Amtrak Executives Say Attrition, Not Furloughs Led to Shortage of Mechanical Workers

Amtrak CEO Stephen Gardner and Board Chairman Anthony Coscia pushed back last week on the assertion that furloughs during the COVID-19 pandemic are responsibility for shortages of mechanical workers at the passenger carrier.

During a public meeting last Thursday in St. Louis of the Amtrak board of directors, both took issue with an assertion by Rail Passengers Association head Jim Mathews that “choices surrounding furloughs and equipment have left Amtrak struggling to accommodate demand surges – both on specific routes and over travel periods, such as Thanksgiving.”

Coscia acknowledged that Amtrak lacks adequate equipment and personnel to “bring back service the way we’d like to.”

Gardner said attrition and not furloughs are the reason for the thin workforce in Amtrak’s mechanical department.

“That’s not true, that’s not what happened,” Gardner said in response to Mathews. “What did happen was that during this period of time [the pandemic] when we could not hire we could not overcome the attrition. So last year we hired 3,600 people or so, but we also lost 1,600 people during that same period to retirements, to a change in job, [and] to relocations” and other reasons.

Gardner said about 90 percent of workers who were furloughed by Amtrak during the pandemic have since returned to their jobs.

Coscia said Amtrak is trying to rebuild a workforce “that had kind of atrophied to a certain degree.”

The question arose during a discussion about how Amtrak has a backlog of equipment idling in shops instead of being placed back into revenue service due to a lack of mechanical staff to bring those cars into operating condition.

Gardner said hiring electricians and machinists is tough to do in some locations, but Amtrak is working with its unions to find new ways to hire and train new workers. One such program is a new apprenticeship program for entry-level jobs.

“We’re working every angle to be able to restore people that make the trains available to serve our customers . . . [and] restore service and then grow,” Gardner said.

Amtrak is seeking to hire an additional 4,000 new employees in 2023, most of whom would work in the mechanical crafts where the need is most acutely felt.

Nonetheless, Amtrak management still expects to fall short of reaching full staffing by the end of the federal fiscal year on Sept. 30, 2025.

The passenger carrier expects capacity on its trains to be less than it was four years ago and forecasts it will carry 28 million passengers in fiscal year 2024, which would be 90 percent of 2019 levels.

Amtrak expects to restore capacity to pre-pandemic levels in FY2024, which begins Oct. 1, 2024. It also expects ridership during FY2025 to exceed that of 2019.

Amtrak Lost $801M in FY2020

Amtrak warned yet again on Monday that further service cuts are possible unless Congress increases its federal funding for the passenger carrier in fiscal year 2021.

Funding for Amtrak and other federally-funded programs is currently being provided under a continuing resolution approved by Congress in late September that expires on Dec. 11.

That resolution calls for interim funding in FY2021 to be at the same levels as FY2020, which ended on Sept. 30.

“If the current level of funding is extended in a continuing resolution beyond Dec. 11 . . . and supplemental funding isn’t provided we’re going to be unable to avoid taking fairly difficult actions that could have long-lasting effects on our Northeast Corridor infrastructure and the national rail system,” said Amtrak CEO William Flynn.

Flynn said the carrier needs additional emergency funding for the remainder of the fiscal year.

If Amtrak funding continues at its current levels, Flynn said as many as 1,600 workers operating state-supported trains could be furloughed.

Amtrak Senior Executive Vice President Stephen Gardner said decisions on job and service cuts will be made based on how long the uncertainty remains.

In a news release, Amtrak said during FY2020 its operating revenue, including payments from state-supported routes, decreased 31.9 percent to $2.3 billion when compared with FY 2019.

Ticket revenue was down $1.24 billion or 47.3 percent.

During FY2020 Amtrak posted an unaudited operating loss of $801.1 million, which it attributed largely to lost ridership during the pandemic.

The carrier also reported advancing $1.9 billion in infrastructure and fleet work.

Amtrak Board Chairman Anthony Coscia said the passenger carrier projects that under current trends and future projections, ridership and revenue are expected to be down 63 percent by the end of fiscal 2021.

That would be worse than the 50 percent decline Amtrak management had predicted earlier when it announced its plans to reduce the operating frequency of most long-distance trains to tri-weekly.

Coscia said Amtrak intends to move forward on $2 billion in critical infrastructure work “that includes safety and reliability measures that we believe will permit the company to come through the pandemic with a railroad that was playing and will play in the nation’s economic recovery.”

He said Amtrak has more than $5 billion of additional investments that could contribute to recovery following the pandemic.

