Wasting A Crisis

By Jim Mathews / President & CEO

We’ve been saying for a while now that Amtrak’s move to three-times weekly service is penny-wise and pound-foolish and that by running shorter consists 57% less often they’re leaving badly needed money on the table. What’s worse is that until now long-distance routes have been consistently the largest single contributor to Amtrak’s revenues in every single month since the coronavirus crisis began.

Amtrak is focusing on avoiding cost while throwing revenue overboard and kneecapping the long-distance routes as they do it. They’re doing this even as Amtrak’s superlative on-board health protocols and the promise of socially distanced travel make Amtrak trains even more attractive in some ways than they were before the pandemic began. Right when a whole new cohort of eager novice riders is coming to Amtrak’s door ready to pay their fares and ride the trains, Amtrak is turning them away.

The coronavirus crisis is sending new travelers to Amtrak in high numbers, driven in part by Amtrak’s aggressive marketing of itself as a safer and more distanced alternative to other kinds of travel. It’s the perfect moment. But with shorter trains and fewer of them, Amtrak is squandering the opportunity to show its unique value. They’re wasting the crisis.

The proof comes in the form of sold-out trains, and we said a couple of weeks ago that it’s clear that even a sold-out sleeper with 15 rooms occupied at better than $800 apiece isn’t enough to entice Amtrak to get past an aversion to paying an extra Sleeping Car Attendant for the trip.

But you don’t have to take my word for it. Once again, Trains magazine’s Bob Johnston is doing yeoman’s work building a chronicle of missed opportunity, documenting the ways Amtrak is leaving money on the table.

Based on first-hand reporting from on board the California Zephyr, the Coast Starlight and the Empire Builder, Johnston today confirmed that “it’s easy to see how a cost-focused management team’s limited interest and experience in maximizing revenue and customer satisfaction is shortchanging all the unique elements rail travel has to offer and turning away business with reduced capacity.”

No point in my repeating the story here, you should go read it for yourself. I highly recommend it.

But we at Rail Passengers have been sounding that alarm in Congress for many months and it’s clear they’re getting the message.

Earlier this year we helped get the House to include authorization language that would revamp Amtrak's Board to make it more representative of, and responsive to, the communities Amtrak serves and the people who pay their fares and ride the trains. Based on some conversations I’ve had yesterday and Tuesday, I am feeling even more confident that the Senate is going to embrace Board reform as well.

Last week Senate Commerce Committee members, Republican and Democrat, each took turns questioning Amtrak’s decision to cut service back to three times weekly on long-distance routes. In a rare display of non-partisanship (I won’t even use the term ‘bipartisanship’) they supported each other in their mutual admonishments to Amtrak CEO Bill Flynn in the witness chair that the Senate fully expected Amtrak to bring back daily service.

In my own testimony for that hearing, I told those same Senators: “To put it directly and bluntly: despite the bi-partisan support Amtrak has received from this Committee and its members, Amtrak today faces a crisis to its very existence – a crisis imposed by the continuing coronavirus pandemic and its knock-off effects on travel and the larger economy, but made worse by decisions at Amtrak itself. Moreover, the effects won’t be confined to Amtrak. As I testified before the House Transportation and Infrastructure Committee’s Rail Subcommittee on September 9th, our Association’s economic-modeling suggests that Amtrak’s COVID-coping tactic of dropping daily service will hurt Heartland America’s economies to the tune of at least $2.3 billion while saving Amtrak less than $213 million.”

My testimony also highlighted the unintended consequences Amtrak faces from this decision.

“Worse yet, Amtrak may find it harder to restore daily service than management expects,” I told Senators. “Furloughs will force skilled employees who run the trains to re-qualify in their crafts before service can return, and some employees may not come back. Unless rolling stock is stored with great care and continuing maintenance, coaches, sleepers and baggage cars will deteriorate while parked, demanding reconditioning before return-to-service and potentially permanently removing some assets from the fleet. Host railroads over which Amtrak operates are free to thumb their noses at Amtrak’s insistence that the service reductions are temporary, treating them as ‘indefinite’ or even permanent reductions. This would force Amtrak into a lengthy negotiation process that could even mean a trip to the Surface Transportation Board, imposing further expense and delaying service restoration for millions of Americans who rely on that service today.”

Rail Passengers shared one such host-railroad response with Committee staff and Senate leaders, and we remain concerned that more may emerge soon.

“Amtrak has also reduced capacity on long-distance trains in order to avoid paying for an extra crew member for added cars,” Rail Passengers told Senators. “Trains magazine recently reported that Amtrak is experiencing near-capacity or sellout ridership on long-distance trains as it begins its shift to triweekly operation, but even with sell-outs extending for many weeks and travelers clamoring for socially-distanced travel options like Amtrak Sleepers, Amtrak won’t add capacity. Management is choosing instead to forego badly needed revenue. While Amtrak has cut 57% of all long-distance departures, the numbers are actually much worse for sleeper car capacity. The Lake Shore Limited, for instance, has gone from 14 sleepers (NYP/CHI) per week to three per week—a 79% sleeper inventory reduction. Retired package-tour operator Carl Fowler, a former member of the Rail Passengers Association Board, argues that with the revenue generating potential of Sleeper car fares—a sold-out sleeper in normal times can gross 2-3 times the revenue of a coach car in normal travel conditions—Amtrak’s refusal to add Sleeper cars to consists is leaving money on the table.”

“Added to this are persistent technical glitches plaguing Amtrak’s online reservations system, which have the effect of further discouraging riders from booking trips at a time when Amtrak can use all the revenue it can,” we told the Committee. “I must share the growing sense of alarm among rail travelers, my own members and leaders in Amtrak-served communities over Amtrak’s diminishment of their essential service.”

The Senate remains our best avenue in the short term for restoring service. Don't let up the pressure! Keep calling and writing and emailing your Senators to let them know you need, want and demand daily service.