Railway Age passenger train opinion (Now Passenger Train Journal?)

[prokowave]

prokowave: if the US Government had redirected all of that money away from the NEC, who would have funded the renovations the NEC so badly needed? The states definitely wouldn’t have covered enough.

My argument is that with with sufficient investment across the country, bringing faster more reliable service to all corners, Amtrak could have made a better case for a larger total capital allotment which would also cover the NEC's needs. It would also get the LDs to a point of profitability so that NEC operating profits could be directed towards NEC improvements rather than subsidizing LD operations. By that time Amtrak could have been financing most of its own improvements instead of having things dragged out for years every time the political winds change.

The fact is, at this point most of the US hasn't experienced good rail service and until they do, it's harder to get them to support it politically. The average Joe doesn't realize it's NS delaying trains, they just think it's Amtrak and bureaucratic incompetence. Build new tracks to run the trains faster and on time through places like Alabama and maybe you can get more money for the whole system.

[rcthompson04]

At some point, something entirely new should be built. When Interstate Highways were built to replace US routes, they built brand new expressways in a brand new right-of-way. They did not try to make the existing highways better in their own right-of-ways.

That is factually incorrect. Good portions of the Interstate system use pre-Interstate controlled access highways especially in the Northeast. In the west, most of the Interstate system was just built on top of the existing US highway network with some breaks.

[mtuandrew]

My argument is that with with sufficient investment across the country, bringing faster more reliable service to all corners, Amtrak could have made a better case for a larger total capital allotment which would also cover the NEC's needs. It would also get the LDs to a point of profitability so that NEC operating profits could be directed towards NEC improvements rather than subsidizing LD operations. By that time Amtrak could have been financing most of its own improvements instead of having things dragged out for years every time the political winds change.

Yes, if Amtrak had started with more political support it would have gotten more money, and with that money it could have done more things to ensure a true national passenger network. It didn’t start under that premise though - at its outset, Amtrak had a limited vision. At best it was a way to relieve a burden on private railroads, at worst it was a way to kill passenger trains. Only a small number of people were pushing for a modern American high-speed rail system at that point, and then only between Washington, New York and Boston using legacy rail infrastructure.

I don’t see how splitting Amtrak into two entities would accomplish the goal of increasing investment in American passenger railroads.

[Gilbert B Norman]

I have noted this at other topics, but I believe it bears relevance to Mr. Stephens immediate.

During early 1972, the myth that Amtrak wouldn't need Federal funding was exposed for what it was, so it's now time to start the "trek" from L'Enfant to The Hill to testify in front of one House Subcommittee or the other. At such, a Member pointed the question to then-CEO Roger Lewis, "Sir, if we were to give you a Billion dollars (remember, it's '72), what kind of railroad could you give the American people?".

Mr. Lewis responded; "Congressman, that is simply more funds than we could sensibly commit".

You don't say that on The Hill, if unbelievable, dig up Congressional Records from that era.

[mmi16]

The premise of this article is tiresome to me. Yes, we know Amtrak is attempting to increase efficiencies on the Northeast Corridor. Yes, we know they have moved away from traditional amenities like a staffed from-scratch dining car. Yes, we know that the long distance lines aren’t making money and likely will never make money. Yes, we know that there is a vocal group of traditionalists (including Spotswood and Selden) who won’t be entirely happy until there is a matched E9 A-B-A set leading a twenty-car all-Heritage consist on every train west of the Appalachians and south of the Potomac, and a GG1 leading every train northeast of those.

Amtrak is the National Rail Passenger Corporation, an entity primarily owned and fully managed by the US Federal Government. It has tried mightily to build out a national system that begins to fill the shadow of the passenger train network of sixty-five years ago, and has exceeded it in locations like the NEC and California. While it does benefit from having regional and business operating units (LD, state-supported, NEC, commuter operations), it’s safe to say that no one would benefit from a Balkanized system except the inevitable private operators. What would be a major benefit is proper funding, more beneficial agreements with host railroads (both carrot and stick), different labor agreements (again, beneficial for both parties when possible), and for Pete’s sake, its own line into Chicago from the East.

Ok, off my soapbox.

Just what you said National Rail Passenger Corporation - that does not mean NEC only!

[Triaxle]

Railway Age, the magazine industry ostensibly read by executive and managers, has become a soapbox for enhanced passenger trains - nationwide.

