– OVERVIEW POINTS –
The successful long distance train of the future
- will look very different from today’s Amtrak long distance train.
- will look more like the successful trains of the past
Change in operational structure
- Today: A single company owns, operates, markets
- Tomorrow: Based on Franchise Structure
Franchise Structure
- Umbrella company like Amtrak for Marketing, Ticketing and Service Standards
- Other companies, acting like owners, provide capital, equipment, and operations under those Service Standards
- This is a proven model over several decades in hospitality and travel business
Thumbnail History of Passenger Transport
- Historically, Rail Passenger Service was a Successful Private Business
- Private Business could not compete after World War II due to continuing Regulation and Taxation in an era when unprecedented Government Funding was given to Roadways, Highways, and Airways
- Today, new Highway construction has nearly ceased, and Profits in the the Airline Industry are Scarce
Driven to Succeed
- All Modes — Rail, Road, Water, and Air — should benefit from Appropriate Levels of Government Involvement in Infrastructure
- The Franchise Model of Passenger Trains maintains some Government involvement in Infrastructure
- The drive and rewards of capitalism are always stronger than the drive and rewards of government control
Surprising Demographics
- A late 1990s passenger survey on one Sunset Limited train showed:
- On board were four Ph.Ds, and a high number of American Express Gold Card holders
- Average sleeping-car passengers were traveling for pleasure, well educated, and willing to spend money on accommodations and amenities.
- Coach passengers tended to be younger, travel a shorter distance, and be traveling for purposes other than leisure travel.
Premium Travel Already Proven Success
- American Orient Express
- Rocky Mountaineer
- VIA Rail Canada’s trains such as the Canadian
What Makes Premium Travel Succeed?
- Why are Americans are willing to embrace long distance rail travel at what many consider to be a premium price?
- Comfortable accommodations
- Good food
- Interesting amenities
- Offerings similar to those of popular upscale cruise ships.
Amtrak In Continuing Identity Crisis
- Contradictory Goals
- As an agency of government, Amtrak is subsidized by the government, and therefore should serve the lowest common denominator of passenger
- Yet, high revenue first class passengers, particularly on long distance trains, pay large fares that help pay for other, low revenue services the railroad operates
- Amtrak has never been able to come to grips with these two profiles
- There has never been a consistent product that attracts repeat, high revenue passengers
Equipment Limitations Reduce Flexibility
- Historically, railroads kept a large variety of rolling stock, tailored to their routes and services
- Amtrak’s small roster of passenger cars is further diminished by a large percentage which are out of service or waiting to be repaired
- Amtrak has concentrated on a few equipment types with system-wide standard configuration, and little regional variation in services
- Lack of seats to fill demand, lack of flexibility, and limited service offerings contribute to the loss of many revenue opportunities
Concentration on First-Class
- Future passenger service will concentrate on first-class passengers
- First-class passengers generate much more revenue
- Additional expenses for added service will be met through fare structure
Three Classes of Coach Service
- Premium Long-Distance;
- Standard Long-Distance;
- Short-Distance.
Coach Services Will be Tailored to Market Segment
- Families who have needs associated with children
- Senior Citizens with more leisure time, disposable income, and who seek better comfort and service
Example Future Passenger Train
- Locomotives
- Up to fifteen or twenty Passenger Cars, comprised of:
- Baggage Car
- Three to ten Sleeping Cars
- Two Dining Cars
- One Lounge Car
- One Recreation Car with facilities for Children and Adults, and a Gift and Sundries Shop.
- Three to five Coaches
Comparison to Today’s Average Amtrak Train
- Typical Amtrak train today has nine cars
- Train of the future will have fifteen to twenty
Advantages of Operating Much Larger Trains
- The costs of operating a train do not double, when the length of the train doubles.
- Costs increase only incrementally
- Fixed costs (management, stations, dispatching, host railroad train-miles) change very little with added train length
Sleeping-Car Services to be Offered
- Exclusive bedroom cars, including Drawing-Rooms for three passengers. Today, similar accomodations typically sell out first.
- Combination Cars containing Bedrooms (with two beds) and Roomettes (with one bed)
- Combination Bedroom, Drawing Room and Lounge Cars
- The First-Class Lounges will provide
- Continental breakfasts
- Light refreshments during mid-morning and afternoon
- Revenue alcohol service
- Evening dessert service
- One Lounge area provided for quiet reading, with no food or beverage service
- 24-hour room service, meal and beverage service, available to all sleeping-car passengers
Coach Services to be Offered
- Premium Long-Distance Coach
- A completely new class of coach service
- Fewer seats, in smaller groupings, for a quieter and more pleasing setting
- A small self-catering Lounge area will offer light food and beverages
- Newspapers and snacks will be provided
- Meals included in the ticket price
- Upgraded restroom facilities including a Shower will be available
- These Cars will be located directly adjacent to the Sleeping cars
- Standard Long-Distance Coach
- Similar to current offerings
- Interiors reconfigured to provide several types of seating groups
- For families with children
- For groups of three or more
- Short-Distance Coach
- Similar to current offerings
- Seating area split into two sections for lower noise level
Dining Car Services to be Offered
- One traditional diner
- White linen service
- Open continuously from 6 A.M. to 10:00 P.M.
- Primarily services Sleeping Car and Premium Coach Passengers
- Available to all passengers
- Prices and menu offerings similar to upscale restaurants
- One Mid Level diner
- Open 24 hours
- Prices and menu offerings similar to Denny’s chain
- Placemats replace tablecloths
- Counter and take-away service available
Lounge Car Services to be Offered
- Distinct from the Lounges in the First-Class Cars, this will be aimed primarily at Coach passengers
- Snack and beverage service
- Meals or sandwiches are offered in the 24-hour dining car, not the Lounge
Recreation Car Services to be Offered
- Gift and Sundries shop, as found on Cruise Ships
- A small Video Arcade
- A glass-enclosed Children’s Play Area which can be monitored by Parents
Passenger Experience Drives Return Business
- The Railway Experience begins with arrival at the station, through boarding the train, and ends only upon departure from the destination station
- From Students to Professionals to Families to Senior Citizens, the passenger train of the future has something for everyone
- Travel at High Speed is not critical; instead, the service must be well designed and executed
Moving To Successful Operations
- Today’s Long-Distance trains are successful, on the basis of actual operating costs
- Enormous corporate overhead, and maintenance of the Northeast Corridor, are added to long-distance operating costs, making them appear to lose money
These Future Trains Can Succeed Even Where Today’s Do Not
- Restructure the equipment, with accomodations better able to meet a variety of needs
- Restructure the offerings, with on-board services for a better passenger experience and more revenue opportunities
- Restructure the marketing, with fares and services to match different budgets and travel styles
- Enlarge capacity to meet demand
- Expand revenues much faster than expenses