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Amtrak food and beverage service; real facts and figures

August 4th, 2012

The folks on Capitol Hill last week held a hearing in the House Committee on Transportation and Infrastructure about the ongoing costs of Amtrak’s food and beverage service.

The hearing brought out a host of issues and costs; most headlines around the country for the news media which covered the hearing talked about $16 cheeseburgers and Amtrak spending $1.70 for every $1.00 it generates in food and beverage sales.

Some of the results of the hearing were predictable. Amtrak, as usual, will probably go on doing what it always does, ignoring whatever law Congress passes and does what it wants to do, and then screams bloody murder when they are caught ignoring the law. The National Association of Railroad Passengers – Amtrak’s leading wholly owned lapdog organization – will go on blindly supporting everything Amtrak says and does with a straight face, blaming onorous enemies of Amtrak instead of trying to find out real reasons why Amtrak is always in so much trouble. Until NARP leadership, including some truly outstanding people at the top of the organization, understands how much the organization is hogtied and led astray by its paid office executives, it will be difficult to accept any premise presented by NARP.

Let’s take a look at some facts.

Amtrak onboard food and beverage employees are well paid union employees. With benefits and other associated employee costs, the average employee working in a dining car or cafe/lounge car is costing Amtrak in the range of $19 to $25 an hour.

Some people will wrongly look at this as the problem. This is NOT the problem.

A full dining car is the single most expensive piece of rolling stock in a passenger train. More than a coach, more than a sleeper, a whole lot more than a baggage car.

Amtrak dining cars are grossly underutilized because they are open to passengers so few hours of the day. Just about any long distance train hosting a dining car is on the road 24 hours or more. If a diner serves a combination of breakfast, lunch and dinner in that run, the dining car is open maybe 10 hours of that time. The rest of the time it’s closed, and not generating a dime of revenue.

Lounge cars do better; they are usually open from early morning to late evening, with breaks for the lounge car attendant to have meals.

Depending on the onboard service staff, many passengers may never know these cars exist. Sometimes the crews just don’t want to work hard towards the end of a run, they often have no incentive to work to please passengers because they get a paycheck no matter what. As a result, even though every train is equipped with an operating public address system, the dining or lounge car crews do a poor job of promoting their wares and offerings.

In the dining cars, for sleeping car passengers, the lead service attendants – that’s who used to be the dining car stewards – take reservations. Beyond that, not much is done to encourage coach passengers to patronize the diner.

Since diners on trains have finite space and are only open very few hours, Amtrak perpetuates an irritating and unnecessary “railroad tradition” of seating strangers together at a table for four passengers and expect a jolly time to be had by all. Travel writers love to write about their wonderful dining car experiences of making new friends and pleasant meal conversations. They never mention the hordes of people who prefer to eat uninterrupted or in the sole company of their own souls.

Amtrak crews often do this even in diners with light patronage, saying, when asked, that it’s company policy. No, it’s their policy to keep from having to change more tablecloths or walk an extra couple of feet.

For many years, whatever Amtrak pays for an item, such as a can of soda, it follows the standard restaurant industry formula of tripling the cost of the item when it is placed on a menu. So, when a soda costs Amtrak $1.00, it sells that soda for $3.00. That’s fine.

Amtrak dining cars are charged a monthly maintenance fee by the company as a bookkeeping measure. The cost is more than reasonable, and an Amtrak dining car has no extraneous expenses, such as electricity costs (it comes free, from the locomotives head end power system), water or sewer costs (figured into the maintenance costs already), telephones, advertising, etc.

All of the same holds true for cafe/lounge cars.

So, if the food costs are in line with industry standards, the monthly maintenance costs for a dining car are reasonable, the onboard labor costs are fine, and there is no cost associated with purchasing the cars because federal treasury funds pay for the equipment in free federal money, where is the problem coming from?

The only place left is high commissary operating costs and high costs ASSISGNED to food service by corporate headquarters.

For decades, but, particularly under the current Amtrak administration, there has been a dismissal of the long distance routes, and they are treated only as political pawns, which they are in the eyes of Amtrak management. Single trains a day through congressional districts and states keep members of the House and Senate voting for annual Amtrak appropriations. The current Amtrak administration appears to be committed to barely keeping what Amtrak has now in routes, but does everything it can to not expand the system, add frequencies, or do anything else to bolster long distance trains.

As a result of this, we see lots and lots of costs assigned to dining cars – shades of accounting tricks used by the private railroads suffering under the too heavy hand of the thankfully-departed Interstate Commerce Commission in the 1960s – that in the real world would never be assigned there. We see non-onboard employees assigned there, too, all with associated costs. And, we see general overhead costs assigned there, just because they can.

Remember – in the last fiscal year, Amtrak’s IT system was so dysfunctional, Amtrak had no real idea of what costs were assigned where FOR ANYTHING, much less the food and beverage costs.

And, a final thought. Back at the end of the 1990s, on the Sunset Limited, a number of tests of running a 24-hour dining car were successfully completed. The passengers liked it, the employees liked it, the unions agreed to the tests. Revenues were up, employees were less stressed because passengers came into the dining car in a natural progression instead of a rigid reservtions system, and employee tips were up because of passenger satisfaction. After management changes, the experiments died simply because of the new managers saying “not invented here.”

There are many things Amtrak can do to improve it’s food and beverage operations while at the same time (gasp!) providing a better experience for passengers and employees and creating new revenues.

But, as long as the present Amtrak administration is in place, things will stay the same, and only the taxpayers will care. – J. Bruce Richardson

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