The linked material appears to be an opinion piece, even if it does not meet my personal standards for being labeled as such. But be that as it may, I'm at a loss how this continual "party line" of non-GAAP accounting abounds. Sites and publications from the advocacy community, who even go beyond "non-GAAP" (which flies in the face of what a Global accounting firm reports) with terms such as "fraudulent" are I guess what their constituents want to see in print or on screen, but RA? come on.

https://www.railwayage.com/passenger/in ... k-concept/

Fair Use:

When times are fiscally tough, Amtrak’s long-distance trains provide its current management was a convenient scapegoat on which to blame deficits. It’s a task facilitated by Amtrak’s dysfunctional, opaque, non-GAAP train accounting system, and a political agenda that places the Northeast Corridor as Priority One. A correct accounting that includes capital and fairly distributes overhead (management) costs will demonstrate that the Northeast Corridor isn’t a money-maker as Amtrak claims, and requires substantial federal dollars, making it an overall financial drain. Of course, that deals with the inconvenient truth that some of those states’ commuter lines use the Northeast Corridor far more frequently than does Amtrak’s intercity trains, with generous subsidies from federal taxpayers.

The reason I chose to have this a topic of its own is that points away from "non-GAAP" accounting are addressed.

Other issues; first the author cites a need for additional frequencies over the "Trains America" system, as it would enable the "overhead" to be allocated over "two a day" instead of one. Well great, but where will the additionsl capacity come from? The existing Class I system? Don't think so, unless the Feddytrough is prepared to.be filled with feed.

Further, the Superliner fleet, especially the 40yo I's are at the end of their service life and will need to be replaced. But all told, equipment replacement as well as additional track cspacity - needed as the roads adapt Precision Railroading concepts, will make the LD's hopeless losers.

It's time to start accepting the facts of life; the only possible reason to maintain a mode of transport thst has been dead since 1966 (an airline strike provided a short lived "pop") is some kind of political interference. Amtrak management knows whacking the LD's will not happen overnight, so for those that hang on, they should be re-equipped with cars that are readily convertible to short distance configurations, i.e. single level cars compatible with those on order for the Corridors - no Diners, no Sightseers.

There are a few times when the forum needs a "Like" button, and this in one. Trains are charming, have less hassle than TSA/Cattle class, and allow you see the land you are traveling through. Passenger trains are also a 19th century travel mode. It's now the 21st century. If we're going to have long distance passenger train service it needs to be a niche operation for enthusiasts, probably on higher service/higher fare model and run with low overhead. If that's not possible, well then we just can't have it.
You can't always have what you want.

[David Benton]

Well , reading Mr "soon to retire" Frailey's blog in trains , UP and others are facing quite a downturn. Many think it may find it irreversible , unless things change. It seems the move towards non rail served distribution centers, and their preference for smaller more frequent shipments, is favoring road over Intermodal.
http://cs.trains.com/trn/b/fred-frailey ... to-up.aspx

Could it be Railway Age is printing such opinions because it thinks the freight raiilroads may be more favorable to some Amtrak long distance investment, for speed and frequency improvements?. With PTC and PSR , perhaps they see some future there.

Incidentally, interesting they chose Railway Age rather than Railroad Age.

[Gilbert B Norman]

Mr. Benton, I fear there is merit to your thought.

Those who follow and report on industry affairs, such as Mr. Frailey, evidently sense this to be the case. The industry could become the "carrier of last resort" such as it was "during my day" of being on the payroll ('70-'81).

This time, one "captive commodity" - coal - will be "Missing in Action". Oil carriage could well be a "stopgap", until the necessary pipelines to handle North American production are built.

Now so far as traffic for which the industry must "compete", I hear you on that point, Mr. Benton. On one hand, the shippers want transportation that responds to their needs, which of course means highway. But on the other, anytime I see a BNSF train of double stacked containers pass my house (with winter coming, I'll again have a "pretty good" view from my front yard), I think "what if this business is lost, how will it move to market?". Where's the highway capacity? Where are the qualified Drivers? Will we end up with someone on "Fent" being behind the wheel of a 40 ton battering ram?

But I think of "Precision Railroading", and to me it simply is telling shippers "this is how YOU will do things" as in "You're in the Army now". It could easily represent a return of the "unreported liquidation" JGK lamented about on the pages of TRAINS forty years ago. Railroad shares appear to be driven by the "rich" dividends they pay and the stock repurchases of late as Free Cash Flow is used to pay or buy them rather than being reinvested in the property to handle more traffic efficiently.

