Losses Lowest Since 1975

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Amtrak had a good year financially in FY2012 comparatively speaking. The FY2012 appropriations provided $466 million in operating subsidy, so with a $361 million actual loss, that left Amtrak with $105 million available to spend on projects in addition to the annual capital and debt grants.

Related to the press conference, Amtrak put out a news release titled "Amtrak 2013: New Year Brings Major Projects" summarizing the equipment acquisition and track projects for the NEC or those that Amtrak is the lead on. The funded projects in CA, Cascades corridor, Chi-StL, IL, MO, NC, central MA, VA, the order of 130 corridor bi-levels are not listed, but are underway.
 
FOR IMMEDIATE RELEASE January 10, 2013ATK-13-008 Contact: Media Relations 202 906.3860

AMTRAK 2013: NEW YEAR BRINGS MAJOR PROJECTS Infrastructure upgrades, new equipment milestones and high-speed rail advancements lead full agenda

WASHINGTON – Amtrak enters 2013 with a full and robust agenda of infrastructure upgrade projects, significant milestones for new equipment orders and key actions to advance its Northeast Corridor (NEC) high-speed rail program. Among the projects include completion of the NEC Niantic River Movable Bridge replacement project, delivery of the first units of new equipment orders for 70 electric locomotives and 130 single-level long-distance passenger cars, expansion of Acela Express high- speed service with an additional New York – Washington round-trip and initiation of the process to acquire next-generation high-speed train sets. “Amtrak continues to advance and invest in projects that provide both near-term benefits and long-term improvements for the effective delivery and reliability of intercity passenger rail service,” said President and CEO Joe Boardman. During the coming year, three Amtrak-owned or maintained corridors will be under various stages of construction to enhance and ultimately increase rail capacity including the Springfield Line in Conn., the Hudson Line in upstate N.Y. and a section of the NEC in N.J. In addition, Amtrak anticipates reaching agreement in 2013 with the Michigan Department of Transportation to operate, dispatch and maintain a section of state-owned railroad from Kalamazoo to Dearborn that will lead to track improvements to support 110 mph service. Other projects in 2013 include: advancing planning work for the Gateway Program to increase tunnel, track and station capacity into Manhattan for intercity, commuter and next- generation high-speed rail service; improving accessibility at stations under requirements of the Americans with Disabilities Act; completing installation of Positive Train Control safety technology along the NEC and Keystone Corridor; and upgrading the AmtrakConnect Wi-Fi service to 4G/LTE.

Boardman explained these and other projects support a strong focus on strengthening the Amtrak bottom line and its strategic goals of safety and security, customer focus, mobility and connectivity, environment and energy, and financial and organizational excellence. He said the 2013 agenda builds on the successes from 2012 which saw record ridership, the best-ever system-wide on-time performance, the national launch of eTicketing and the start of new Northeast Regional service to Norfolk, Va., the extension of Downeaster service to Freeport and Brunswick, Maine, and the beginning of 110 mph operations on the Lincoln Service in Illinois and on the Wolverine and Blue Water services in Michigan. Attached are highlights of just some of the major projects Amtrak will begin, continue or complete during 2013 across its national network.

About Amtrak® Amtrak is America’s Railroad®, the nation’s intercity passenger rail service and its high-speed rail operator. A record 31.2 million passengers traveled on Amtrak in FY 2012 on more than 300 daily trains – at speeds up to 150 mph (241 kph) – that connect 46 states, the District of Columbia and three Canadian Provinces. Amtrak operates intercity trains in partnership with 15 states and contracts with 13 commuter rail agencies to provide a variety of services. Enjoy the journey® at Amtrak.com or call 800-USA-RAIL for schedules, fares and more information. Join us on facebook.com/Amtrak and follow us at twitter.com/Amtrak. # attachment #

Amtrak Major Projects

ADVANCING GATEWAY PROGRAM In 2013, Amtrak intends to continue planning and other pre-construction activities on its Gateway Program to provide additional capacity into Manhattan for Amtrak intercity and New Jersey Transit commuter services, including the proposed next-generation high-speed rail system. The project includes building two additional tunnels under the Hudson River to access expanded terminal facilities serving New York Penn Station and the future Moynihan Station. It also will replace and expand the century old Portal Bridge over the Hackensack River and increase from two to four the number of tracks between Newark and New York. Amtrak is also seeking funding this year to specifically advance design and early construction elements of the Gateway Program to preserve a pathway for the two new Hudson River tunnels to New York Penn Station.

