United Rail Passenger Alliance

Vol. 2, No. 27 – September 28, 2005

1. Memo to Senator Kay Bailey Hutchison of Texas: No good deed goes unpunished.

   Senator Hutchison, one of the brightest stars in the United States Senate and one of Amtrak’s national system continual greatest supporters has been shot in the back by Amtrak.

   Using the pretext of Hurricane Rita’s eminent arrival in Texas, Amtrak cancelled all long distance train service into Texas, including the Texas Eagle and Sunset Limited. The Heartland Flyer, between Forth Worth and Oklahoma continued to operate. Some runs of the Sunset were outright cancelled, and the Texas Eagle became an all-coach train running between Chicago and St. Louis, instead of its regular route of Chicago – St. Louis – Little Rock – Dallas – San Antonio. The Sunset was already truncated into too short of a route between Los Angeles and San Antonio due to the devastation in Louisiana and Mississippi from Hurricane Katrina.

   So, the announcement was made, Amtrak wouldn’t be serving Texas due to the latest emergency due to the hurricane.

   Oops. It seems that in a conference call of Amtrak managers, originating in CNOC in Wilmington, Delaware (Amtrak’s national operations center) on September 22nd, a decision was made PURELY for economic reasons to cancel and truncate these trains. In other words, Amtrak managers saw an opportunity to allegedly save a few bucks by not running trains, and instead of saying this, they blamed the hurricane-induced emergency instead, knowing there was no alternate transportation available for these passengers. Amtrak chose to ignore its mandate to run trains to save money (much of which originates in the federal treasury as subsidy and free federal money, so no shareholders or owners benefited here) and make its bottom line look better.

   Never mind the impact on furloughed employees. Never mind the impact on stranded passengers. Never mind the impact on Amtrak’s image as a part of a national domestic transportation network. Amtrak managers decided to allegedly save a few bucks, plus give up the passenger revenue, which never seems to matter when you have an open faucet of free federal monies.

   Senator Hutchison has been too great a friend to passenger rail to be treated this way, much less have her constituents in the form of passengers and Amtrak employees treated this way. Once again, with Amtrak, if it doesn’t impact the Northeast Corridor, it must not be important.

   This is yet another example for Amtrak’s board of directors that the current hired management help team has got to go. If they are no better stewards of their charge of running a national passenger rail system than this demonstrates, then it seems nearly impossible to keep requesting funds to keep Amtrak going in the future. This board of directors has too many good people on it to tolerate such abuse of the traveling public by their employees. Heads need to roll in Amtrak headquarters and national operations center.

2. The continued drastic truncation of the Sunset Limited is having a huge impact on Amtrak employees, unseen by the traveling public. If no train is running east of San Antonio (and this train could easily turn in Houston, instead, not to mention how it could easily operate between Orlando and Mobile, Alabama on the east end), then onboard services jobs are changed (and shortened), and train and engine crew jobs just simply disappear, along with paychecks. Add station employees and some other support personnel, and suddenly a lot of lives are changed because of Amtrak’s very bad decision to run the Sunset only between Los Angeles and San Antonio. One can only hope the unions are raising sand over this.
3. Let’s talk about something positive for a moment. Amtrak has stepped up to the plate and hit a home run with the reinstatement of fare hikes for multi-ride commutation tickets on the NEC. The new plan offers a better schedule for fare hikes to allow riders in the NEC to adjust their commuter budgets over a longer period of time. Here is part of their press release from this week, edited for space.
   

   “September 27, 2005: Amtrak … has made modifications to its previously announced fare increases and will implement them in stages beginning Tuesday, October 4.

   “The fare plan is an important component of Amtrak’s FY06 budget. …

   “Three changes will take place beginning next month: a general fare increase will be implemented on most trains; discounts on Northeast commuter tickets will be reduced and standardized in stages; and some trains in the Northeast will begin to be revenue managed, in part to provide passengers with reduced-fare options for off-peak travel.

   “The first change will take place on October 4, when a general fare increase averaging $3 to $4 will be implemented. As such, fares across the country will increase 5-7% on most trains …

   “The second change, which applies to commuter tickets, will begin on October 16. In response to suggestions and comments received over the last few weeks, Amtrak will reduce the discounts on the commuter tickets in two steps with the first half of the change on October 16 and the second half in February 2006. The changes are going into effect on October 16 to provide passengers with sufficient prior notification. Amtrak serves about 2,000 Smart Pass monthly passengers in the Northeast Corridor, most of whom commute between Pennsylvania, New Jersey and New York.

   “The current monthly fare is discounted at approximately 70% for commuters – the deepest discount in the industry. It will be adjusted to allow passengers to enjoy approximately a 60% discount starting October 16, reducing the previously announced fare increase in half. In February 2006, the monthly discount will be adjusted to 50%. At both a 50% and a 60% discount, the monthly Smart Pass fare will remain the largest offered to commuters by any railroad.