Amtrak said it provided 16.8 million customer trips in FY 2020, down 47.4 percent with a year-over-year decline of 15.2 million riders.

In recent months, ridership has dipped by 20 to 25 percent of pre-COVID levels.

Amtrak Looking Toward Post Pandemic World

Amtrak management is studying a number of scenarios for ramping service back up once the COVID-19 pandemic has passed.

In the meantime, though, the passenger carrier expects to lose $700 million in adjusted operating earnings as a result of the pandemic.

Amtrak Chairman Anthony Coscia along with new CEO William Flynn and Executive Vice President Stephen Gardner gave those assessments during a conference call with news reporters.

Amtrak ridership across its system has fallen by 95 percent and it has suspended 57 percent of its services.

Amtrak is receiving $1 billion in emergency federal aid and Coscia said that assistance will enable Amtrak to avoid having to tap its capital reserves and avoid employee layoffs.

He said that before the pandemic began Amtrak was “on track” to break even in operating earnings by Fiscal Year 2021 for the first time in the railroad’s history.

That figure counts as revenue funding that Amtrak receives from various state governments to operate corridor service.

Flynn said the carrier has been taking advantage of the lower ridership period to perform track work and other “critical” projects.

In looking to the future, Flynn said Amtrak officials are studying touchless technology at fare gates and changing some food service.

One idea being explored is enabling passengers to pre-order food and beverages from café cars.

Flynn said Amtrak expects it will take three months or more for ridership to return to pre-pandemic levels.

It is not clear when that clock would start. Some governors have been talking in recent days about easing social distancing restrictions on or after May 1, although some forms of social distancing are expected to remain in place either by mandate or recommendation.

Flynn said Amtrak has been researching various ideas of what the pandemic recovery will look like and have created several service plans based on “surveys of customer sentiment.”

In some instances, Flynn indicated, Amtrak will “introduce product ahead of demand.”

“We have to demonstrate to our customers that we have an attractive product that they will value when they come back,” Flynn said.

Gardner said Amtrak is looking at implementing new ticketing kiosks and text messaging to inform passengers where to head once they arrive at their station.

The downloadable schedules that have been removed from the Amtrak website will be reintroduced once services are restored.

Flynn said none of Amtrak’s unions have thus far shown an interest in delaying or giving up negotiated wage increases.

“But we continue to work with union leadership so they understand where we are in this crisis and how we are going to move forward,” he said.

Trains magazine reported that Amtrak spokesman Marc Magliari said 58 percent of onboard service employees are on an extra board that guarantees them 150 hours per month of work.

Regularly assigned employees are guaranteed a 180-hour month, so their pay cut works out to about 16 percent.

“Engineers and conductors have a 40-hour-a-week guarantee, but many of them previously worked assignments that included overtime, which has been reduced,” Magliari said.

Anderson Might be Leaving Amtrak in 2020

Buried in a recent Wall Street Journal article about the challenges that Amtrak faces in 2020 was for some a potential bit of good news.

The president and CEO that many rail passenger advocates love to hate, Richard Anderson, may be leaving the company this year.

The article said Anderson’s potential departure is among the challenges Amtrak is facing this year.

Although no details were provided in the Journal article, Anderson is reported to have a three-year contract that expires this year.

Anderson, 64, a former Delta Air Lines CEO, came to Amtrak in June 2017 and for several months served as co-CEO along with the now retired Charles “Wick” Moorman.

Amtrak Chairman Anthony Coscia would not comment to the Journal about Anderson’s potential departure other than to say the passengers carrier “takes succession planning very seriously, and its ability to attract world-class CEOs also brings with it the responsibility to assure there’s continued leadership at that level.”

Whether Anderson continues to lead Amtrak through and past 2020 may not matter if the carrier continues on its current path of emphasizing the pursuit of profitability or at least break-even operation.

Amtrak has touted its fiscal year 2019 operating loss of $29.8 million as the best financial performance in Amtrak’s nearly 50-year history.

Anderson has repeatedly spoke of breaking even in 2020, although it should be noted Amtrak counts its federal funding as revenue.

The Journal article noted that some members of Congress have been critical of Amtrak’s financial strategies, saying the carrier’s overall service has suffered.

Although Anderson doesn’t give many interviews, in those that he has, including with the Journal, he has spoken about shoring up Amtrak finances as a way to gain credibility in Congress so it can ask for and receive millions if not billions of new money for capital projects, including replacement of aging tunnels and other infrastructure in the Northeast Corridor.