NEXT-GENERATION HIGH-SPEED RAIL TRAIN SETS Amtrak plans to further expand its high-speed rail service and recently announced its intention to begin in early 2013 the process to purchase next-generation high-speed rail train sets that will expand seating capacity and provide for more frequent high-speed service on the NEC. In considering options for this equipment, Amtrak will be assessing how high-speed equipment technology has evolved since present Acela equipment was built, how modern equipment can provide an equivalent or better level of safety while also meeting business needs, and opportunities to use this equipment acquisition to serve as a catalyst to encourage expanded domestic manufacturing of high value modern technology.

NEW ACELA EXPRESS NEW YORK-WASHINGTON ROUND-TRIP Amtrak is expanding its Northeast Corridor high-speed rail service with the addition of a new weekday Acela Express round-trip between New York and Washington beginning on Jan. 28. The late evening departures from both cities will provide customers increased flexibility when making their travel plans. The new Acela service includes an 8:00 pm northbound departure from Washington Union Station (Train #2128), arriving at New York Penn Station at 10:45 pm, and a 9:15 pm southbound departure from New York (Train #2175), arriving in Washington at 11:59 pm. Both trains also will serve Baltimore, Wilmington, Philadelphia, and Newark.

160 MPH HIGH-SPEED RAIL UPGRADES IN NEW JERSEY In 2013, Amtrak will further advance design, engineering and other pre-construction activities for a $450 million project funded by the federal high-speed rail program that will boost top train speeds from 135 mph to 160 mph along a 24-mile section of the NEC between Trenton and New Brunswick, New Jersey. The project supports the goals of the Gateway Program and includes upgrading track, electrical power (frequency converter capacity and additional substations), signal systems and overhead catenary wires to permit the faster speeds and also reconfigures track switches at the western entrance to New York Penn Station to mitigate congestion issues. The full project is to be completed in 2017.

70 NEW ELECTRIC LOCOMOTIVES The first unit of a $466 million order for 70 new electric locomotives will be delivered during 2013. The new equipment will operate at speeds up to 125 mph on the NEC (Washington – Boston) and up to 110 mph on the Keystone Corridor (Philadelphia – Harrisburg) replacing locomotives in service between 20 and 30 years with average mileage of more than 3.5 million miles traveled. They will be easier to maintain and more energy efficient using regenerative braking to feed energy back into the power grid. They are being built by Siemens at a facility in Sacramento, Calif.

130 NEW SINGLE-LEVEL LONG-DISTANCE CARS The design and build out for the $298.1 million order for 130 new single-level long-distance cars, including sleepers (25), diners (25), baggage cars (55) and baggage/dormitory cars (25) continues to progress. The delivery of the first four of the eight test pilot cars are due late in 2013 with the first units expected to be placed into service late spring 2014. They will replace and supplement the existing fleet, improve financial and on-time performance, and allow Amtrak to retire the oldest cars still in service that date back to the 1940s. They are being built by CAF USA at a facility in Elmira, N.Y.

UPDATED FLEET STRATEGY PLAN Amtrak intends to release an updated fleet strategy plan in 2013 with the latest analysis on replacing and expanding its existing conventional and high-speed rail fleet. It is being written to better align with the Amtrak Strategic Plan with a focus on the needs of the new business lines to improve their financial bottom line, provide superior customer service and best serve the market potential of their areas of responsibility and then use this as the basis for allocating capital resources available for equipment.

NIANTIC RIVER MOVABLE BRIDGE REPLACEMENT In May 2013, Amtrak expects to complete construction on this $140 million multi-year project to replace the Niantic River Movable Bridge originally built in 1907 and located between East Lyme and Waterford, Conn. Partially funded by the American Recovery and Reinvestment Act, the new bridge is now in operation and will enable Amtrak to increase speeds and minimize traffic and delays. The project involves constructing a new two- track, electrified railroad bascule bridge just south of its present position, new track alignments on both approaches to the bridge and expansion of the navigation channel beneath the bridge and an increase in the vertical under-clearance above the water for the benefit of river traffic. Also, sections of the Niantic Bay Overlook boardwalk will be reconstructed and the public beach replenished.

