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Amtrak Could Turn a Profit for the First Time
- curiousgal 7y agoGood for them. No wonder they're not focusing on cross-country, the US is huge compared to Europe.
- kgwgk 7y agoDepends on what do you mean by "Europe". The continent is slightly larger than the US.
- jcranmer 7y agoCopenhagen is closer to Zurich than Chicago is to NYC. Even Paris/Berlin is closer than Chicago/NYC. The US's major cities are not close to each other, with the exception of the North-East Corridor, and the distances involved are far larger than most corresponding distances in Europe--you have to be talking about trips between Spain and very deep into Russia to start to compare against the NYC/LA pairing.
- deleted 7y ago[deleted]
- kgwgk 7y agoThe East Coast and the West Coast are far away. Because the US are almost as huge as Europe :-)
- tptacek 7y agoSome data: https://news.ycombinator.com/item?id=8713324 https://news.ycombinator.com/item?id=8713324
- briandear 7y agoAn extraordinary bit of data. Thanks for sharing the link.
- curiousgal 7y agoThis is exactly what I meant by my initial comment.
- deleted 7y ago[deleted]
- CydeWeys 7y agoIt's worth pointing out that the intent of transportation infrastructure isn't to turn a profit, but to be a potent multiplier for economic gains in other segments of the economy. There's barely a road in the entire country that's turned a profit (gas and vehicle registration taxes don't come close to covering road construction costs, and of course most roads aren't tolled), yet we still rightly consider roads as being worth it. We should treat our rail, transit, and other transportation infrastructure similarly. Expecting a profit is completely missing the point, but doing so is a nice bonus.
- bobthepanda 7y agoProfits are nice though in that they will finally allow Amtrak to invest in more services and maintaining/upgrading the network, because that money is not coming from Congress any time soon.
- bhk 7y agoComputing is a multiplier, as is communication, etc.. That doesn't mean that providers thereof are exempt from the realities of business, the need to watch expenses and creatively respond to change and competition. I suppose if Intel had been nationalized then they would be loss-making and we would be hearing about how taxpayers should feel good about subsidizing their losses.
- dijit 7y agoIt’s a false equivalence though, rails and roads (and the internet) are like arteries, you can have redundant arteries but it’s wasteful. So free market economics no longer apply. It also leads to natural monopolies.
- bhk 7y agoBecause it's a natural monopoly, they cannot be expected to break even, and therefore deserve taxpayer subsidies?
- 7y ago
- bbanyc 7y agoBig if true, but I don't know whether to trust these figures. The Rail Passengers Association has accused Amtrak of cooking its books - https://www.railpassengers.org/happening-now/news/releases/amtraks-route-accounting-fatally-flawed-misleading-wrong/ https://www.railpassengers.org/happening-now/news/releases/a... - but of course the RPA isn't an unbiased source either.
- yostrovs 7y agoAmtrak is only somewhat successful when it is essentially a regional carrier, like LIRR in New York or Metra in Chicago. When it is a long distance train, it is a miserable failure from the financial side and customer experience. The Northeast corridor acts like a regional route, focusing on commuters, and that's what saves it. People in America refuse to use Amtrak for travel.
- bobthepanda 7y agoAmtrak's long distance service is more akin to the Essential Air Service, in that it connects lots of small, otherwise unconnected rural areas and is not expected to make a profit. Amtrak has always been a company with two halves, and Congress really should just split it to stop this Jekyll and Hyde tug of war about what exactly the company is supposed to do.
- maxerickson 7y agoTo use Amtrak I have to take a bus to Chicago. edit: My mistake, Milwaukee.
- bobthepanda 7y agoIt doesn‘t connect every rural area, the same way that EAS doesn‘t.
- maxerickson 7y agoIt connects cities and passes through rural areas. https://www.amtrak.com/content/dam/projects/dotcom/english/public/documents/Maps/Amtrak-System-Map-1018.pdf https://www.amtrak.com/content/dam/projects/dotcom/english/p... A nice statistic would be some kind of report about travel times, densities and total populations. Looking at the map, there's some people that live at lower density that have a nearby station and then most people that live in metros have a nearby station.
- nordsieck 7y ago
- ykevinator 7y agoI use Amtrak to go to nyc all the time. It's a pleasure. If they (or some scrappy start-up) could halve the price and halve the time, it would be revolutionary.
