CHI-MKE: Profitable?

[rtabern]

I am trying to figure out why they don't add MORE trains between Chicago and Milwaukee?!?!??

I mean funding might be an issue, but I would think that corridor is profitable. The trains are almost always packed... in fact... on Saturday 12/10 over 100 PEOPLE had to be turned away at CUS because there was no more room on the 5:08pm train.

Think about it... $20 a ticket... 70 people in a car... 4 cars.

$5,600 for a 90-minute trip. That's got to be profitable!

The other biggest problem is the last train leaves Chicago at 8:05pm. Why not add a 9pm or 10pm train? I mean if a LD train is late, they have to put everyone up in motels downtown (happened to me Tuesday night, December 5th coming in on the CZ).

 

[WICT106]

In a single word: No. Chicago-Milwaukee can generate only 90 miles per passenger per trip. Profits lie in the long haul passengers.

 

[Trogdor]

I'm assuming that, by 12/10, you actually meant Saturday, 12/9. It just so happens that I was on that train. Nobody was turned away. First of all, the Hiawathas are unreserved, so they can't really turn people away unless the train is absolutely, completely full. There were still empty seats on that train as we departed Chicago, and, IIRC, still a couple of empty seats leaving Glenview.

I was among the last to board train 339 (the 5:08) in Chicago, and there were no announcements, or agents telling people they couldn't board. I'm not sure where you heard that people were turned away because the train was full. In fact, in the past, I've seen standees on that train, a situation which certainly did not exist last night.

 

[AmtrakFan]

rtaben,

If they added a 10PM Train they could do it without an extra equipment set but the question is would IL/WI spring for it. That is the problem and IL isn't exactly in good financial shape. But then we would need a another train to balance out the equipment lack of balance.

 

[Trogdor]

In a single word: No. Chicago-Milwaukee can generate only 90 miles per passenger per trip. Profits lie in the long haul passengers.

That the train only "generates" 90 miles (actually, 86) per passenger per trip means nothing when it comes to the financial performance of a route. Amtrak does not charge fares by the mile.

In fact, let's compare the Hiawatha's $21 one-way fare to other routes.

Hiawatha (Chicago-Milwaukee):

End-to-end fare: $21

End-to-end distance: 86 miles

End-to-end scheduled time: 1h29

RPM (revenue per passenger-mile): 24.4 cents

RPH (revenue per passenger-hour): $14.16

Empire Builder (Chicago-Seattle):

End-to-end coach fare: $141 (as of 6:07 pm December 10, for the train departing Chicago on December 11)

End-to-end distance: 2206 miles

End-to-end scheduled time: 46h05

RPM: 6.3 cents

RPH: $3.06

Lake Shore Limited (Chicago-New York):

End-to-end coach fare: $80

End-to-end distance: 959 miles

End-to-end scheduled time: 18h30

RPM: 8.3 cents

RPH: $4.32

Other factors to consider (which are purely academic, as there aren't any "profitable" Amtrak routes anyway): The Hiawatha operates with a crew of three (two conductors and an engineer). Some trains have an LSA selling food from a cart. Long-distance trains have a larger crew, including train attendants, the lounge car LSA, and dining car staff of four to eight people.

The Hiawatha may only be a short route, but the passengers that ride it pay considerably more for the class of service they receive than many other routes.

 

[Dinker]

Other factors to consider (which are purely academic, as there aren't any "profitable" Amtrak routes anyway): The Hiawatha operates with a crew of three (two conductors and an engineer). Some trains have an LSA selling food from a cart. Long-distance trains have a larger crew, including train attendants, the lounge car LSA, and dining car staff of four to eight people.
The Hiawatha may only be a short route, but the passengers that ride it pay considerably more for the class of service they receive than many other routes.

Yes, all your points are very good. I'm always annoyed that a high-volume short distance route (say, NYP-WAS) costs more for the passenger than many much longer, lower-volume, higher-cost routes do. It's all the more frustrating when it seems clear to me that the future of rail travel is in the short- and medium-distance routes. But that's the way things are and I won't broach the subject of whether or not the NEC 'subsidizes' LD trains.

One thing though: isn't the Autotrain, at least, an unequivocally profitable route?

 

[Trogdor]

Speaking of fare comparisons for trips of different lengths, I recently booked a coach ticket from New Haven to Chicago for December 16.