SPRINGFIELD LINE IMPROVEMENTS In 2013, Amtrak will continue the installation of underground signal and communication cables over the 60 mile Springfield Line, the first portion of construction for the State of Connecticut-led New Haven-Hartford-Springfield (NHHS) Rail Program to expand passenger rail service. This work is required to upgrade signal and communication systems for the NHHS program and prepare for subsequent infrastructure improvements to add a second track.

HUDSON LINE IMPROVEMENTS In Dec. 2012, Amtrak executed a long-term lease agreement with CSX Corporation, enabling Amtrak to take full control of the Hudson Line between Schenectady and Poughkeepsie, N.Y. The arrangement ensures that passenger rail service has scheduling priority there and paves the way for four significant rail improvement projects led by the State of New York totaling $181 million. Amtrak intends to begin work on these projects in 2013.

AGREEMENT WITH MICHIGAN ON KALAMAZOO – DEARBORN LINE Amtrak anticipates signing an agreement in 2013 with the Michigan Department of Transportation to operate, dispatch and maintain a 135-mile section of state-owned railroad from Kalamazoo to Dearborn that will lead to track improvements to support 110 mph speeds for Wolverine and Blue Water service.

B&P TUNNEL REPLACEMENT Amtrak will begin preliminary engineering and NEPA environmental work in 2013 for replacement of the 1873 vintage B&P Tunnel in Baltimore. This phase of the multi-year project is funded by a $60 million federal high-speed rail grant to the State of Maryland. A new tunnel is envisioned to have an improved alignment to enable an increase in speed and capacity for Amtrak, MARC Commuter, and Norfolk Southern freight trains.

SUSQUEHANNA RIVER BRIDGE REPLACEMENT Amtrak will begin preliminary engineering and NEPA environmental work in 2013 for replacement of the 1906 vintage railroad bridge crossing the Susquehanna River between Perryville, and Havre de Grace, Maryland. This phase of the multi-year project is funded by a $22 million federal high-speed rail grant to the State of Maryland. A new bridge is envisioned to have additional tracks to increase speed and add capacity for Amtrak, MARC Commuter, and Norfolk Southern freight trains.

POSITIVE TRAIN CONTROL (PTC) In 2013, Amtrak intends to complete installation of PTC equipment along the Amtrak-owned right-of-way. Amtrak has completed installation on the section between Philadelphia and Washington. The section from New York to Philadelphia is more than 90 percent complete as is the section between Philadelphia and Harrisburg. PTC has been in operation between New York and Boston for years and the entirely of Amtrak-owned tracks on the Michigan Line (Porter, Ind. to Kalamazoo, Mich.) also has PTC in operation today.

ENHANCING SECURITY In 2013, the Amtrak Police Department (APD) will continue its comprehensive passenger rail safety and security efforts to provide increased protection to passengers, facilities, property and equipment and to detect and deter terrorists. APD also will continue its efforts to engage passengers and the public as part of its Partners for Amtrak Safety and Security program and “If you See Something, Say Something…Hopefully, its Nothing” public awareness campaign to encourage individuals to report behaviors or activities that are unusual or out of the ordinary such as trespassers and suspicious packages by calling Amtrak Police at 1- 800- 331-0008.

UPGRADING WI-FI TO 4G/LTE Since launching in 2010, AmtrakConnect Wi-Fi has been a highly-adopted passenger amenity. Built to use the cellular-based mobile network, this service supports as many as 30 to 50 percent of passengers on a single train. As cellular carriers expand their 4G/LTE footprint along Amtrak routes, so too has Amtrak begun to upgrade its Wi-Fi service to take advantage of the new increases in bandwidth, improved reliability, and increased speeds. Implementation has already begun on Acela Express and is currently undergoing stabilization and optimization activities. Amtrak will seek to expand 4G/LTE to other Wi-Fi trains and will continue to advance its Wi-Fi program as technology advances, continually striving to make the passenger experience better.

