for Budd or P-S or some other US-based builder to remain in business.

 

[Ryan]

I don't like those prices either, but if it sells out, it's not highway robbery, it's money in the bank, for Amtrak. Good for them.

It is exactly this type of cold, uncaring, "profit at all costs" attitude that is slowly killing this country. Its the same mentality that caused corporate America to close their American manufacturing facilities and move them to China in the name of higher profits. Who cares about the millions of America people that you put out of work an onto the street. As long as we can raise profits everything is OK-right?

But now the chickens are coming home to roost for without jobs people can't buy anything and the employment problem cannot be solved. Same with Amtrak and our passenger railroad industry. They took lower bids from foreign train manufacturers so Budd and Pullman closed. Who cares-right?

You will see that this "good for them" attitude that you so admire will be short lived. As a total economic collapse looms do you believe that your job is safe?

Point is that there needs to be some fairness in doing business for without it we cannot survive. Business is not solely about profit but making a profit while working to build a strong America.

Amtrak's in business to do business, not make you feel good. As far as the rest of it, welcome to the global economy. Overall, we're much better for it.

 

[PaulM]

Could there be a connection between the high prices (caused by heavy demand) and the announcement of the Viewliner II contract award?

IIRC, there was no additional congressional capital equipment appropriation for the order. Rather the normal appropriation was being used for the first year. Apparently, Amtrak was able to use "profit" from operations (my definition: Appropriation + revenue - expense) to buy the new cars?

 

[jis]

Could there be a connection between the high prices (caused by heavy demand) and the announcement of the Viewliner II contract award?

IIRC, there was no additional congressional capital equipment appropriation for the order. Rather the normal appropriation was being used for the first year. Apparently, Amtrak was able to use "profit" from operations (my definition: Appropriation + revenue - expense) to buy the new cars?

Another way to put it is that they are using unforeseen additional revenues, beyond what was planned in the budget. It should be noted that the amount committed this year is only $29 million of a total contract that will run upto almost $300 million. Let us hope someone comes through with some appropriation or revenues rise phenomenally next year, or we are in deep doo doo and there will not be too many Viewliners actually delivered in 2012.

it is accurate to say I think that if Amtrak were not charging the fares that it is today, there would have been no Viewliner order this year.

 

[Trogdor]

As far as the rest of it, welcome to the global economy. Overall, we're much better for it.

Depending on what you mean by "global economy" and "overall," I might have to disagree with your assessment.

That said, regardless of one's opinion on whether or not it's a good thing that profit (or minimized loss) motives drive decision-making at nearly all levels of our society, it is not something that Amtrak can do anything about. Amtrak can either play along, or disappear. Amtrak will not lead an economic revolution in this country, nor should anyone expect it to (even if you think that such a revolution is, ultimately, necessary).

 

[had8ley]

Cruise lines substantially discount their inventory prior to each sailing, since they make most of their revenue with the "add-ons" - liquor, shows, shore excursions, etc. Have you ever seen the faces on passengers when they get their bills for what they have signed for while on-board. It is big money for the cruise lines.

Amtrak also has the issue of when to add extra equipment - will the demand be enough to sell out another sleeper or coach? Will it cover the operating costs with the addition of another sleeping car or coach attendant? Will the dining car be able to handle the extra passengers or is it at capacity already? What about the lounge car?

The goal of revenue management is to balance the supply (and price) with the demand and as noted in other posts, if Amtrak is running at 100% they are doing it right. They also have a different problem than the airlines and cruise industry, since not all passengers are going from the origin to the final destination. There are as many legs on an Amtrak route as there are stops. Balancing the inventory and pricing along the routes is vastly more challenging than with the airlines or a cruise line. It is really comparing apples and monkeys!!

Who are the monkeys ??? :giggle: