Amtrak Crows About Ridership Gains

Amtrak on Tuesday touted ridership gains during fiscal year 2021 in a news release issued two days before a public meeting of its board of directors.

The release, though, presented a mixed picture of the passenger rail carrier’s finances.

Although ridership was up substantially on Amtrak’s three business lines, revenue fell in two of the three.

The report covers the period of Oct. 1, 2021, to Sept.30, 2022, which mirrors the federal fiscal year.

Ridership in the Northeast Corridor rose 110 percent while state corridor services ridership was up 85 percent and long-distance train patronage was up 56 percent.

However, the operating revenue of $2.8 billion in FY2022 was 15 percent below that of FY 2019, the last period to begin before the COVID-19 pandemic took hold in March 2020 and sent ridership and revenue plummeting across all business lines.

The report sought to put a positive spin on revenue by saying the adjusted operating earnings at $884.9 million were an 18.2 percent improvement over fiscal 2021 and “$145 million ahead of Amtrak’s FY22 plan due to strong ticket revenue growth.”

The report will be presented to Amtrak’s directors at a meeting on Thursday in St. Louis.

The report released on Tuesday does not provide revenue information by route or business category.

That is consistent with past practices of the carrier to omit this information from public reports.

Earlier this year, Trains magazine reported that information it obtained showed long-distance revenue was up 23 percent in FY2022 compared with FY2019 while revenue for the Northeast Corridor and state corridor services were both down about 30 percent.

The report Amtrak released this week said it expects ridership and revenue to improve above 90 percent of pre-COVID levels by the end of FY2023.

Amtrak Ridership, Revenue Growing, but Results Have Been Uneven Across the Network

Amtrak continues to make progress in clawing back ridership and revenue lost during the COVID-19 pandemic although individual routes have produced uneven results as the effects of the pandemic continue to linger.

Figures published on the website of Trains magazine show that during fiscal year 2022, which ended Sept. 30, Amtrak garnered $1.78 billion in gross ticket revenues. Ridership was 22.9 million passengers.

The report noted that revenue of $113 million posted by long-distance trains was up 24 percent over 2019.

Much of that increase was recorded by the Auto Train, which operates between Lorton, Virginia, and Sanford, Florida.

Revenue earned by Northeast Corridor and state-funded corridor trains fell by 30 percent.

The Trains report said Auto Train per passenger revenue increased 34 percent in FY 2022. The corresponding figures for state-funded trains was 2 percent while Acela and Northeast Regional per passenger ridership was down a negative 6.8 percent.

The Trains report concluded that long-distance trains have benefited from higher ticket prices, which was related to decreased capacity due to shortages of available equipment.

That is because Amtrak is reaping higher revenue yields from fewer passengers.

During the pandemic, Amtrak mothballed many passenger cars and furloughed workers.

Once demand picked up the company struggled to have enough mechanical workers to return those idled cars to revenue service.

Ridership data reported by Trains showed that corridor routes that are more dependent upon commuter travelers are generally lagging longer corridor routes as large numbers of workers continue to work remotely.

The Trains report can be read at https://www.trains.com/trn/news-reviews/news-wire/capacitys-impact-shows-in-amtraks-fiscal-2022-revenue-and-ridership-analysis/

Amtrak Seeking $3.3B in FY2023

Amtrak is asking Congress for $3.3 billion in grant funding for federal fiscal year 2023.

The passenger carrier said in a statement that accompanied its grant request that the funding will enable it to enter a new era with a historic level of federal investment for capital projects.

CEO Stephen Gardner said funding provided by the Infrastructure Investment and Jobs Act provides Amtrak with “a clear plan to transform and grow our business.”

“Our requested FY2023 annual grant will allow Amtrak to continue operating our long-distance trains, which connect communities across the nation; to continue partnering with states to provide short-distance corridor service; and to continue normalized replacement (necessary maintenance and sustainment) of aged assets on the Northeast Corridor, all while facing new levels of uncertainty and disruption from the ongoing COVID-19 pandemic,” Gardner said in the statement.

The grant request includes $1.1 billion for the Northeast Corridor and $2.2 billion for the national network.