- empath75 7y agoI take the Acela for work all the time and love it. It’s too expensive for me to take it with my family though.
- dillonmckay 7y agoWhat route do you take?
- bobthepanda 7y agoThe only reason Acela charges so much is that there isn't enough track capacity for all the demand, and the current price is what most profitably fills seats. The estimated cost of an additional two tracks in the Northeast is over $100B.
- dillonmckay 7y agoWhere do you leave from?
- kaonashi 7y agoIt shouldn't be pseudo-privatized and should be further subsidized, the fact that it's become extractionary shouldn't be celebrated.
- djsumdog 7y agoI agree. Almost all nations have their rail subsidized. Really all transport has to be subsidized by the State, going back to the Roman era. Toll highways cover a fraction of operating costs. In most cities, your bus fair pays for 50% or less of the cost to run the bus. States use transport to build commerce, and it's difficult to measure what revenue that generates. Funding needs to be pumped into AmTrak to help expand some of the very limited high speed rail we're just starting to see in the USA, including Florida's Brightline (now Virgin Trains) and the half-canceled California project.
- ronanyeah 7y agoI just used Amtrak to travel across the US as I didn't want to bring my electric skateboard on a plane. It is a very high quality service.
- rayiner 7y agoDid you get there on time?
- deleted 7y ago[deleted]
- jrockway 7y agoI don't think you pick Amtrak to arrive somewhere on time. You bring some books, read them, relax, stare out the window, chat with people in the dining car, and eventually reach your destination. Chilling out on the train is part of your vacation. (I rode the California Zephyr from Chicago to Oakland when I was like 10, and still remember most of the trip. It was amazing, even for an easily-bored 10 year old.) The reality is, intercity trains are not an efficient way to travel in the United States. Most of the important cities are far apart, because it's a very large country with a lot of empty space. If you need to be somewhere, book a flight. It's less expensive and if you give yourself a day of leeway you will probably never be late to your thing, barring some sort of natural disaster. I am a huge railfan but I have accepted that the geography of the US doesn't make train travel as viable as say, Japan. Tokyo, Nagoya, and Osaka are the three largest cities and are comparable in distance between each other like Chicago, Springfield, and St. Louis. If New York was where Chicago is, Chicago was where Springfield is, and LA was where St. Louis is, high speed rail would be enormously popular in the US. But New York and LA are 2500 miles apart, 10% around the world from each other. I even question California High Speed Rail. San Francisco / Silicon Valley and LA are both big metro areas with a lot of money, but SF/LA are 41% farther apart than Tokyo and Osaka. Japan got very lucky that its two largest cities are actually very close to each other. Building the Shinkansen was an enormous engineering challenge, but one that was very clearly profitable. It's so profitable they're building another Shinkansen between the two cities, taking a shorter route and using faster trains. In the US... such a city pair does not exist. OK this is going very off-topic from your exact comment... but it's something I wanted to talk about. Sorry.
- yingw787 7y agoI honestly really like Amtrak, at least on the Northeast Regional. No baggage fees, large comfortable chairs (I thought coach class was business the first time I rode it, then I discovered business class had tables), no real security restrictions (yet), the notion of quiet cars, and nice scenery. Maybe it's because I don't ride Amtrak regularly and so every time I ride it it's a novelty, but I underrated it and it exceeded my expectations every time so far. If you're not going between D.C. and Boston then maybe it'll be different, but if you're riding on the one line Amtrak has to keep operational or it'll die completely, I think it should be fine.
- rolltiide 7y agoI like that the stated travel time is the actual amount of time out of your day You show up in the middle of one city and wind up in the middle of another city Big contrast from airports. But Amtrak is too expensive and slow compared to other developed nations high speed trains, especially in Northeast corridor. Everything I said earlier applies to Japan, and western Europe.
- AndrewKemendo 7y agoI go from DC to Boston weekly and couldn't disagree more. The NE Regional or Acela add, all things considered, anywhere from a 4x - 8x time multiplier over air travel, and is about double the cost on average. Even when I was going DC > NYC years back it was barely worth the trouble, and still more than flying, only benefit being you land right in the middle of NYC and don't have the nightmare transit from NYC area airports.
