What will Amtrak do with $800M?

[printman2000]

Your right, we don't always or even often agree, it may be a age difference perhaps. If we really want a successful rail service then the idea of many sleepers filled should be a natural to me. To think that one might sell out too soon, so we better price them higher only supports the idea that they are priced too high if lots more would ride if they weren't. Maybe that is why in the old days they could run whole trains of only sleepers.. If price were the guiding decision, then they would have only needed one car as well.

I am speaking from the position of Amtrak right now, not what I wish it was. Right now, with the number of sleepers they have, I believe they are priced right. If they had enough sleepers to run entire trains of them, then naturally, supply is up so price would go down. They would, as I said before, get the most profit they can get while still filling up the sleepers.

If the sleepers are filling up at the prices they charge now, how can lots more people ride sleepers if they price was less?

 

[sky12065]

If by "maximizing revenue" you mean a goal of cost + reasonable profit then I agree. When I refer to "greed" I am referring to those who would go for cost + all the profit they can squeeze out of you... which to me is ripping off the consumer. Amtrak I agree is doing pretty well right now!

There is no way in the world to define reasonable profit. Everyone would say a different amount. I would define reasonable profit differently. No, I would not say "all they can squeeze from you."

I would word it as the most profit they can get and still fill up the sleepers. That is the way business is run. I guess they mean the same thing, but one is worded as business would word it.

I guess then that we'll have to agree to disagree! The readers can decide for themselves!

Printman, I found this page that I thought you'd find interesting and somewhat amusing. It's on the question of defining profit. I'm not attempting to espouse who is right or wrong. As a matter fact I do think this issue is complex enough where we both can be right and wrong without either of us being completely wrong... or right. Right? Enjoy!

Whoops! Forgot to give the link. Sorry! Make sure to read all responses and not just the first.

http://answers.yahoo.com/question/index?qi...23172220AAQ3tos

 

[Larry H.]

Your right, we don't always or even often agree, it may be a age difference perhaps. If we really want a successful rail service then the idea of many sleepers filled should be a natural to me. To think that one might sell out too soon, so we better price them higher only supports the idea that they are priced too high if lots more would ride if they weren't. Maybe that is why in the old days they could run whole trains of only sleepers.. If price were the guiding decision, then they would have only needed one car as well.

I am speaking from the position of Amtrak right now, not what I wish it was. Right now, with the number of sleepers they have, I believe they are priced right. If they had enough sleepers to run entire trains of them, then naturally, supply is up so price would go down. They would, as I said before, get the most profit they can get while still filling up the sleepers.

If the sleepers are filling up at the prices they charge now, how can lots more people ride sleepers if they price was less?

Printman, please read that it says Many Sleepers filled. I said that because of your comment that if the prices were lower the cars now would be filled and someone who wanted to go at the last minute wouldn't have access, even if it at a huge cost. So I am saying wouldn't lots of sleepers filled be better which of course would mean that many more were able to travel by rail. Yes I know we can't do it with the current set of cars, or even attitude at Amtrak and in Congress. But if the demand were so high as to fill a train full of more reasonably priced sleepers, well for those of us who want to see a resurgence of rail travel, not just a skeleton set of cars and lines, if would be a great day. I am afraid that the powers that be at amtrak are content to run one or two sleepers and not go after the additional business. On second thought, they don't do a very great job of running the few they do, so maybe a lot of sleepers would really be a disaster. I will save you all and not include a list of those sort comings here, most of us know them well.

 

[Ryan]

or even attitude at Amtrak and in Congress. But if the demand were so high as to fill a train full of more reasonably priced sleepers, well for those of us who want to see a resurgence of rail travel, not just a skeleton set of cars and lines, if would be a great day. I am afraid that the powers that be at amtrak are content to run one or two sleepers and not go after the additional business.

I think that's a massive assumption based on nothing more than conjecture. Given the meager budget that Amtrak as worked with for its entire lifetime, I'm not sure how you would expect them to go after that business with nonexistent sleepers.

 

[AlanB]

The difference in our thinking here is that Amtrak is not going to be a profitable business, its a hoax promoted by congress people who wish to stop all rail service. IE, if it doesn't pay for it self we don't need it. Well they don't claim that about highways conveniently. You an I both know that rail is subsidized the world over.

Larry,

IMHO you came very close to hitting the nail right on the head here with this entire problem. It goes just a bit beyond what you've stated, that Congress wants a profitable rail service or that it should stop. Yes, there are those that advocate for exactly that. But there are others who support the idea of subsidized rail service, but not subsidized sleeping car service. Therefore, if Amtrak does work towards maximizing profits on the sleepers, they will surely get cut by Congress sooner or later.

The biggest argument going right now in sleeping car's favor, is the fact that they don't require a subsidy to operate and equally important, actually reduce the subsidy to actually move the passenger from point A to point B, aka the railfare. Put another way, if Amtrak lowered sleeping car prices, the subsidy for railfares would need to go up.

I’m not saying that this is right or wrong, but this is the way it is unfortunately.

 

[Larry H.]

Alan,

Unfortunately then its a rather sad day that those who are in control of the railroads have no idea of what rail travel is about. Its a bit like saying that only Volkswagens can travel on the interstate be cause its state supported and only cheaper cars are allowed. Well then they did just send one Limousine rider home, I wonder if he had to pay extra for the ride?

 

[AlanB]

Alan,
Unfortunately then its a rather sad day that those who are in control of the railroads have no idea of what rail travel is about. Its a bit like saying that only Volkswagens can travel on the interstate be cause its state supported and only cheaper cars are allowed. Well then they did just send one Limousine rider home, I wonder if he had to pay extra for the ride?

Which is precisely why I've long said that the 500+ Congresscritters shouldn't be trying to run a railroad. Not suggesting that they should just hand Amtrak a blank check either. But when they start micro-managing something that they have no clue about, we get stupid funding provisions like "cut the food service losses." Yes, Amtrak choose the way to do that, but Amtrak should never have been forced into such a decision in the first place.

A simple look at history shows that by and large food service cars never turned a profit when the freight's ran passenger service. So how can Amtrak possibly be expected to do so. Furthermore, the shear lunacy of the idea that you've just said to Amtrak "here's a check for $1.4 Billion, but you have to figure out how to plug a $100 M hole in food service. I continue to be reminded of the little Dutch boy sticking his finger into the hole in the dike trying to hold back the flood.

 

[Joel N. Weber II]

I'm not sure I understand why farm subsidies are OK if Amtrak food service losses aren't.

 

[wayman]

I'm not sure I understand why farm subsidies are OK if Amtrak food service losses aren't.

Because agribusiness has a strong lobby and Amtrak doesn't.