By Noel T. Braymer
Yet again Amtrak is claiming they lose money running long distance trains. What Amtrak really wants to do is to try to make money carrying more people on regional corridor services between major cities. So lets look at one if not the best performing Amtrak regional train service: the Pacific Surfliners. The Surfliners evolved out of the ATSF San Diegan trains that ran between San Diego and Los Angeles. When Amtrak took over the San Diegans they first ran 2 and then 3 round trips from 1971 up to the mid 1970’s. With the State of California’s financial support starting in the mid-1970’s came the introductions of the then new Amfleet cars and F-40 locomotives. After increasing the service from 3 to 7 round trips, ridership more than tripled going from just over 300,000 riders annually with 3 daily trains to over a million annual riders by 1980 with 7 round trips. I remember my first train trip on Amtrak was after I and a friend from work rode our bicycles on a Saturday in September along the Coast from Los Angeles to San Diego. Of course neither of us wanted to ride home to Los Angeles the next day on our bikes. When I found out that we could ride the train home and put our bikes in the baggage car, our problems getting home were solved.
What I remember before catching the train were all the stories I’d heard in the media of Amtrak running “empty” trains that wasted a great deal of money traveling across America. I was looking forward to a train trip in the late afternoon with plenty of empty seats. Instead the train left San Diego with standing room only. After that it got more crowded. I only could find a few empty seats on the train before leaving San Diego which were in the smoking car which they still had in 1978. A major reason this train was standing room only was not only because it was leaving late in the afternoon. But it was also because it was a connecting train to the then Southwest Limited from Los Angeles to Chicago. That’s why my train had a baggage car while most San Diegan trains didn’t. What I did see was a great deal of potential for carrying more people by train and that people would ride them if decent rail service was available.
At the time of my first Amtrak train trip in 1978 a sixth round trip had been established between Los Angeles and San Diego. By October of 1980 a 7th round trip between San Diego and Los Angeles had been added. During this time senior Amtrak executives tried to establish a Japanese based private company “Bullet Train” service between Los Angeles and San Diego which ended up going nowhere. Building such a project in an urban area would be very expensive and there was major opposition from local neighborhoods. By October of 1987 an eighth San Diegan was running between San Diego and Los Angeles. A major project for the San Diegans at this time was the effort by the State of California to extend some of the San Diegans north of Los Angeles to Santa Barbara. This would require the cooperation of the Southern Pacific Railroad. This was the last thing the Southern Pacific wanted to do and the State filed a lawsuit to force the SP into extending passenger service to Santa Barbara. It took until June 26, 1988 before the first San Diegan train ran to Santa Barbara after California won its lawsuit.
What were the results of extending just one out of 8 trains for the San Diegans to Santa Barbara? Back in the 1980 Fiscal Year the San Diegans carried just over 1.2 million annual riders with revenues of $3.34 million which covered just over 60% of its costs according to Amtrak at that time. By Fiscal Year 1986 ridership was almost 1.4 million riders with revenues of $5.7 million which covered 88% of its costs according to Amtrak. By Fiscal Year 1988 ridership was at roughly 1.66 million riders with revenues of $8.2 million with a cost recovery of 104%. This was happening during the time (1982-1993) W. Graham Claytor was Amtrak’s President. He made dramatic reductions in Amtrak’s deficit by expanding Long Distance Train service which brought in more revenue than the cost needed to expand service. Also by extending the San Diegans to Santa Barbara with just one round trip brought in a major jump in revenues for the San Diegans. In Fiscal Year 1989 ridership on the San Diegans went up to 1.7 million riders with revenues of $ 11.5 million and a Farebox Recovery of just over 108%. Much of this jump in revenue was because of just this one San Diegan train: passengers were riding longer average distances and paying more to ride. People were not just traveling between Los Angeles and Santa Barbara. Many people were riding from Orange and San Diego Counties past Los Angeles Counties to and from Ventura and Santa Barbara Counties. Around the same time improved bus connections were made with the other San Diegan trains for travel north of Los Angeles to Santa Barbara and even to San Luis Obispo and San Francisco.
Then things changed. In Fiscal Year 1994 with San Diegan ridership at roughly 1.7 million riders and $13 million in revenue the San Diegans recovered about 91% of its costs from fares. By Fiscal Year 1997 with roughly 1.6 million passengers and about $15 million in revenue the San Diegans were now recovering only 37% of its “costs” from the farebox according to Amtrak. So what happened? W. Graham Claytor retired as President of Amtrak in 1993 roughly a year before he died. The next 2 Amtrak Presidents bet the farm on the new Acela trains which would replace the Metroliners and provide direct “High Speed Rail” service on the Northeast Corridor from Washington and New York past New Haven to Boston. So far so good. However the cost of the project soon went over budget in large part because of cost overruns for the construction of the new Acela equipment. It would have been cheaper to buy equipment from existing production overseas. But these wouldn’t meet the crash worthiness standards set by the Federal Railroad Administration. Since then the FRA has found that High Speed Rail Trainsets built overseas are not only lighter than equipment built in this Country. But there are safer for passengers in a crash than the equipment built in this country meeting FRA crash worthiness standards.