AUTO TRAIN PRIORITY OFF LOADING In 2013, Amtrak intends to begin a new service that would allow any Auto Train passenger to pay an extra $50 fee as part of a guarantee to have their vehicle as one of the first 20 vehicles offloaded. This will improve both customer satisfaction and financial performance of the route.
 
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Pretty good to see the ACS-64 coming along.
 
Impressive. I suspect the figure is in real terms, to be honest: Per statements made at the time, the operating losses from passenger rail were around $200 million in the late 60s. Amtrak got rid of a lot of trains (for example, west of Harrisburg) and didn't take on all operations everywhere. Still, in real terms I can easily believe that 1974 and 1975 were the best years Amtrak ever had (remember, they temporarily revived The Chief to complement the Super Chief because of demand)...afterwards, price pressures and whatnot made a mess of Amtrak's situation (as did deteriorating equipment and a lack of capital investment in many cases).
 
Impressive. I suspect the figure is in real terms, to be honest: Per statements made at the time, the operating losses from passenger rail were around $200 million in the late 60s. Amtrak got rid of a lot of trains (for example, west of Harrisburg) and didn't take on all operations everywhere. Still, in real terms I can easily believe that 1974 and 1975 were the best years Amtrak ever had (remember, they temporarily revived The Chief to complement the Super Chief because of demand)...afterwards, price pressures and whatnot made a mess of Amtrak's situation (as did deteriorating equipment and a lack of capital investment in many cases).
Does this report adjust for inflation?
 
Impressive. I suspect the figure is in real terms, to be honest: Per statements made at the time, the operating losses from passenger rail were around $200 million in the late 60s. Amtrak got rid of a lot of trains (for example, west of Harrisburg) and didn't take on all operations everywhere. Still, in real terms I can easily believe that 1974 and 1975 were the best years Amtrak ever had (remember, they temporarily revived The Chief to complement the Super Chief because of demand)...afterwards, price pressures and whatnot made a mess of Amtrak's situation (as did deteriorating equipment and a lack of capital investment in many cases).
Does this report adjust for inflation?
There does not seem to be an underlying report to look at. It's an MSNBC article citing a statement by Boardman, but no link to the original.
 
Does this report adjust for inflation?
The lowest losses since 1975 is based on a statement by Joe Boardman in a phone press conference with reporters. That is based on that the net cash operating loss in FY 2012 was $361 million which is a little more than the preliminary number in the September 2012 monthly report.

We don't know if Boardman was adjusting for inflation or not. I suspect he was because Amtrak total ticket revenue in 1975 was $253 million with 17.27 million passengers (source: Amtrak's 40th university book). I don't think Amtrak lost $361 million in 1975 dollars in that year. If someone has a copy of the Amtrak FY1975 final financial report, that would answer the question.
 
While trying to find the answer to the 'adjusted for inflation' question, I came across a couple of interesting tidbits:

First, from the American Enterprise Institute (Just from their name you can guess their feelings about Amtrak) is this article, which was published today(10/16/12). Enjoy the up-to-date file photo they use for Amtrak. (Hint: Is that a steam engine I see in the background? :eek:hboy: )

Secondly, I found, through the above article, this "Wage and Benefit Comparibilty Analysis of Amtrak's PEB Union Employees" from 12/7/07.
 
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According to this article, which is according to Mr. Boardman, Amtrak's operating losses for 2012 are at their lowest since 1975! Down 19% since last year.
I'm actually more than a little bit surprised that the losses were lower in 1974-1975. (If this is in real terms... if it's in nominal terms I can believe it, there's been quite a lot of inflation since 74-75.) Although '73 was the first oil crisis, apart from that the underlying positive trends for passenger rail are stronger now than they were then... and '79 was the second oil crisis but 1980-1981 didn't have better financials for Amtrak.

On another topic, that press release *finally* gives us an update on the Viewliner schedule: nothing expected to be in service until "late spring 2014". Sigh. Speed it up already. Viewliner roomette prices are going to be through the roof until they're in service, to the point where I've been postponing my train trip plans until after they arrive. The press release also makes the interesting statement that the first delivery will be "four of the eight test pilot cars". I'm guessing that means that Amtrak is getting one car in each configuration (otherwise, why four?), then a second car in each configuration after Amtrak reports to CAF on any problems, and then the bulk of the cars.
 