- yingw787 7y agoI'm not saying there aren't things to like about air travel, especially if you have an axe to grind. Definitely faster, prices are competitive, and they probably innovate faster too given much higher sales volume. But I would say overall I prefer the Amtrak experience, especially if time is not a bounding factor. And it's not always an either-or. I mostly take Amtrak from BWI to Union Station, because flying out of Baltimore-BWI is much cheaper than Dulles-IAD or Reagan-DCA.
- shmageggy 7y ago> “Our biggest challenge is I go testify in Congress and all we talk about is French toast on dining cars or food,” he says. “We aren't talking about the really big infrastructure issues and transportation congestion issues that all the people in this country want a solution for.” This is infuriating.
- progval 7y agoAlmost literally bikeshedding. https://en.wiktionary.org/wiki/bikeshedding#Etymology https://en.wiktionary.org/wiki/bikeshedding#Etymology
- aitchnyu 7y agoI miss the previous team where the issues are literally titled "X bikeshedding". Much better than having meetings where bikeshed issues get recycled for months.
- closeparen 7y agoI disagree, the Amtrak dining car is a sacred piece of Americana and its loss is a big deal. There was a good HN thread about this a few months ago [0]. [0] https://news.ycombinator.com/item?id=21039093 https://news.ycombinator.com/item?id=21039093
- gexla 7y agoIf Richard Anderson is walking with a bit of a swagger today, now you know why. Congrats to him. We should put this guy in the White House. He has done the seemingly impossible. > “Our biggest challenge is I go testify in Congress and all we talk about is French toast on dining cars or food,” he says. “We aren't talking about the really big infrastructure issues and transportation congestion issues that all the people in this country want a solution for.” Of course! It's a waste of time talking to these people. Please keep the subject on french toast, because if they're going to screw something up, let it be a breakfast dish. And lets extrapolate this out to all other subjects and consider how they would do with all the policies the progressive left are dreaming up.
- colin_fraizer 7y agoIt's worth pointing out that the financial statements may be highly misleading. https://www.cato.org/blog/amtrak-guilty-securities-fraud https://www.cato.org/blog/amtrak-guilty-securities-fraud
- campuscodi 7y agoI'm pretty sure they'll find a way to lose more money by next Saturday.
- xvilka 7y agoStill, when you travel with trains in US, it's like traveling back in time compared to Europe and Asia.
- microcolonel 7y agoThat's largely because automobiles, buses, and airplanes are better suited to the geography of the United States. There are corridors and regions where trains make sense in the U.S, but many rail lines went from necessary to obsolete with the natural progression of technology. AmTrak was created when the private passenger rail operators were failing, and they were failing for a good reason: demand for long-haul passenger rail service declined sharply when better alternatives entered the market. The one thing that rail can do better than these other forms is comfort and service, but for the vast majority of people, they would rather be able to afford to make it to their destination.
- jorblumesea 7y ago> better suited to the geography of the United States. China has a similar geography to the US, and similar sizes and run lengths of their high speed space. The US has decided to build roads and highways instead of investing in other transit options. It's not that it makes "more sense", it's that the US has intentionally built things this way, for a variety of corporate and historical reasons. > many rail lines went from necessary to obsolete with the natural progression of technology. What? You mean, except for literally every other developed country has well developed rail lines that transport billions of people with levels of unmatched efficiency? > when better alternatives entered the market. Only because the market was intentionally weighted against that form of transit.