So all told, Mr. Benton, I do not rule out your thought that the industry could be looking to drum up passenger train business.

disclaimer: author holds Long position UNP in a traditional brokerage account

[John_Perkowski]

First off,

No matter what we think of it, the President’s actions on overseas trade directly influence carloadings, both at the ports and in the midsection. That is reducing the bulk and the container cargoes in both directions.

Second,

The energy industry is slowly but inexorably moving to renewables. That will also impact carloadings over time.

But third,

Windmill props are by their very size rail transported.

Fourth,

Does anyone out there see any Democrat being elected demanding a significant ( >20%) surcharge per seat mile for commercial aviation (scheduled, charter, or corporate owned) as a pollution disincentive to travel? I cannot even see this from Warren and Sanders, and they need the money to underwrite Medicare for all...

So,

What I see are carloadings being impacted by the business cycle, nothing more or less. I don’t see line haul passenger rail providing a demand for time on the line any time soon. As long as goods arrive at Los Angeles, New York, and Houston, they have to get to Spokane, Billings, Denver Chicago and Kansas City somehow. The economical way is freight rail.

Disclaimer... Long IRA UNP position.

[JoeG]

I'd like to add a point to Mr Benton's last post. Back in the day, railroads were expected to eat passenger losses in return for their being able to profit from freight. This proposition has expired along with the advent of deregulation. So, these days, any state or locality that wants to start or increase passenger service will expect to pay a class I for the track usage. So, passenger service may end up being even more profitable in the future.

Col Perkowski believes that current traffic downturns are just due to business cycle declines. He is undoubtedly right in part, and of course our trade war with China doesn't help.

But the Class I's, with the exception of BNSF, have all decided that they want high margin freight, and will not compete for lower margin but still profitable freight. I am assuming the reason for this is the preoccupation of Wall St and hence railroad management with the operating ratio statistic. After all, if they can run fewer trains for only high-margin freight, their operating ratio will improve. Also, I don't know that I understand all of PSR but it looks like what it means is that railroads will run fewer trains to suit their operational convenience, rather than providing good service.
The policy of discouraging all but high-margin freight is bound to be self-defeating. This freight is most susceptible to being switched to truck to get better service. Also, it seems to me that a better approach than cherry-picking customers is to increase the efficiency of low-margin freight.

In particular, intermodal is described as low margin. The average length of truck haul is around 500 miles. The only railroad that seems to be looking for this medium-length traffic is FEC.
In the past, efforts to run fast trains to compete with trucks have failed. (I'm thinking specifically of the Santa Fe's attempt in the 1970s to run a freight each day on the Super Chief's time.) This attempt failed for 2 reasons: 1) running trains that fast could be done but it disrupted the rest of the railroad, and 2) Shippers wouldn't pay extra for the fast service.

Intermodal has become more efficient since then, and PTC provides at least the potential to improve flexibility and traffic capacity. Also, roads have become more congested and dilapidated, and there is a chronic truck driver shortage. So, it looks like a good time to try to make intermodal more profitable, instead of not competing for sub-500 mile traffic.

[eolesen]

To John's points on container traffic... don't forget Panamax container operations have been increasing along the East Coast, which I'd have to imagine has put some of a dent into traffic at the west coast ports.

[mtuandrew]

Moderator Note: keep in mind that this is about passenger rail, specifically the proposal(s) to split Amtrak and separately manage the long-distance services. Class 1 precision scheduled railroading & freight service is of course relevant, but keep it related to passenger rail.

[John_Perkowski]

If we assume Amtrak line haul gets separated from Amtrak short haul, I think we can plan to put out the Adios drumheads. 1 a day for about 10 trains does not put a rounding error on the passenger miles of this nation.

[djlong]

I think you're likely to see fuel taxes for infrastructure improvements with a "Blue Wave" in 2020.

You don't need fuel taxes for "Medicare For All". At the risk of going off-topic, you can pay for MfA with the existing premiums being paid out to private insurance companies with a LOT of money left over - and the public will swallow that since it's comparing like-to-like, not apples-to-oranges.

With those increased fuel taxes, one can easily imagine rail and other mass transit projects getting a bigger voice at the table for more funding.