While trying to find the answer to the 'adjusted for inflation' question, I came across a couple of interesting tidbits:

First, from the American Enterprise Institute (Just from their name you can guess their feelings about Amtrak) is this article, which was published today(10/16/12). Enjoy the up-to-date file photo they use for Amtrak. (Hint: Is that a steam engine I see in the background? :eek:hboy: )

Secondly, I found, through the above article, this "Wage and Benefit Comparibilty Analysis of Amtrak's PEB Union Employees" from 12/7/07.
The inflation factor for the time from 1973 to 2012 is 23.
 
The inflation factor for the time from 1973 to 2012 is 23.
23 what? 23 times? No, that is way too large using the CPI. According to the Bureau of Labor Statistics CPI calculator, $100 is 1973 is equivalent to $518 in 2012 dollars for purchasing power.

But if Amtrak's operating loss was, for example, $361 million in 1975 that would be approximately equivalent to $1.54 billion today. The CPI is hardly a perfect adjustment for inflation, but it gets us in the ballpark. So if Amtrak had $253 million in ticket revenue in 1975, but a net operating loss of in the $350 million range, the total cost recovery percentage must have been much lower than today. However, in 1975 Amtrak was still working through the large variety of heritage equipment, facilities dumped on them and had not taken control of the NEC. A comparison to 1979 or later when the Amfleet Is had been delivered and Amtrak had ownership of the NEC would be a fairer comparison of where the company is at. But, lowest losses since 1975 makes for a good headline.
 
The inflation factor for the time from 1973 to 2012 is 23.
23 what? 23 times? No, that is way too large using the CPI. According to the Bureau of Labor Statistics CPI calculator, $100 is 1973 is equivalent to $518 in 2012 dollars for purchasing power.

But if Amtrak's operating loss was, for example, $361 million in 1975 that would be approximately equivalent to $1.54 billion today. The CPI is hardly a perfect adjustment for inflation, but it gets us in the ballpark. So if Amtrak had $253 million in ticket revenue in 1975, but a net operating loss of in the $350 million range, the total cost recovery percentage must have been much lower than today. However, in 1975 Amtrak was still working through the large variety of heritage equipment, facilities dumped on them and had not taken control of the NEC. A comparison to 1979 or later when the Amfleet Is had been delivered and Amtrak had ownership of the NEC would be a fairer comparison of where the company is at. But, lowest losses since 1975 makes for a good headline.
I remember reading on Wikipedia that "Within 7 years of being under Claytor's leadership, Amtrak was generating enough money to cover 72 percent of its $1.7 billion operating budget by 1989, up from 48 percent in 1981." Now, part of that was an alteration in train mixes (i.e. more corridors, less LD trains as a share of operations), part of it was cutting costs on the food service front, and part was likely equipment mix improvements.

The question, of course, is what was included in each picture...I'm sure I can generate different figures to show "best year since" stuff for several years by different metrics. It's quite possible that Amtrak's CR went to hell in a handbasket as the 70s went on due to bad management of equipment and so forth as well, but that the picture wasn't that bad in the first few years.

While I'm on the subject, something stinks to high heaven about that $361 million loss number. I've got the September MPR up in front of me, and it shows the following numbers:

(1) National Train System: $502.8 million

(2) Operating results: $1,218.8 million

(3) Operating results sans depreciation: $554.7 million

(4) National Train System plus Ancillary Customers: $336.9 million

Number 4 gets closest, but that number feels monkeyed with. I'll also note that this is the number at the bottom of page 48. If I instead consult page 5, I get $388.7 million in losses versus federal operating support of $345.3 million.

(Actually, this is irritating...I've now got way too many figures in that $300-400 million range for operating support, so where is the $361 million figure coming from, anyway? Due respect to Mr. Boardman, but something has to be wrong about one set of figures, and though I can believe that the preliminary numbers were just off by a bit, nearly $30 million is a surprisingly large error.)