- microcolonel 7y ago> China has a similar geography to the US, and similar sizes and run lengths of their high speed space. China has extreme restrictions on domestic flights, and a great deal more population; and on top of that, so much is different about the way things are done in China, the state will just bulldoze things for looking too "towny". > What? You mean, except for literally every other developed country has well developed rail lines that transport billions of people Britain is a developed country with well developed rail lines, but probably few there would tell you that it's great right now. Some of the failure there can be attributed to their poorly-designed pseudo-privatization of the trains and crews themselves (but not the rails or facilities, which remain national), but a big part of the reason that was politically viable was that the rail services weren't all that great when they were national either. France's TGV is really cool, when the operators aren't on strike. Up here in Ontario, we have one relatively useful rail corridor, but the further you get from Toronto, the less the passenger load. On my morning train from Hamilton, there are (charitably) a couple dozen passengers on the whole train for several stations. As for national rail in Canada, it is rare to hear that anyone has used Via. I've used it once in my life, but I found out later that a bus on the same route would have been faster and dramatically cheaper. Long-haul rail networks are attractive to politicians because of what they represent, but to transport consumers, the reality of long haul passenger rail is that it is rarely the best option. When passengers bear the cost, long-haul passenger rail is, by natural means, rarely the best option in the U.S. > with levels of unmatched efficiency? "unmatched" by what? High speed rail is extremely capital intensive, and expensive at the point of sale, and that's when you don't have any trouble clearing land for it. In the U.S, most of the viable places for passenger rail already have rail lines, but they are not appropriate for high speed rail. Conventional passenger rail is too slow to attract fares, and is still very expensive. Dude it's alright to like trains, trains are cool; but none of what you said justifies the subsidies that would be required in order to make a comprehensive U.S. long-haul passenger rail network that's worth using, and no policy would make it worth the cost. If you have some brilliant business practice, policy, or idea that will change this, I implore you to develop it! :- )
- droithomme 7y ago> Have you ever actually taken Amtrak? Yes I have and your statement is correct. Amtrak is almost entirely dysfunctional but rail as a concept is not dysfunctional and actually works in many other countries. It's like healthcare, which is an absolute shitshow in the US, however in the rest of the developed world it's not a shitshow. Likewise with the military. What is it about the US that makes so many fundamental services needed for the functioning of society into shitshows?
- TylerE 7y agoIt'll never work in the US. Outside of a handle of locations, we just don't have the population density. On the coasts maybe, but even high-speed rail is just too slow for the west and mid-west. The sweet spot for rail seems to be journeys of 100-300 miles... lots of even major US cities don't have another major city in that radius.
- jessaustin 7y agolots... I've got Denver, SLC... where else?
- zachsnow 7y agoI am from Minneapolis. I’m trying to imagine a fast rail connect to Chicago as being better than driving. Once in Chicago I think I’d like to have a car? It’s only a day’s drive away so I imagine I’d rather drive. Basically the net is that the US is car centric and it will be a lot of work to change that. (Which I’m on board for, it’s just not easy or quick.)
- jessaustin 7y agoIf the rail line were really straight, Milwaukee would be right at 300 miles from the Twin Cities. (I agree, Des Moines doesn't really count as a "major city".)
- UserIsUnused 7y ago
- chiefalchemist 7y agoAmtrak's lack of profitablity isn't the issue per se.The lead here is who ultimately benefits. These subsidizes don't benefit the masses. They are an entitlement for those who don't need entitling.
- TYPE_FASTER 7y agoShort flights are fine until they’re canceled and you go to the rental car counter and they charge you $500 for a day rental because, hey, supply and demand amirite?
- samstave 7y agoI've commuted on Amtrak quite a bit - sac to bay area... And I have looked into using them even more - but their is a litany of reasons why its impractical: THeir ticket prices, staffing, schedules, lack of full-through-connection services, and delays all but make it hard to use as a service for all but one specific type of commuter. Lets look at staffing. They will know that its the commute hour; yet they will schedule ONE ticket agent at the counter in a major station - who has no incentive to be efficient with their tasks, and have made myself and MANY others miss the trains they were trying to get to. When you complain to the staff, they immediately take an attitude. Once when I asked why they only had one ticket teller during the major rush hour, the ticket teller didnt answer me, but called the Amtrak police to come question me. (I was being polite - and asked matter-of-fact why they would make such an oversight.) Pricing: The tickets are way over priced for the service. Also, lets look at the "rewards" benefit - and the "10-pass" packets. 1) The rewards - it costs $19 to go from Sac to Martinez. You get (2) reward points per dollar you spend. For that same $19 leg to redeem points for a "free" ticket costs 900 points. -- That means you have to spend $450 to get ONE $19 reward. 2) A 10 pack ticket expires after 45 days. No matter what. Last holiday season - with validations, office shutdowns, holidays etc - there was no way to use the tickets I had until after the new year - yet they would "expire" on 12/31 - no matter what. Their rewards points often fail to show up on your account - and its a tedious process to rectify - and even when you do rectify, it take more than 3-weeks for them to hit your account. The pricing to go any distance, is just absolutely too high. Now, the good things about Amtrak: They have power, wifi and a snack car. The cars are clean (generally), and the ride is smooth - and actually faster than driving (more relaxing at least) along 80. --- I really want Amtrak to succeed - but I wish they would address the problems they do have.