The undiscounted coach fare is $101 for train 195 (NHV-WAS) connecting to train 29 (WAS-CHI). However, if one were to book a trip from New Haven to Washington, DC on train 195, it would cost $94. That is not to say that the WAS-CHI ticket price is $7 (it's actually $78 if booked alone). Just another quirk in the pricing system of today's intercity transportation carriers.

 

[Guest]

One thing though: isn't the Autotrain, at least, an unequivocably profitable route?

There is very little that is unequivocal when it comes to Amtrak accounting. "Officially", the Auto Train loses about $12M per year on a fully allocated basis (excepting depreciation and interest). It is, however, the only long distance train that covers its avoidable costs.

As for the Hiawatha, again, it officially loses about $11M on a fully allocated basis before the subsidy from Ill/Wisc is taken into account. Like the Auto Train, though, ticket revenues do cover the avoidable costs as defined by Amtrak, one of the few short-distance corridors to do so (others are the Empire corridor, Washington-Richmond, and the Carolinian and Pennsylvanian; all of these have relatively high yield per passenger mile). The Hiawathas get hit hard on shared costs by the Amtrak accounting system, probably because they have a lot of passengers and a lot of train starts, so my guess is that they pay for a lot of the costs of Chicago infrastructure.

In order for the Hiawathas to be profitable at the current fare structure, ridership would have to just about double without adding more trains, something that seems rather remote. (or, they could be operated by Metra, which almost certainly would have a lower cost structure).

 

[Dinker]

(or, they could be operated by Metra, which almost certainly would have a lower cost structure).

Why is that?

 

[Guest]

(or, they could be operated by Metra, which almost certainly would have a lower cost structure).

Why is that?

Pure conjecture on my part, but here are two reasons:

1) The Hiawathas would be a smaller share of Metra's operations out of Chicago than they are of Amtrak's, so their share of the fixed costs should be lower, and

2) They would no longer be charged their share of (significant) expenses associated with Amtrak management out of Washington.

On the other hand, they would lose whatever benefits they receive by being part of the national system, and there could potentially be additional access costs, since Metra doesn't benefit from Amtrak's statutory access to the freight railroads. There has been talk about Metra taking over all of the Illinois state-supported routes in the past, both when Amtrak raised the cost of 403( B ) service in the 1990s and during the budget showdowns in the past few years.

 

[WICT106]

There have been several railroad historians, Fred Frailey among them*, who have made the arguement that passenger trains as a whole have not been profitable since the 1920s. The ICC forumula for determining profitability may have been flawed (as some have argued), but it points out the weaknesses in a system where the highways nad the airports receive Trust Funds, while rail does not. I think some form of matching capital funding, perhaps on a 50-50 basis, would be made available based upon ticket receipts, where the host railroads would have money in order to maintain their lines to a 79 mph status. Perhaps a few states could set up something on the State level, where if you disembarked in a state you paid a fee equal to 10 percent of your ticket to that state for that state to use for capital funding for passenger rail. The funds would go into a trust fund, and the money would come out of a trust fund.

* Edit: for some reason or other, Roger Grant comes to mind as well, as does Don Hofsommer, and Albro Martin.

 

[frj1983]

One thing though: isn't the Autotrain, at least, an unequivocably profitable route?

There is very little that is unequivocal when it comes to Amtrak accounting. "Officially", the Auto Train loses about $12M per year on a fully allocated basis (excepting depreciation and interest). It is, however, the only long distance train that covers its avoidable costs.

As for the Hiawatha, again, it officially loses about $11M on a fully allocated basis before the subsidy from Ill/Wisc is taken into account. Like the Auto Train, though, ticket revenues do cover the avoidable costs as defined by Amtrak, one of the few short-distance corridors to do so (others are the Empire corridor, Washington-Richmond, and the Carolinian and Pennsylvanian; all of these have relatively high yield per passenger mile). The Hiawathas get hit hard on shared costs by the Amtrak accounting system, probably because they have a lot of passengers and a lot of train starts, so my guess is that they pay for a lot of the costs of Chicago infrastructure.

In order for the Hiawathas to be profitable at the current fare structure, ridership would have to just about double without adding more trains, something that seems rather remote. (or, they could be operated by Metra, which almost certainly would have a lower cost structure).