And to echo a comment above, if anyone has the Amtrak annual reports from long ago, they will find an eager reader in me.
 
The inflation factor for the time from 1973 to 2012 is 23.
23 what? 23 times? No, that is way too large using the CPI. According to the Bureau of Labor Statistics CPI calculator, $100 is 1973 is equivalent to $518 in 2012 dollars for purchasing power.

But if Amtrak's operating loss was, for example, $361 million in 1975 that would be approximately equivalent to $1.54 billion today. The CPI is hardly a perfect adjustment for inflation, but it gets us in the ballpark. So if Amtrak had $253 million in ticket revenue in 1975, but a net operating loss of in the $350 million range, the total cost recovery percentage must have been much lower than today. However, in 1975 Amtrak was still working through the large variety of heritage equipment, facilities dumped on them and had not taken control of the NEC. A comparison to 1979 or later when the Amfleet Is had been delivered and Amtrak had ownership of the NEC would be a fairer comparison of where the company is at. But, lowest losses since 1975 makes for a good headline.
Mea culpa, The program I was using required an action I didn't take and so the number was wrong. It is about the same as yours, just a few percent different. But that is still half a order of magnitude.
 
There's always a dozen different ways to do the accounting for any complicated operation. You want to use different ones for different purposes. "Headlines" is not really a good reason for using any particular accounting method. :) So I wouldn't read too much into the number other than "Amtrak is doing pretty well lately".
 
There's always a dozen different ways to do the accounting for any complicated operation. You want to use different ones for different purposes. "Headlines" is not really a good reason for using any particular accounting method. :) So I wouldn't read too much into the number other than "Amtrak is doing pretty well lately".
It matters as to what benchmark(s) they have to keep meeting as well as evaluating cash available for other purposes. I'll translate it another way: $25 million is at least ten Viewliners' worth of cash.
 
If you need to actually pay for something look at the cash account. The other ones you can adjust a dozen ways. Just because you depreciated a different way or charged something as an extraordinary charge to spiffy up your GAAP reporting, does not really conjure up money that is really not there, at least for normal people and corporations. If you are the Federal Reserve it is a completely different ball game. :) In that case your job is to conjure up money or remove money from circulation.
 
Most of the accounting schemes other than cash are suitable for evaluating whether, *in the long run*, some action will be beneficial to you. Depending on what kind of action you're considering, you use somewhat different types of accounting. Depreciation is used to evaluate the relative merits of "building cheap" vs. "building durable", for instance.

None of the accounting schemes make it possible to make a meaningful comparison between "1975 losses" and "2012 losses".
 
Really, they should get rid of $$$ completely and compare revenue to expenses as a percentage. Looking at that over time will show true relative change.
 
I'd rather just look at ridership, myself. Passenger transportation is a public good; the more people travelling, the better we're doing. :)

By that standard, Amtrak is doing spectacularly well, with record ridership year after year. The good financial performance is a side-effect (because on trains, most of the cost is fixed in the sense that it's not dependent on the number of riders).
 
Figures often beguile me, particularly when I have the arranging of them myself; in which case the remark attributed to Disraeli would often apply with justice and force: "There are three kinds of lies: lies, damned lies and statistics."- Mark Twain's Own Autobiography: The Chapters from the North American Review
I should add that I quote this as the son of a tax accountant. ^_^
 
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I'd rather just look at ridership, myself. Passenger transportation is a public good; the more people travelling, the better we're doing. :)

By that standard, Amtrak is doing spectacularly well, with record ridership year after year. The good financial performance is a side-effect (because on trains, most of the cost is fixed in the sense that it's not dependent on the number of riders).
I must categorically disagree with this. By this standard, adding a large number of low-ridership trains would improve Amtrak's performance...even if those trains consumed hundreds of millions of dollars in added subsidies. I can definitely see arguments for looking at things on the basis of losses per passenger (or losses per passenger-mile), but ridership alone is a dubious metric for the fact that it encourages running any train as long as you might have a few spare cars sitting around.

Edit: To put this another way, Amtrak should simply run corridors at full frequencies 24/7 even if trains running at the off hours or on weekends are only picking up a few passengers.
 
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