The budget request projects that ridership in FY2023 will be 28.8 million. During FY2019 Amtrak handled 32.5 million passengers. It carried 16.8 million in FY2020 and 12.2 million in FY2021. Expected ridership for FY2022 is 23.2 million.

Projected revenue for FY2023 is $1.98 billion in gross ticket revenue; $3.1 billion in total operating revenue; and an adjusted loss of $1 billion.

Amtrak Lost $1.08B in FY2021

Amtrak lost $1.08 billion in adjusted operating earnings during fiscal year 2021.

In a report summarizing its FY2021 activities, the passenger carrier blamed the loss largely on lost revenue from ridership plunges during the COVID-19 pandemic.

The report said Amtrak provided 12.2 million passenger trips, an increase of 4 million over FY2020 ridership.

Ridership in FY2021 was 42 percent over the goal and has now reached 70 percent of pre-pandemic levels.  More than half of the FY2021 ridership came in the second half of the fiscal year.

Amtrak said it expects ridership in FY2022, which runs through Sept. 30, 2022, to be 80 percent of its pre-pandemic level.

The report emphasized that the fiscal results are preliminary. The adjusted operating earnings were $400 million “ahead of plan,” Amtrak said.

During FY2021, Amtrak said it advanced $2.2 billion in capital spending, including major milestones such as the acquiring property for the Hudson Tunnel Project between New Jersey and New York City and buying new multi-powered trainsets from Siemens Mobility.

FY2021 Figures Show How Much Ridership, Revenue Amtrak has Lost in the Pandemic

Amtrak’s fiscal year ended on Sept. 30 and information on how the passenger carrier performed during the COVID-19 pandemic is starting to trickle in and show the scope of how much revenue and ridership it lost.

The pandemic overlapped two fiscal years to date, 2020 and 2021. Amtrak’s fiscal year extends from Oct. 1 to Sept. 30.

In FY 2021, ticket revenue and ridership were both down 63 percent compared with FY 2019, the last “normal” year Amtrak had before the onset of the pandemic.

In FY 2021 Amtrak generated $882.8 million compared with FY 2019 mark of $2.3 billion.

Ridership in FY 2021 was 12.8 million passengers compared with 32.8 million in FY 2019.

All three of Amtrak’s services – long distance, Northeast Corridor and state-supported corridor services – lost revenue and ridership in FY 2021.

In response to the pandemic, Amtrak reduced service by offering fewer trains. Although no long-distance trains were suspended, all but the Auto Train operated on tri-weekly or quad-weekly schedules.

On a percentage basis, the long-distance trains lost the least amount of revenue with compared with FY 2019. The percentage loss was 33 percent.

State supported trains revenue fell by 61 percent while in NEC services fell by 74 percent.

Ridership on a percentage basis fell 51 percent in FY 2021 compared with FY 2019. The corresponding  percentage declines for state services and the NEC were 64 percent and 65 percent respectively.

Revenue for long distance trains for the past three fiscal years has been 330.7 million, 308.2 million and $494.6 million.

For state services it was 209.3 million, $281.7 million and 538.1 million. For the NEC the corresponding numbers are 882.8 million, 1,241.6 billion and $2.354.3 billion.

Ridership of long distance trains by fiscal year from 2021 to 2019 was 2,238.0 million, 2,689.5 million and 4,554.8 million.

For state service the ridership numbers for the same period are 5,519.9 million, 8,004.3 million and 15,438.8 million.

For the NEC the ridership numbers were 4,408.8 million, 6,417.5 million and 12,526.6 million.

It should be noted that FY 2020 straddled the pre-pandemic and pandemic eras.

Among the long distance trains, the Auto Train managed to earn more in FY 2021 (85.7 million) compared with FY 2019 (76.7 million).

One reason given for that was the fact that the Auto Train continued to operate daily between fall 2020 and late spring 2021 and high rental car prices in Florida triggered by a shortage of rental vehicles encouraged traveling to take their own vehicles on the Auto Train.

The Auto Train, though, had reduced capacity just as did other long distance trains.

Although most state corridor services that were suspended during the pandemic have been restored, corridor trains that extend in Canada are still not operating across the border due to pandemic-related travel restrictions.

This includes the New York-Montreal Adirondack, the New York-Toronto Maple Leaf and the Seattle-Vancouver Cascades. These continue operate within the United States.

