Past Rail Performance Tells Us All We Need To Know About The Future Of High Speed Rail

In light of the Conductor-in-Chief’s focus on rail as the path to seizing the future by releasing our hold on some $53 Billion, I thought I would take a look at what past performance tells us about the possibility of decent future performance in the rail context.  As you might expect, Amtrak is a terrible money pit.

Subsidy Scope, an initiative of the Pew Charitable Trusts, took a close look at Amtrak in 2009.  This is what it found:

Forty-one of Amtrak’s 44 routes lost money in 2008 with losses ranging from nearly $5 to $462 per passenger depending upon the line, according to analysis by Pew’s Subsidyscope.

The line with the highest per passenger subsidy—the Sunset Limited, which runs from New Orleans to Los Angeles—carried almost 72,000 passengers last year. The California Zephyr, which runs from Chicago to San Francisco, had the second-highest per passenger subsidy of $193 and carried nearly 353,000 passengers in 2008. Pew’s analysis indicates that the average loss per passenger on all 44 of Amtrak’s lines was $32, about four times what the loss would be using Amtrak’s figures: only $8 per passenger. (Amtrak uses a different method for calculating route performance).

The Northeast Corridor has the highest passenger volume of any Amtrak route, carrying nearly 10.9 million people in 2008. The corridor’s high-speed Acela Express made a profit of about $41 per passenger. But the more heavily utilized Northeast Regional, with more than twice as many riders as the Acela, lost almost $5 per passenger.

This link has a neat interactive map showing the ridership and profit/loss on each of the routes.

In part, Amtrak loses money because of an expensive unionized work-force:

Another problem that Amtrak management deals with is an expensive and inflexible workforce. Amtrak has about 19,000 employees, about 86 percent of whom are covered by collective bargaining. Compensation represents almost half of Amtrak’s total operating costs. The average Amtrak employee earns more than $91,000 a year in wages and benefits.

In 2008, Amtrak signed labor agreements with 13 unions that awarded pay increases retroactive from 2002 through 2008. It’s hard to square such pay increases in a company that operates in the red and can’t fund needed maintenance. An Amtrak inspector general report found that even prior to the 2008 pay increases, “the average annual cost of an Amtrak infrastructure worker is 2.3 times that of the average European railroad infrastructure worker.” The GAO has found that expensive retiree benefits and protections under the federal injury compensation system raise Amtrak’s costs compared to non-railroad industries.

Meanwhile, Downsizing Government also reports that service isn’t particularly good either:

For the overall system, Amtrak’s on-time performance has hovered below 70 percent in recent years. For long-distance routes, the on-time record falls to an abysmal 42 percent.

The Department of Transportation’s inspector general found that only 4 of 13 long-distance routes regularly achieved an on-time performance of at least 60 percent in recent years. Two lines, the Sunset Limited and the Coast Starlight were hardly ever on time. When long-distance trains were late, 75 percent were more than an hour late, and 25 percent were more than three hours late.

Airlines average about 80% on-time arrival.

There is little doubt that the Obama Administration’s rail boondoggle would quickly turn into Amtrak writ even larger, with delays, poor performance, perpetual subsidies, and a much larger unionized workforce funneling money into the coffers of the Democratic party.  The Republican’s in Congress should stand firm and prevent Obama’s flight of fancy from taking off.

Published in: on February 8, 2011 at 3:37 pm  Leave a Comment  

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