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CHamilton

It’s Time We Stood Up to Amtrak

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I hope we can get the “575” (sic! Actually 535) to do much simpler things like insert a line rescinding the “F&B standing as a separate profitable P&L center” requirement, before throwing the baby out with the bathwater.

 

 

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Wouldn't it be a better idea if they stood up to Congress? After all, they provide the  funds and direction for a lot of what does and doesn't occur. For all the complaints about food service, cuts in amenities and service, it was Congress that passed laws calling for the cuts in costs and elimination of funding for food service.

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4 minutes ago, jis said:

I hope we can get the 575 to do much simpler things like insert a line rescinding the “F&B standing as a separate profitable P&L center” requirement, before throwing the baby out with the bathwater.

&

2 minutes ago, Thirdrail7 said:

Wouldn't it be a better idea if they stood up to Congress? After all, they provide the  funds and direction for a lot of what does and doesn't occur. For all the complaints about food service, cuts in amenities and service, it was Congress that passed laws calling for the cuts in costs and elimination of funding for food service.

Is there any evidence that Anderson actually wants the F&B rules changed or that he thinks they're detrimental to Amtrak's future as currently written?

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2 minutes ago, Devil's Advocate said:

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Is there any evidence that Anderson actually wants the F&B rules changed or that he thinks they're detrimental to Amtrak's future as currently written?

I'm not sure he personally cares one way or the other but Mr. Anderson has been clear that he will follow PRIIA and is also governed by the FAST act. One of the provisions is to eliminate F&B losses and by Dec 4th, 2020, federal funds will not be used to cover F&B losses.

As such, he intends to comply with provisions of the FAST act.  If the law didn't exist,  it might have still been on his radar but maybe it wouldn't have a sense of urgency...particular;y if you could lobby to offset the losses with additional funding.

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The secret to F&B profitability or not depends on two factors:

1. Costs
2. Revenue

Without accurate accounting of each, one can’t evaluate what, if anything, needs to change.

I have not heard anyone set forth how revenue for the sleeper passengers is allocated.

Since the meals are part of the room charge, the question is how much is allocated to the F&B? Further, since the room charge is the same whether there is one or two ( possibly more in the family bedroom), an argument can be made that the F&B allocation should be enough to cover the maximum no in the room so that if there is only one in the room, there should be extra profit!

The above is just theoretical since I’ve seen nothing to explain how revenue is determined.

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Thirdrail can correct me, but in general revenue is transferred to the F&B account based on the actual consumption recorded in the Diner bills.

This incidentally has been discussed a dozen times in AU over the years.

The bottom line though is that F&B should not be a separate P&L center. No one else operate that way.

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Thirdrail can correct me, but in general revenue is transferred to the F&B account based on the actual consumption recorded in the Diner bills.

This incidentally has been discussed a dozen times in AU over the years.

The bottom line though is that F&B should not be a separate P&L center. No one else operate that way.


I have heard that before but if revenue from sleeper passengers is based upon consumption, then it is clearly an incorrect method of accounting for revenue for F&B.

As indicated before, the cost of meals for sleeper passengers is included in the room charge.

If there is one passenger, and that passenger skips all meals, under a revenue based upon consumption, there is no revenue to offset F&B costs.

In reality, the passenger who doesn’t eat or eats little, actually has a positive impact upon costs and results in potentially a greater chance for profitability. The revenue, which is actually the amount of the sleeper charge covering the meals ( as I mentioned above - this should properly reflect an allocation for potential passengers in the room).

If they are allocating revenue based upon consumption, then they will never show a profit. The only reason to record consumption for sleeper passengers is to allocate costs.

With regard to coach passengers, of course who actually pay separately from their ticket for the meals, consumption is a proper way to track revenue and costs.

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I can agree with that myself, not that it matters a hill of beans either way

 

But instead of trying to micro manage this we should work towards removing the requirement for having a separate F&B account that has to be separately balanced. That ought to be the major takeaway from all these endless discussion as far as I am concerned.

 

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Jim Loomis did a better job of proving the RPA detractor's point than the RPA detractor did. Every example cited in the detractor's points were to restore service or expand frequency, and yet Jim Loomis' takeaway is to fight back...on dining cars?

It's attitudes like this that have made me rather ambivalent towards RPA; I'm glad that such an organization exists, but it seems to steer towards the wrong focus fairly often. The general public (and, I'd argue, most of the rail-traveling public) cares much more about seeing better frequency and more routes than about what the dining car service is like. It's certainly a lot harder to get that work done, but that's also the work that needs to be done if we want a truly better passenger rail system that's more relevant to more Americans.

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I would also like to see easing up on the seeming requirement that all overnight trains must have Sleepers. I think that unwritten thing prevents the consideration of several possible trains which would probably do fine even as an LD Coach and Cafe train, at least allowing getting the foot in the door on those route, or perhaps a second frequency on part of a route.

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I think you'd have issues without a single sleeper (but the overarching issue of acquiring more sleepers comes to mind).  I'm not saying that ridership would be zero on a chunk of such a route, merely that you'd have trouble attracting at least some chunk of through ridership on those lines.

Just wondering, but what route(s) do you have in mind, jis?

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Pioneer for one. I don’t think there would be an issue because 20 rich people cannot lie down if 240 not so rich people can get to places they need to get to. Actually even the Gulf Coast thing could be started as a Coach service.

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I think it's a little bit disparaging to write it off as "20 rich people".  I know that some of the members on here aren't exactly rolling in the dough.

With that being said, in many ways I think that's the problem right there: The sleepers have been shoved into nosebleed pricing vis-a-vis most coach seats (it isn't uncommon for me to be able to get a ticket in first on Delta to Florida for less than a sleeper on Amtrak).