Flynn Expects Job Cuts, Tri-Weekly Trains

Amtrak expects to furlough employees in fiscal year 2021 and expects long-distance trains to operate twi-weekly its president told Progressive Railroading magazine in an interview.

William Flynn

The job cuts and reduced service are likely because the carrier expects ridership to continue lagging into 2021.

William Flynn, who took over as Amtrak’s CEO on April 15, said ridership is now 18 percent of what it was in fiscal year 2019.

He said ridership rose between late May and early July, but has since hit a plateau due to outbreaks of COVID-19 in some parts of the country.

Although Flynn did not elaborate on how many workers might lose their jobs, he said the carrier has yet to furlough anyone in the current fiscal year, which extends through Sept. 30.

Flynn spoke in the interview as though the move to tri-weekly service by all of Amtrak’s long distance trains except the Auto Train on Oct. 1 will occur.

An FY2021 budget approved by the U.S. House of Representatives contains funding for daily service of those trains and a mandate to Amtrak not to furlough employees.

The Senate has yet to act on its own FY2021 budget proposals and the fate of the House budget proposal is uncertain.

During the interview, Flynn did not address the congressional action and continued to defend Amtrak’s plans to reduce the frequency of service of long distance trains.

“We remain fully committed to the long-distance service; that I want to make clear,” he said

“But at this point in time, the levels of ridership we expect to see in November, December, January, February and March indicate to us that moving to three-day-a-week service at that period of time is the right thing to do for [Amtrak] and for our owners, the government.”

Flynn said Amtrak will review the performance of the long-distance trains early next year, examining such things as future bookings and whether those justify restoring service to daily operation in late May or early June of 2021.

Currently, Flynn indicated that most Amtrak travel has been those traveling for personal reasons, including families. The carrier is seeing very little business travel.

Amtrak’s marketing department has been surveying its customer base to try to get a handle on what its prospective travel plans might be, including when they might travel again, how often they expect to travel and what the purpose of their travel will be.

Flynn said the carrier has been experimenting with pricing and has been able to gain many first-time customers in the Northeast Corridor.

In the meantime, Amtrak has delayed some capital projects to conserve cash and is seeking to eliminate discretionary spending as much as possible.

“We do need to resize the company to reflect the level of ridership that we anticipate in 2021, and no one has great visibility into what 2022 might look like,” Flynn said.

When asked what capital projects Amtrak has deferred, Flynn said, “It wasn’t necessarily larger projects around infrastructure.”

He said the carrier has made “huge progress on our key engineering projects on the Northeast Corridor.”

But it has put off some projects in information technology that it plans to take up later.

Flynn insisted that Amtrak’s long-term vision remains unchanged and that includes network growth.

He repeated the goals expressed by his predecessor, Richard Anderson, that Amtrak wants to provide new service or additional service to major metropolitan areas that have grown substantially in the past 40 years.

“So, it remains our strategy that we can double ridership on Amtrak over the next 20 years,” he said.

“There are key corridors that exist — many of which exist on long distance routes — that aren’t served today that would absolutely benefit from, and rightly demand, high-quality passenger-rail service.”

Some Amtrak Trains Are ‘Selling Out’

Although Amtrak trains continue to run with loads well under capacity, an analysis published on the Trains magazine website reported that some trains are selling out as ridership slowly begins to rise.

Of course Amtrak is only selling half the capacity of its coaches as a way to enforce social distancing and the sell outs or near sellouts have resulted in some high eye popping fares.

That included a coach fare of $260 from Chicago to Dallas, but $251 from Chicago to Pontiac, Illinois, a distance of 92 miles.

Yet a coach seat between Chicago and Normal, Illinois, a distance of 124 miles was available for a fare of $124.

Blame a yield management system that increases fares for segments with the heaviest ridership.

Amtrak spokesman Marc Magliari told Trains that Amtrak consists changed little between April and May.

However, the consists of some trains have since expanded. The Lake Shore Limited has been reported to now be operating with four Amfleet coaches, two for the New York section and two for the Boston section.

That is double the number of coaches that had been carried.

The Capitol Limited has been reported to have expanded from four cars to five or six.

Trains passenger correspondent Bob Johnston rode Amtrak’s Texas Eagle recently between Chicago and Normal.

