Friday, October 19, 2012

Why Amtrak Keeps Breaking Ridership Records and Will Continue To Do So

Why Amtrak Keeps Breaking Ridership Records and Will Continue To Do So

"Last week, Amtrak announced its highest annual ridership … ever. America's passenger rail provider carried 31.2 million people in fiscal 2012, which ended with September. That's a 3.5 percent increase over 2011 and led to ticket revenues of roughly $2 billion. Since the year 2000, ridership is now up 49 percent.

Amtrak's broken ridership records are beginning to sound like a broken record. As the above chart shows, the 2012 mark was the ninth annual record in ten years. September's numbers marked a twelfth consecutive monthly record. July of 2012 was the single best month in Amtrak's 41-year history."

"What's most impressive about Amtrak's recent success is that it's not attributable to any one clear factor but rather speaks to a general attraction toward train travel. Amtrak itself points to improved services like WiFi and electronic ticketing, as well as high gas prices. In the Northeast Corridor the shift reflects sustained discontent with air travel; as the New York Times recently reported, Amtrak now captures 75 percent of the intercity market between New York and Washington, and 54 percent between New York and Boston. A growing perception of the train as a "mobile office" surely contributes as well."

"Amtrak is now a (relative) success at the ticket window. Revenue in 2012 covered 85 percent of Amtrak's operating expenses [PDF]. As a consequence of this improved financial footing, Amtrak requested only $450 million in federal operating funding in 2013 — less than Congress was willing to appropriate."

"A far more productive conversation about Amtrak's subsidies requires a look at individual services. Those only exist as prospective 2012 figures for the moment [PDF, via Transportation Nation], but they're instructive nonetheless. In the Northeast, Amtrak makes about $20 per rider, and among the individual state routes, it loses a little less than $11 per rider. That works out close to a wash. The real drain on taxpayers is Amtrak's long-distance routes. Ridership may be up 4.7 percent on those services for the year, but the projected loss comes out to more than $111 per rider. If there's a substantive discussion to be had about the future of Amtrak, it's about the viability of these long-distance services, which unlike many local transit routes that lose money don't seem particularly necessary as a public service."

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