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The two overnight trips I have booked are cheaper than a hotel plus one-way airfare.  They will save me from paying for both.  You don’t have to be rich to see the advantage of a sleeper in that situation.  

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It fascinates me how very well off people hate to be called rich. Seems like a cultural thing in some parts of the world. It is always the case that no matter how well off one is, it is only the ones more well off that are qualified to be rich :lol:

I think it is pretty fair to say that something like the top decile is rich. It is entirely possible that a few who are not there choose to spend money selectively on travel and therefore are able to afford Sleepers and good hotels.

In any case I was being "tongue in the cheek" in using the terms "rich" in connection with those who travel in Sleepers. I apologize if I hurt anyone's feelings by insinuating that they may be rich. :unsure:

Anyway, the point regarding starting new trains is that since all trains have three to five or even six Coaches relative to one to three Sleepers, it is hard to believe that all those people that fill those Coaches would stop riding if there were no Sleepers attached to the train. Thus waiting for getting Sleepers and all the paraphernalia that go with the associated service should not prevent us from starting a Coach only train where there is possibility of significant demand. That is by no means suggesting that it would not be nice to have Sleepers too. It just prioritizes starting new trains over having Sleepers in every train.

BTW, The original Pioneer started as a Coach only service...

http://www.timetables.org/full.php?group=19770501&item=0055

 

Edited by jis

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While I have nothing against running a train with all coaches because you are waiting for your sleeper order to come back from the factory,... I don't think the Pioneer would be viable under any circumstances.

In fact, I absolutely disapprove of the idea of prioritizing starting new trains!  The priority needs to be greater frequencies, and better OTP, on existing routes.

If there are any new overnight routes where there is the possibility of significant coach demand (perhaps the oft-mooted Florida-Chicago or Florida-New Orleans services), I remain certain that they would perform better financially with a sleeper tucked on.  It is as easy to order new sleepers as it is to order new coaches -- easier, for single-level trains, because they've already been ordered (and Amtrak should damn well get them delivered ASAP).

When putting second frequencies on existing routes, it is possible that one of them will be better off with no sleepers.  It is more likely that both frequencies should have a sleeper, and  I am quite sure that that's the better option for NY-Chicago via the Water Level Route.

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Probably for some of the routes but only on portions of it. An example would be another frequency over the NYP-ATL portion of the Crescent or a MSP-CHI frequency on the Empire Builder route.

You noticed the difference along the route of the Pennsylvanian when the Broadway Limited was cut. Conversely, CVS's number climbed on the Cardinal when they added a regional to the route. An additional frequency on a good  travel pattern (day/night, early morning/afternoon as an example) can help out (assuming the LD train is somewhat reliable).

It works on corridor routes as well.

 

Edited by Thirdrail7

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I would point out that the only way to get better frequency is to start new trains on existing routes, and same considerations regarding equipment applies. Indeed the pressure to include Sleepers on a new train on a route that already has a train with Sleepers is probably even less.

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11 hours ago, jis said:

I would point out that the only way to get better frequency is to start new trains on existing routes, and same considerations regarding equipment applies. Indeed the pressure to include Sleepers on a new train on a route that already has a train with Sleepers is probably even less.

Additional frequencies typically cover only part of the route, often  determined by the willingess of states to support them financially. Think of the Lincoin Service providing (partial) extra frequency that supplements the Texas Eagle, or the Quincy services party augmenting the Caifornia Zephyr, or also all the various partial (if not accidental) overlaps between LD and state supported service in states like NC or CA, .

Maybe in an ideal world, such services might over time be extended further along the route of the main train they duplicate, maybe a couple of stops at a time as ridership and support builds up. Maybe this is a more sustainable and less risk prone strategy than going the full bang of a second end to end train in an environment such as that of today where the climate is not conclusive to obtaining additional funds or massively adding new equipment. And where furthermore Amtrak has countless enemies who are just waiting to pounce on any bad news such as a new train not performing as well as projected, and just waiting to use this as ammunition to do more damage to Amtrak.

This "stealth approach" would also automatically lay to rest the debate over sleepers or no sleepers as obviosly such shorter trains don't need sleepers. 

 

 

Edited by cirdan

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On 1/7/2019 at 8:11 PM, jis said:

I hope we can get the 575 to do much simpler things like insert a line rescinding the “F&B standing as a separate profitable P&L center” requirement, before throwing the baby out with the bathwater.

 

Actually, it would be nice if Congress would explicitly state that Amtrak's purpose in life is to maximize ridership, not revenue or profitability.  Seems to me that the point of sinking taxpayer dollars into something like Amtrak is to get the maximum number of possible passengers riding trains, with the public purpose of reducing road congestion, reducing emissions, reduced loss of life and injury by getting people out of cars, etc.  Plus high speed rail to compete with short haul airlines, reduce airport congestion, and reserve capacity for trans continental and intercontinental flights.  

Edited by MARC Rider

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Unfortunately Congress has never agreed to that principle, let alone going so far as to direct Amtrak to that effect. They have never backed away from the “for profit” corporation language. While you and I might agree on this I am not sure that enough of the 535 agree with us to make it so yet. Maybe some day.

 

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9 hours ago, jis said:

Unfortunately Congress has never agreed to that principle, let alone going so far as to direct Amtrak to that effect. They have never backed away from the “for profit” corporation language. While you and I might agree on this I am not sure that enough of the 575 agree with us to make it so yet. Maybe some day.

Well, I  hope RPA is keeping tabs on how many more of the 575 are needed to come over from the dark side and change policy for the better.

 

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