United Rail Passenger Alliance

Vol. 2, No. 10 – May 13, 2005

1. Stop that, right now! Once again, Amtrak President and CEO David Gunn, the third of the Transit Trio of Tom Downs, George Warrington, and Mr. Gunn, has appeared on Capitol Hill in front of a Senate appropriations committee and either blatantly or obliquely used the “bankruptcy” word.

   This silliness has got to stop. Either Mr. Gunn needs to be dismissed immediately by the board of directors, or he needs a big muzzle that can’t be removed.

   Mr. Gunn, and his erstwhile confederate, Kenneth Mead, the supposedly impartial inspector general for the U.S. Department of Transportation are once again conspiring to frighten Congress into giving money that will mostly be used for the Northeast Corridor with the threat of bankruptcy of the entire national Amtrak system. This continuing absurdity does nothing to improve Amtrak’s position, does nothing to bolster confidence with the traveling public, and does nothing to add any credibility to anything else Amtrak may be hoping to accomplish.

   Amtrak has more going for it right now than it has had in decades. It has a superb Chairman of the Board in David M. Laney, the first really qualified chairman the company has had in more years than anyone cares to remember. An accomplished attorney who specializes in transactional law, Mr. Laney knows the many ins and outs of the corporate world and how to make things work. His fellow board members, Enrique Sosa and Floyd Hall, are also highly accomplished executive suite businessmen that are accustomed to solving problems and making things work, even in a dysfunctional world such as Amtrak’s.

   Yet, here we have Mr. Gunn resorting to his old tricks of trying to scare someone into giving him more money or he’s going to pull the plug.

   Enough is enough. The world will not end if Amtrak doesn’t get the $1.8 billion that it wants. Wise and clever people will be able to figure out what to do and how to do it with less money. This continuing harangue about bankruptcy is an old and tired song that needs to be retired, along with David Gunn.

2. And, that all brings up the “Acela question.” Whither, Acela? Even if the brakes are replaced in the next couple of months, much more than just the luster has faded from this jinxed Wondertrain. It’s time to make some hard decisions about the future of Acela. It seems highly unlikely that this equipment, the result of $3 billion worth of assorted development and alleged upgrades in the NEC will ever work its full service life. What other unknown problems are waiting for these trains?

   As said before, the Metroliner is a decades old brand name that still has a lot of respect. Even though Amtrak claims it’s losing $1 million a week by running Metroliners instead of Acelas (the big question is, by whose accounting methods are we talking, here?), perhaps its past time to consolidate all premium service in the NEC under a Metroliner (or updated Metroliner) brand that will last for another 30 years, probably much longer than the Acela equipment will last.

   This is not a management problem, or operating problem. This is a marketing problem. In all fairness, by this late in the Amtrak fiscal year, all marketing monies are either spent or committed, and there is little maneuvering room. However, again, cleverness needs to be the hallmark of the day. Amtrak has already begun by using an inexpensive e-mail campaign to known Acela riders and the company has been running some radio ads, too.

   This is a golden opportunity that Amtrak has to redeem itself from a marketing perspective. This needs to be a winner, not another loser.

3. When Amtrak issued its Strategic Reform Initiatives and FY06 Grant Request in April, it provided fascinating reading for Amtrak watchers. Usually documents such as this, coming from Amtrak’s apparently socialist planning department which usually has a corridors-are-the-world, the-national-system-is-unimportant bent (reading most of the planning department’s recent past work clearly indicates that these employees would probably have been much happier planning trains for East Germany during the Cold War than dealing with the modern realities of a capitalist country such as the USA today), are something that could and should be dismissed quickly and easily.

   Not this time. This document shows the heavy influence of the professional businessmen of the board of directors, versus the usual Amtrak socialist rhetoric. It appears that almost every part of this document has the trappings of professional business experience. Yes, there are still parts of the document that apparently the folks in the planning department sorrowfully won the debate for now, but the good outshines the bad.

   Perhaps the saddest part of the document says that for now, Amtrak management does not foresee the splitting of the NEC infrastructure from the rest of the company. This is a huge mistake, best illustrated by the first item in today’s column. The sooner that Amtrak can focus on the operation of a railroad versus the maintenance of bridges and track, the better our country will be and the healthier Amtrak will be for now and into the future.

   It’s not a perfect document, but it’s a good document. As long as Amtrak is fortunate to have this board of directors, we can hope for a better future.