Funny you should mention Metra,

As the State of Wisconsin is now seriously talking about extending the Metra route to Kenosha farther north to Milwaukee! I'm not sure if such a routing would be helpful time-wise...if the train makes every stop on the schedule(including the new Wisconsin stops) it could well take 2 1/2 hours to get to Chicago from Milwaukee.

I'm hoping they'll see the wisdom in setting up some sort of express service!

 

[Trogdor]

As I understand it, the "Metra" extension from Kenosha and Milwaukee has been replaced with proposals to operate DMUs between Kenosha (or Waukegan) and Milwaukee, with cross-platform transfers to Metra for passengers continuing south.

Even if the route wound up being a Metra extension, I don't think there would be any express service, as the primary purpose of that line would be to get people from the Southeastern Wisconsin suburbs to Milwaukee (and vice versa), rather than to Chicago. WisDOT's position is, and has been for quite some time, that this service is not to compete with or replace the Hiawatha service between Chicago and Milwaukee, so I don't anticipate any attempt to speed up the Chicago-Milwaukee end-to-end times on the UP line.

 

[saxman]

Amtrak finance. My favorite topic.

We can sit and compare end point to end point RPM's, but we also have to think about the the other markets along routes. It's all about what the going rate is for A to B markets. New Haven to Chicago is probably not a high demand as much as there to DC. I was a frequent rider from Grand Forks to St. Paul for about $40 or as much as $80 last minute. Thats a six hour ride which is 315 miles.

On the contrary I ride from Austin to Fort Worth for less than $20! Thats about 200 miles and 4 hours. And you certianly can't drive for less than that.

I rememeber buying a plane ticket from DFW to Chicago to catch the Builder there. Then I saw what it would be to fly into Milwaukee. It was quite a bit cheaper to MKE even though I was connecting at Chicago Midway anyway. So it doesn't matter where you connect. It's the O&D that matters.

If someone really has time on their hands, they should compare all the cities pairs, and get the RPM's.

 

[frj1983]

Amtrak finance. My favorite topic.
We can sit and compare end point to end point RPM's, but we also have to think about the the other markets along routes. It's all about what the going rate is for A to B markets. New Haven to Chicago is probably not a high demand as much as there to DC. I was a frequent rider from Grand Forks to St. Paul for about $40 or as much as $80 last minute. Thats a six hour ride which is 315 miles.

On the contrary I ride from Austin to Fort Worth for less than $20! Thats about 200 miles and 4 hours. And you certianly can't drive for less than that.

I rememeber buying a plane ticket from DFW to Chicago to catch the Builder there. Then I saw what it would be to fly into Milwaukee. It was quite a bit cheaper to MKE even though I was connecting at Chicago Midway anyway. So it doesn't matter where you connect. It's the O&D that matters.

If someone really has time on their hands, they should compare all the cities pairs, and get the RPM's.

That is an interesting way to think about it Saxman66,

A friend of mine recently has been riding the Hiawatha back and forth bewteen Chicago and Milwaukee for her work. She mentions that in the last few weeks between 35-50 people have boarded in Chicago(daily) and then have gotten off at the new Milwaukee Mitchell Field Station. Evidently, many of them are opting to fly out of Milwaukee rather than out of O'Hare or Midway.

 

[MrFSS]

A friend of mine recently has been riding the Hiawatha back and forth between Chicago and Milwaukee for her work. She mentions that in the last few weeks between 35-50 people have boarded in Chicago(daily) and then have gotten off at the new Milwaukee Mitchell Field Station. Evidently, many of them are opting to fly out of Milwaukee rather than out of O'Hare or Midway.

Or, it could be they are taking advantage of the ample parking at that station. They could live on the south side of MKE and its just convenient for them. Especially if its the same people every day.

 

[frj1983]

A friend of mine recently has been riding the Hiawatha back and forth between Chicago and Milwaukee for her work. She mentions that in the last few weeks between 35-50 people have boarded in Chicago(daily) and then have gotten off at the new Milwaukee Mitchell Field Station. Evidently, many of them are opting to fly out of Milwaukee rather than out of O'Hare or Midway.

Or, it could be they are taking advantage of the ample parking at that station. They could live on the south side of MKE and its just convenient for them. Especially if its the same people every day.

That's an interesting thought too!

But I don't remember her saying it was the same people everyday...in fact, she was indicating that these were definitely flyers out of Mitchell because she talked to some of them.