In an attempt to “save money” Amtrak management in the late 1990’s cut back many of the new and improved long distance services created under Claytor and eliminated the Desert Wind train between Los Angeles to a connection to the California Zephyr at Salt Lake City. They also cut at the same time the Pioneer train which also connected with the California Zephyr at Salt Lake City from Seattle. These cutbacks in service did little to save money since much of the cost problems at Amtrak are its fixed costs. The results of such cuts were a major reduction in revenues with little savings in costs. This all came to a head by 2002 when the George W. Bush Administration had to spend billions of dollars bailing out Amtrak.
Amtrak lost money after the retirement of W. Graham Claytor due to its cutbacks of revenue services. With that Amtrak charged more of its costs to the State supported trains like the Pacific Surfliners. This resulted in much lower cost recoveries from the farebox. During Fiscal Year 2001 the now Pacific Surfliners posted cost recoveries just over 50%. For the Fiscal Year 2015 the Surfliners reported about 2.8 million riders with $76 million in revenues with just over 70% of fare box recovery. By Fiscal Year 2017 ridership almost hit 3 million with roughly $83 million in revenue and a farebox recovery of 79.2%. So what jumped up the farebox recovery? By Fiscal Year 2016-17 LOSSAN, the Joint Powers Authority which oversees management of the Surfliners worked out a deal with local Amtrak Managers in Los Angeles. The result was a 12th round trip between San Diego and Los Angeles. There had been no additional service between San Diego and Los Angeles since 1998 when the 11th train was introduced. But not only that. This new train also created a 6th roundtrip train from San Diego to Santa Barbara and a 3rd to San Luis Obispo. But the best part of this plan was it could be done with available equipment.
How this worked was a trainset which usually would have left Los Angeles in the morning, instead left Los Angeles late at night after being serviced at the 8th Street Yard. It ran in revenue service giving a 12th train southbound to San Diego. This train got a new crew and a short turnaround leaving San Diego a little after 4 AM for an early morning arrival into Los Angeles for people needing an early start on the business day. From there the train continued to San Luis Obispo and followed the same equipment rotation of the 2 other San Diego/San Luis Obispo trains. The result was a jump in fare box revenues with few extra costs since they were getting greater productivity using equipment which otherwise wouldn’t be in revenue service. This is at the heart of increasing income. Trains don’t earn revenue sitting idle. Commuter trains often carry large numbers of people during rush hours. But they often sit idle most the day and night and on weekends. Commuter train often lose money because their ridership is mostly for low fare short distances and equipment utilization is poor. This is why in most countries today run commuter services as run through services through the center of a metro area to and from opposite ends as well as run them all day long 7 days a week. Fires, rain storms and mud slides shut down much of Highway 101 in Ventura and Santa Barbara Counties in late 2017 and early 2018, LOSSAN cut back the 12th round trip train out of San Diego to Los Angeles. This reduced the Farebox recovery for the Surfliners. LOSSAN decided that given the transportation emergency north of Los Angeles, creating a long planned local rail passenger service between Ventura County and Santa Barbara County was needed after Highway 101 was cut off. The railroad was back in service before the highway. LOSSAN now is planning to add a 13th San Diego to Los Angeles Surfliner by the end of 2020 which will restore a 6th round trip from San Diego to Santa Barbara and 3rd round trip to San Luis Obispo.
The reason the Pacific Surfliners preform so well is it works more like a Long Distance Train, not as an express corridor service. Long travel distances and access to more stations means more market combinations and more passenger miles. That’s what is needed to improve a passenger train’s productivity. If we look at the NEC, many Amtrak trains there have plenty of empty seats for much of their run. A good example of how to maximize rail service is Switzerland. They have some of the highest rail passenger usage per capita in the world. How they do this is the rail passenger services connects with everything. Most small towns with a train station in Switzerland have trains running every half hour at the same time of the hour. These trains connect to other stations with local transit services. This also connects to major cities with connections to airports. There are also rail connections at the central city train stations to international rail passenger service to all of Europe. Much of this is High Speed Rail service. My point is the most productive use of rail service is part of a network of local services, regional services and long distance services all working together. The history of Amtrak shows that service cutbacks don’t save money. Instead reduced rail service means less income because fewer trains are in revenue service.
This is from the current LOSSAN JPA Business Plan showing the financial performance of the Pacific Surfliner according to Amtrak over the years. To the left is the fiscal year, then the ridership, the revenue and lastly the farebox recovery. What is striking is how the percentage of Farebox recovery jumps around. .