His report indicated that the bathrooms, coaches and Sightseer lounge cars were clean on both trains and although passengers wore masks while boarding the train about half removed them after settling into their seats.

Johnston wrote that most passengers wore their masks while walking through the train.

He also said some food items were out of stock in the café car, including all of the fresh deli sandwiches and cheeseburgers.

Few passengers ate their meals in the lounge car after purchasing food there.

A spot check conducted by Trains over a 15-day period found numerous instances in which coach seats were sold out or nearly sold out on some long distance trains.

The westbound Lake Shore Limited had no day-of-departure coach seats on 11 of 15 days out of New York when No. 48 operated with a single Amfleet II coach.

Some seats that were available were priced at twice the normal $112 fare.

The spot check determined that sleeping cars were rarely sold out during the 15-day period.

Amtrak has not yet increased fares for sleepers much above the usual summer rates.

Trains also reported that it has learned that Amtrak on May 29 operated a special train of 15 empty Amfleet II coaches from the Hialeah Maintenance Facility in Miami to Jacksonville, Florida, for storage.

Service Cuts Likely for Amtrak Long-Distance Trains

Thus far during the economic downturn that has accompanied the COVID-19 pandemic Amtrak’s long-distance trains have been spared service cuts.

But that will soon change.

In a letter to Congress dated May 25 Amtrak said it is seeking $1.475 billion in “supplemental funding” to maintain “minimum service levels across the rail network” and continue capital projects.

This will be on top of the $2.04 billion that it requested for its regular federal fiscal year 2021 appropriation.

Even if it gets the additional funding, Amtrak said it plans to reduce the frequency of service on most long distance routes to less than daily service.

The passenger carrier also said it may cut its workforce by as much as 20 percent.

Amtrak said during the pandemic its routes are at best handling 10 percent of the ridership that they had as recently as February and that for FY2021 the passenger carrier expects ridership to be 50 percent of what it would have been otherwise.

The letter, written by Amtrak President William Flynn, acknowledged that projecting future ridership and revenue is difficult given the unprecedented nature of the pandemic and all the unknowns surrounding its trajectory.

However, most projections anticipate a second wave of infections in the fall and Amtrak expects that to depress ridership between September and February.

Recent polling data shows half of the respondents saying they would be reluctant to ride a train in the next six months and more than a third said they it could be a year or more before they would ride a train.

“Furthermore, when demand returns, we anticipate that changed behaviors, such as increased telework and reduced discretionary income, will likely impact ridership, along with capacity limits that may be needed to achieve social distancing on our trains,” Flynn wrote.

Aside from cutting long-distance service to less-than-daily service, Amtrak said it will sharply cut Northeast Corridor service to match demand.

Flynn said Amtrak expects reduced services in state-funded corridor service and is working with the states to determine what they will be able to fund in FY2021, which begins on Oct. 1.

“While our state partners will ultimately make these decisions in coordination with us, many of them have been clear that they will not be able to maintain currently reduced service or resume suspended service without supplemental funding,” Flynn wrote.

Amtrak said it would restore service levels to what they had been once ridership recovers sufficiently to support it if adequate funding is available.

Flynn’s letter contained few details as to how much reduction in frequency of service would occur in the next fiscal year unless Amtrak receives supplemental funding.

An appendix mentions consolidation of the Silver Meteor, Silver Star and Palmetto and hints that without additional federal funding some corridor services might be suspended or discontinued.

All long-distance trains except for the Auto Train are expected to operate at a lower level of service even if Amtrak receives the supplemental appropriation.

Without the supplemental appropriation, all long-distance trains except the Auto Train are said to be “at risk.”

In a message to Amtrak employees on Tuesday, Flynn conceded that Amtrak’s planned spending cuts “will cause stress in the organization.”

He said the carrier will seek to “minimize the negative impact” by offering incentives for employees to leave the company or retire before resorting to layoffs.

Flynn said Amtrak management is still figuring out how much it plans to reduce its workforce and how to assign those who remain on the payroll.

Amtrak expects to cut $500 million in expenses as a result of reducing frequency of operation and capacity ($150 million) and workforce reductions ($350 million).