 

[battalion51]

You could probably also tell based on the amount of stuff they have with them. If there's a laptop, duffel bag, and overnight in tow, odds are they aren't commuters. B)

 

[Trogdor]

It probably also depends on the time of day. If they're going up (to MKA) in the morning or early afternoon, they could be flying. If they're on the last couple of trains of the evening (when there are very few flights left for the day), then they're probably just going home.

 

[Guest]

I flew in to Milwaukee a few months ago and stopped by the station to see 337 arrive. This was a Friday afternoon, and about 70 people got off of the train. I'd say that maybe 10 of them got on to the shuttle bus to the airport; the rest either had rides waiting or had parked at the station. I have to say that I was impressed with the number of passengers. For the first 6 months of 2006, MKA is beating Glenview and Sturtevant in terms of ridership.

 

[frj1983]

One thought has always occurred to me about the CHI-MKE service:

I wonder why a regular summer stop is not made in Gurnee? (Great America and the Gurnee Outlet malls nearby) Thousands of people drive down from Wisconsin to go to these 2 places every summer and many more from the Chicagoland area...wouldn't such a stop draw more passengers to Amtrak?

 

[rtabern]

I'm assuming that, by 12/10, you actually meant Saturday, 12/9. It just so happens that I was on that train. Nobody was turned away. First of all, the Hiawathas are unreserved, so they can't really turn people away unless the train is absolutely, completely full. There were still empty seats on that train as we departed Chicago, and, IIRC, still a couple of empty seats leaving Glenview.
I was among the last to board train 339 (the 5:08) in Chicago, and there were no announcements, or agents telling people they couldn't board. I'm not sure where you heard that people were turned away because the train was full. In fact, in the past, I've seen standees on that train, a situation which certainly did not exist last night.

"RMADISONWI"..... You were on that train on 12/9 (yes, thanks for the correction... 12/9) at 5:08pm departure from Chicago? If you were at the back of the line... you were also near me too! You wouldn't happen to be the man I chatted with who was going to the CP Christmas train at SVT were you??

I took the train from Chicago to Glenview that night. There were 20-30 people standing in the last car of that train... at least at the Glenview stop. It was the young assistant conductor on the train who told me that he had to turn dozens of people away at the gate for that train. Maybe he was just exagerating then... I dunno? I chatted with him when I got off at GLN and he was killing about 2 minutes so they could depart right "on time" and not early. The asst. conductor said that he thought it was too much of a safety hazard to have more people than that standing... and he turned people away. So that is where I got my info, but maybe he wasn't right? I dunno.

 

[Trogdor]

I was going to see the holiday train, but I was with a couple of coworkers (who I just happened to run into, by chance, as I left the Metropolitan Lounge at around 5:00 pm), and don't specifically remember chatting with anyone else on the way up, though we did talk to some guy on the way back down.

I took the train from Chicago to Glenview that night. There were 20-30 people standing in the last car of that train... at least at the Glenview stop. It was the young assistant conductor on the train who told me that he had to turn dozens of people away at the gate for that train.

Something doesn't add up, here. As I noted earlier, there were at least a few empty seats at the front of the train. Therefore, there should have been no standees (at least, not until the seats were filled).

Secondly, I vaguely recall learning (from a friend of mine who spoke with the conductor upon boarding in Glenview en route to Sturtevant) that the rear car was reserved for some sort of special group (not exactly sure what the group or occasion was). So, if *that* car was somehow full, then perhaps there were people intending to be a part of whatever group it was that were turned away. But, if they were just regular Hiawatha passengers, there was more than enough room on board, and I don't see how any conductor could possibly think of turning people away without first checking the train to see if seats were available.

 

[rtabern]

RMADISONWI-

Ah... guess that wasn't you then. I ran into a man (who was by himself and carrying a bag full of canned goods) who was headed to the holiday train in Sturtevant that night... and it was at the back of the line too... so I thought that might have been you... (I've never seen the line for that stretching all the way back past the Metro. lounge before!) but guess not if you were with a group of people. Egh, maybe we'll cross paths sometime down in CHI. I do a lot of rides on Saturdays -- and always carry my Amtrak duffel bag with a conductor's badge (e-bay) on it.

 

[AMTK1007]

The situation with the Hiawatha Service is complecated... the CP needs capacity improvements, there would probably need to a third set of equipment... and there ar crewing needs..

All IS being looked at but don't look for anything soon...