Amtrak’s future will be a major topic of conversation in Washington this year because Congress may act on a new multiyear highway bill that is expected to include reauthorization of the federal grant programs that fund Amtrak.

The reauthorization, which would replace the current FAST Act, may contain policy directives that govern Amtrak’s operations.

The FAST Act expires in 2020. It is a five-year surface transportation law that funds road, rail and transit programs.

The Journal article noted that some Capitol Hill observes are skeptical that Congress will be able to agree on a new transportation bill during a presidential election year.

They base that on the reality that raising the gasoline tax will be part of that discussion and many lawmakers are loath to do that.

The federal gasoline tax funds most highway construction and has not increased since 1993.

Anderson and senior vice president Stephen Gardner, who may be Anderson’s replacement if he steps down, have articulated a vision in which Amtrak downgrades long-distance routes in favor of shorter corridor services between major population centers.

Although Anderson has spoken about retaining some long-distance routes as experiential services, he has also indicated that the passenger carrier may seek congressional approval this year to experiment with restructuring at least one long-distance route.

In an interview with the Journal, Amtrak Chairman Coscia sought to frame the changes Amtrak is eyeing as a way to provide better service to underserved regions.

“What we’re after here is the person who lives in Atlanta or Charlotte, who doesn’t have train service,” Mr. Coscia said. “The person who has to wake up at 3 in the morning in Cleveland to take a train.”

Amtrak management has yet to formally release a plan for doing that although Anderson has hinted that in advance of congressional action on a new Amtrak authorization the passenger carrier will release more specific details about its plans.

Amtrak Committed to Long-Distance Trains for Now, But Not Necessarily Forever

Amtrak has indicated to lawmakers and the Rail Passengers Association that it is not planning additional actions that would have the effect of changing its long-distance routes in ways to favor shorter distance travel.

Writing on the RPA website, RPA President Jim Mathews said that “Amtrak is taking steps to commit publicly to a robust nationwide rail service with a national footprint.”

He said those assurances have been made by the passenger carrier in conversations with the RPA and congressional staff, and during congressional testimony.

Matthews cited the example of reports that the Chicago-Seattle/Portland Empire Builder would be made into a tri-weekly train as part of a strategy to focus on short-haul corridors.

Many passenger advocates have been alarmed by some recent Amtrak changes, including removing full-service dining with fresh meals prepared on board from the Capitol Limited and Lake Shore Limited effective June 1.

Amtrak CEO Richard Anderson said during an April 19 California Rail Summit that the future of Amtrak lies with 300- to 400- or 500-mile corridors.

RPA has also learned that Amtrak management has begun discussing the long-term future of the carrier’s long-distance routes and that some Amtrak executives are discussing the possibility of allocating more resources to short-distance state corridors. It is not clear how far those discussions have advanced.

Matthews said Senator Steve Daines (R-Montana) asked Amtrak Chief Commercial Officer Stephen Gardner point-blank whether there were plans to reduce the Builder.

“We do not plan to institute tri-weekly service on the Empire Builder,” Gardner replied during a committee hearing on May 16. “Obviously we’re operating under the FAST Act authorization in which Congress authorized our network; any conversations about the broad future of our network is best placed in our authorization context as we approach our next authorization. Amtrak is operating all of our long distance routes, we intend to do that and we will consider any future changes collectively between the Congress, the Administration, and Amtrak as we look at the network ahead.”

Matthews noted that he visited with Amtrak Chairman Anthony Coscia earlier this year and received similar assurances.

Coscia said during that meeting that Amtrak has a mission beyond the balance sheet and pledged that top management is “committed to the mission.”

He also said that Amtrak has a responsibility as a recipient of federal funds to make sure that its long-range plans serve the maximum number of Americans possible, especially those who need mobility and have fewer options, such as the elderly, the disabled and rural residents.

However, Coscia said that demographic shifts that are leading more people to live in dense mega-regions may result in a time when the “legacy national network routes no longer meet the mission; but looking at the map today I can’t identify any that don’t.”

Coscia said Amtrak sees “corridors hanging off the legacy national network routes like a necklace.”

He cited as examples Chicago-St. Louis and Chicago-Minneapolis as having strong growth potential.

During his April appearance in California, Anderson said “there is a place for the long-distance, ‘experiential’ train.”

Anderson said Amtrak has “a responsibility to figure out how to keep that experiential piece of the pie in place” while simultaneously “figuring out how we discharge our mission under PRIIA”—the Passenger Rail Investment and Improvement Act of 2008—“to serve the short-haul markets.