Amtrak’s April Ridership Was Bad, But Bookings for Long-Distance Trains is Looking Promising

Amtrak ridership data for April was released this past week and it showed a sharp plunge compared with a year ago.

In April 2020 Amtrak handled 120,000 passengers compared to 2.7 million who rode in April 2019.

The ridership drop is attributed largely to the COVID-19 pandemic.

The Northeast Corridor handled 19,000 passengers, a drop of 97.5 percent from a year earlier. It was the steepest ridership plunge system wide on a percentage basis.

Amtrak lost 87 percent of its passengers on the San Joaquin route in California.

Ridership of state-funded corridors fell 96 percent while the long-distance trains saw ridership fall 86.8 percent.

Year-to-date ridership is down 21 percent and revenues has fallen by 19 percent.

Amtrak expects those figures to grow and they might have been larger than they were but for strong ridership and revenue performances earlier in the year before social distancing measures were imposed.

In a related matter, the Amtrak vice president who oversees long-distance trains said the use of prepackaged meals for sleeper class passengers on Western trains will continue for at least another month.

Larry Chestler told the Rail Passengers Association that Amtrak has begun to see some early signs of recovery on many routes.

However, he cited safety and continued lagging ridership for waiting to restore traditional dining car service to the Western trains.

Chestler said the carrier will evaluate ridership data in late June and determine at that time whether to restore traditional dining car service.

The prepackaged meals have been served to sleeper class passengers on Eastern long-distance trains since June 2019 and were extended to all of those trains last October.

Although the long-distance trains have seen steep ridership drops, Chestler said those declines have been smaller than on other routes.

A recent rise in bookings for long-distance trains have given Amtrak some hope that higher demand is coming, Chestler said.

“Whether that means there’s more demand for summer it’s too soon to say,” he said.

In particular, bookings are trending upward for Coast Starlight and Southwest Chief with some growth also starting to show for the California Zephyr and Empire Builder.

Chestler said bookings are coming back “from the bottom of the bottom,” which Amtrak reached during the period of mid April to early May when it averaged 3,000 passengers a day nationwide.

Since then Amtrak ridership has doubled that, but it’s still well below what it would otherwise be at this time of year.

Some of the ridership of long-distance trains has occurred in regions where corridor trains have been suspended or reduced in frequency.

An example would be the Empire Builder between Chicago and Milwaukee where Hiawatha Service was suspended in favor of a once a day Thruway bus.

Before the pandemic, Amtrak operated seven daily roundtrips between Chicago and Milwaukee.

Chestler said Amtrak management considered continuing into the summer the reduced consists that began operating during the pandemic.

But management elected to move from what he termed “a kind of quasi-minimum” to restoring capacity for the summer.

“Had we reduced to the May levels [for the summer] we would have had a number of trains where we would have been essentially sold out already” in coach, Chestler said.

That doesn’t mean all of the seats would have been occupied because Amtrak for now is selling only half of the capacity of each coach assigned to a train in order to maintain social distancing.

“On the [Southwest] Chief and the [California] Zephyr and the [Empire] Builder there’s more sleepers [and] typically one more coach,” he said.

“We’ve balanced the use of baggage coaches and other kinds of cars to put an appropriate amount of capacity” in place “to capture demand signals from customers,” Chestler said.

Amtrak management is mindful that reducing capacity also could dampen the return of demand because the seats aren’t available.

Amtrak Averaging 4,000 Passengers Per Day

Amtrak is carrying an average of 4,000 passengers a day during the COVID-19 pandemic.

The carrier normally averages 100,000 passengers a day. About 57 percent of Amtrak’s departures have been temporarily suspended with the Northeast Corridor seeing a reduction of 77 percent of its scheduled trains.

“We are running trains where we have more staff than customers,” Amtrak CEO Richard Anderson said during an employee town hall meeting last week.

Anderson described the $1.018 billion in emergency aid it is receiving from the federal government as essential but said “we are burning about $50 million a week in cash.”

Anderson said Amtrak’s recovery from the pandemic will proceed as travel demand grows.

“We are going to be a very different railroad when we come out the other other side of this; we will be 20% smaller,” he said.

Anderson hopes that travelers understand Amtrak doesn’t pack passengers aboard its trains as densely as airlines do in their planes.

That could favor Amtrak in shorter-haul markets, he said.