- greglindahl 7y agoYou appear to have some odd expectations. I can see why they called the cops on you.
- samstave 7y agoMy expectation is that when there are 40 people in line and its rush hour during a work week, and they know this every single day, that they have employed more than a single person to man the ticket counter. I can see why you’re to obtuse to understand.
- raviolo 7y agoI hope one day we stop comparing rail to cars on passenger-mile basis - like infrastructure costs per passenger-mile. These are apples and oranges. There is zero similarities between riding on modern trains and driving. I’ve taken hundreds of trips, anywhere between 2 and 8 hours, on TGV, ICE, and Eurostar trains in Europe. I loved it every time and came out refreshed even after longer trips. At times when I wanted to get work done (probably 60-75% of total time spent on trains) I was as productive - likely more productive, due to lack of distractions - as at the office. In contrast, I don’t think I can remember any road trip lasting more than 2 hours when I could say I enjoyed it; many times I was so exhausted that I needed rest upon arriving to destination. So, if we are going to try to fit this into some sort of economic model let’s not forget about countless billions of hours of productivity loss due to people stuck behind the wheel staring at traffic. Not to mention both emotional and physical strain associated with driving (nope, can not stand up when you like, or walk over to the buffet car for a coffee), respective health care costs, and more productivity losses. Once we do that, the picture will be very different. It’s sad we in the US haven’t realized this yet.
- ikawe 7y agoFTA > The host railroads have been obligated to give the company preference over freight trains so Amtrak can run on time, but that statute has not been enforced, he says. Anyone know the details on this? It’s something I’ve experienced to a degree and a complaint I’ve heard from other riders.
- pedantsamaritan 7y agohttps://www.law.cornell.edu/uscode/text/49/24308 https://www.law.cornell.edu/uscode/text/49/24308 http://blog.amtrak.com/2019/05/why-are-amtrak-trains-delayed-by-freight-trains/ http://blog.amtrak.com/2019/05/why-are-amtrak-trains-delayed... https://thehill.com/policy/transportation/270612-amtrak-protests-move-to-prioritize-freight-trains https://thehill.com/policy/transportation/270612-amtrak-prot...
- arbuge 7y ago“Where we want to be as America's railroad is to cover all of our operating costs through our revenues,” [the CEO] says, “and then use the grant that we receive from our owners, the United States government, to invest in the infrastructure, the rail infrastructure across America.” That's some unconventional accounting. Most GAAP accountants would tell you that capital investments should be amortized over their expected lifetime, with the first depreciation hit in the year they're made. That would of course mean an additional expense to cover before calling yourself profitable.
- perspective1 7y agoIn that quote the CEO's describing operating cash flow, a GAAP measure. Nothing about it is unconventional. And it includes real-world depreciation to a large degree since maintenance costs are part of operating expenditures. The problem is the article's author omitted discussing profit per se, not that the CEO's goal is having positive operating cash flow.
- rossdavidh 7y agoCompare to bus companies, where the infrastructure is almost entirely not even their problem. The roads are simply dealt with by the government (built by private companies, who win contracts from the government). For whatever reason, that's not how we do rail infrastructure for the most part. So, one could argue that Amtrak's rail infrastructure _should_ be entirely off-budget, because really it shouldn't be part of Amtrak at all, to make a comparison to bus companies more valid.
- jorblumesea 7y agoWhy do we care about public transportation turning a profit? The benefit of a good transit network is massive and far above simply the fare fees.
- Shivetya 7y agoIt is a lie. Counting subsidies from eighteen states as revenue does not make you profitable and Amtrak does exactly that. Plus they have such a huge backlog of repairs and maintenance so any "profit" claims are meaningless when you keep putting off maintaining your system and cars. However they make sure where the most noise is where the most investment goes. Plus fleet age is a real problem[0] and requires billions of investment to bring that up to date I love trains as much as the next person but Amtrak isn't profitable and they don't strive for actual profits because they know they are protected. [0]https://www.bts.gov/content/age-and-availability-amtrak-locomotive-and-car-fleets https://www.bts.gov/content/age-and-availability-amtrak-loco...
- WhompingWindows 7y agoWhat happens if we consider the massive subsidies given to fossil fuel companies -- Are they still profitable, when you factor in the massive damage their products are inflicting?
- TheHypnotist 7y agoWell now there is no excuse for not upgrading the northeast corridor.