   “Smart Pass 10-trip tickets will be adjusted on October 16 to provide passengers with a 20% discount.

   “The third overall change will take place on October 4, when Amtrak will begin to revenue manage some trains in the Northeast Corridor to better match fares to demand periods. Those trains include Regionals, Empire Service, The Vermonter, The Adirondack, the Springfield/Hartford Shuttles, and Keystones between Philadelphia and New York. While the standard fares for these trains will increase 5% … passengers with flexibility to travel at off-peak times will be able to take advantage of lower fares.”

   One can still hear the whining of NEC passengers who believe government at all levels has an obligation to provide cradle to grave services at deep discounts or for free. Sorry folks, welcome to the real world where the rest of us have to pay our fair share. If you want cheap transportation, go via your regional commuter railroads. Amtrak never should have been in the commuter business in the first place, and it is to be roundly commended to taking this long awaited step to get itself out of that business and concentrate more on its core business of long distance, intercity train travel.

4. Amtrak apparently remains a company in conflict with the latest silliness regarding dining cars. The most recent less than brilliant ideas for decreasing food service costs is to combine diners and lounges into one car, with neither service destined to work well. A few full service dining cars will remain, but the plan seems skewed towards heated pre-selected tray meals and not much selection of food service for passengers.

   The old saying goes, those who do not know history are doomed to repeat it. That holds oh, so true for Amtrak. This concept was tried once before about 15 years ago, was a dismal failure with passengers then, and will be a dismal failure now.

   Passengers are on long distance trains for often 24 hours or longer, with no choice in food service. When you eliminate restaurant service in favor of a version of fast food, the passengers will generally rebel, and wonder why they ever bothered to buy an Amtrak ticket in the first place, as well they should.

   Amtrak seems to always look at things the wrong way (which often happens when you have a transit-oriented management attempting to run a passenger railroad). Right now, Amtrak has launched a wonderful new upgraded service on the Empire Builder, between Chicago and Seattle, just the opposite of what they are trying to do with the dining cars under this bizarre new plan. How can Amtrak justify one program alongside the other?

   Instead of always trying to cut costs, the real answer is the simply market the trains and services better. Considering that practically no marketing at all is done outside of the NEC, this wouldn’t be difficult to achieve. It can optimistically be said that if Amtrak EVER bothered to market itself properly, and stopped making itself the best kept secret in all of these several united states, then it wouldn’t have enough equipment to handle the passenger demand. What a concept.

5. Let’s do something different from Amtrak: let’s be honest with each other. Amtrak always blames all of its problems on the national system, and leads everyone to believe that if only the Holy NEC were allowed to proliferate, and the national system went away, then the world would be a wonderful place. If you can still keep you lunch down after that thought, read on.

   Amtrak said in its July monthly report to Congress that 43.2% of its farebox revenue came from the NEC, which means that other trains, such as the national system generated the majority of the income, or 56.8% of the revenue.

   The reality is, the NEC has too many trains. There are close to 80 trains a day running on all or parts of the NEC between Boston and Washington, not counting long distance trains that use the NEC as part of their routes.

   Are that many trains really necessary? The simple answer is “no.” As a modest beginning, the NEC could lose a full third of its frequencies and still have a robust operation that would more than serve the NEC passenger base. Look at what happened when the Acelas were out of service this late spring and summer due to brake problems. Somehow, riders adjusted, and Amtrak didn’t go into a negative cash position as the hand-wringers had predicted. Amtrak has announced it will end the year with $120 million in cool cash on hand, not the $40 million it had previously estimated.

   As Amtrak is constantly finding unpleasant ways to hack and slash at the national system, it needs to first look at the NEC. Too many trains are run for too many constituencies. Why can’t there be three classes of service on each train? Why do there need to be multiple departures each hour? When can’t fewer, but perhaps longer trains get the job done while still maintaining good service?

   When Amtrak comes to the cold reality that it is constantly backing the wrong horse by putting all of its financial eggs into the NEC basket instead of the real source of growth and revenue on the national system, then Amtrak will start to turn around. Until that happens, Amtrak will remain a broken and unfixable company that does a disservice to its passengers, employees, and the American taxpayer.

6. The Associated Press reported last week that Paul Reistrup, one of Amtrak’s first presidents (from 1975 to 1978), now favors creating an operating company that would run Amtrak trains. Mr. Reistrup said the company would use private money to buy new locomotives and cars, and set aside part of ticket sales for a capital fund.

   Mr. Reistrup is soon to be the next chairman of Railway Service Corporation of Delaware that is involved in developing the private operation of rail passenger services.

7. A new white paper, Concepts of the Successful Long Distance Train of the Future, is now available on the UPRA web site, at http://www.unitedrail.org/pubs/20050920.html