This Is Why Amtrak Should Get More of Your Money?

An Amtrak locomotive caught fire yesterday on its way from Chicago to Milwaukee. Fortunately, all 51 passengers were safely evacuated from the six-car train.

At about the time the locomotive was burning, a reporter was telling me that “everyone” in Washington was saying that the Philadelphia accident proves that Amtrak needs more money. No doubt the Wisconsin incident will add to those calls for more funding.

But go back and read the first paragraph: There were only 51 passengers on that train. All of them could have fit on one motorcoach, many of which have 52 or more seats. The Horizon coaches used on this train typically have 60 seats, which means the train was less than one-sixth full. According to Amtrak’s performance report for fiscal year 2014, the Chicago-Milwaukee Hiawatha trains filled an average of 36 percent of their seats in 2014, or about two-and-one-half buses worth.

Amtrak fares for its seven daily trains each way between Chicago and Milwaukee start at $24. According to Busbud, Greyhound and Megabus together offer 13 trips per day each way between Chicago and Milwaukee, and their fares are often as low as $7 and never higher than $10.

While intercity bus operators pay a discounted fuel tax, the buses otherwise operate without subsidy. Amtrak’s Hiawatha trains produced $16.8 million in ticket revenues in 2014 against $24.5 million in operating costs, for a net loss of $5.7 million (not counting amortized capital costs). The trains carried slightly less than 800,000 riders, for an average subsidy of slightly more than $7 per trip.

In other words, the subsidy alone would have been enough to give every single Hiawatha rider a free trip on Greyhound or Megabus (at the low cost of $7 per trip).

Rail proponents say we need to have trains because some people prefer trains over buses. Apparently, there aren’t very many such people, or the Hiawathas would fill more seats. But there are a few people willing to pay $24 for a trip that would only cost them $7 to $10 on a bus. I suspect most of them bill the fare to their employers.

If Amtrak were to disappear tomorrow, I’m sure Greyhound, Megabus, and other bus companies would be glad to take up the slack. For those who are too snobbish to take an ordinary bus, someone like Limoliner or Vamoose Gold would be happy to charge them two or three times ordinary bus fares to get a luxury ride with wider seats, more legroom, on-board food services, and other amenities.

Until that happens, now you know why you’re supposed to be happy that your tax dollars are going to subsidize Amtrak: so a few snobs who won’t ride ordinary buses can get subsidies to ride expensive and mostly empty trains.