Q. The Texas Eagle consistently operated at sold-out or near sold-out conditions during much of 1995, with healthy load factors (percentage of occupancy) during the remainder of the year. The same statement is accurate for the Texas Eagle operation thus far in 1996, yet ridership figures show a significant decline when compared to the previous year. WHY?
A. Until mid-September 1995 (when a Dallas-Houston segment was discontinued), the Eagle operated with a standard consist of five to six coaches, in addition to two sleeping cars and a dining and lounge car. This provided an inventory of 370 seats (with 5 coaches) which were available for sale. After the Houston segment was discontinued, Amtrak management shifted equipment from the Eagle to other routes where they wished to replace older equipment with the newer Superliner cars. Since that time, the Eagle has been arbitrarily limited by Amtrak management to only three coaches with the same sleeping and dining car equipment. This decision reduced the space inventory on the Eagle from 370 seats to 226 seats. Even when the train is running sold-out, as it has been doing most of this summer, ridership will show a decline when compared to last year because insufficient equipment is being operated to meet the travel demand.
Q. Is the Texas Eagle burdened with any additional costs which are not normally incurred by other Amtrak passenger train routes?
A. Yes. Because this train operates only tri-weekly, train operating crews between Little Rock and St. Louis are routinely flown at Amtrak expense between their destination terminal and their home terminal, in order to avoid an even larger expense of paying crew members for layovers of up to 67 hours away from their home terminal. [As an example, northbound train #22 arrives in St. Louis at 6:20am Wednesday morning; the returning train, southbound #21, does not leave St. Louis until 1:00am Saturday morning.] A similar inefficient and expensive "deadheading" policy is required for crews operating between Fort Worth and San Antonio because of the same extensive layover problem. In addition to the train crew costs, Amtrak incurs extra expense with the on-board service crews (car attendants, dining and lounge car staff). Amtrak incurs yet another expense by trucking mail to Fort Worth four days each week on the days when the train does not operate, in order to comply with a U.S. Postal Service contract for daily mail transportation between Chicago-Fort Worth. Unnecessary expenses of this nature could be immediately resolved by operating the train on a daily basis, and unnecessary crew deadheading costs could be largely eliminated with even a quad-weekly frequency.
Q. What about tri-weekly train frequencies... the Eagle has been operated only tri-weekly for most of the time since the route was inaugurated in March 1974.
A. Amtrak management prior to the administration of President Thomas Downs recognized that service on a less than daily basis was unsatisfactory, and tri-weekly frequencies were utilized only when dictated by equipment or funding limitations. President Downs, however, implemented a policy of less than daily service on many long-distance routes last year. As part of the present proposal to discontinue the Texas Eagle, Amtrak Intercity President Mark Cane belatedly announced that the corporation's effort to operate trains on a less than daily frequency was a failure. Expenses increased and revenues declined because less than daily schedules do not meet the travel need of many prospective passengers. Given Amtrak's dismal experience with tri-weekly service on other routes, the corporation should have considered the devastating revenue impact of years of tri-weekly operation on the Eagle rather than simply opting to discontinue the train. All other trains that were reduced to less than daily service last year will be restored to daily operation on November 10, as Amtrak struggles to correct their massive scheduling blunder.
Q. An Amtrak internal memo from Intercity President Mark Cane states that "...the Eagle has failed, even after an aggressive marketing campaign." What marketing or advertising programs has Amtrak actually undertaken to boost ridership on the Eagle route?
A. None whatsoever. The only route-specific marketing programs (advertising which specifically identifies the route, the points it serves, and fares) have been several small programs which were entirely paid for, not by Amtrak, but by local passenger train advocates or the personal funds of Amtrak station employees at various locations. A very limited amount of "generic" Amtrak radio advertising has been used on a sporadic basis; this advertising admonishes the listener to "ride Amtrak" but fails to identify trip opportunities for the specific route or region where the listener resides. Particularly in the case of the Texas Eagle, many prospective passengers are unaware that their city is even served by passenger trains. Incredibly, Amtrak has funded a huge one-half page newspaper advertising program to defend their decision to discontinue service. This one nonproductive advertisement, placed in all on-route newspapers, cost more than Amtrak's total route advertising expenditures for the Eagle for the last decade.
Q. Amtrak management claims that discontinuance of the Texas Eagle is necessary because of poor performance and the lack of "growth potential along the route." Is Amtrak telling the public, or the Congress, the full story?
A. Amtrak's explanation for discontinuing the Texas Eagle conveniently ignores numerous factors which, if considered, would have resulted in a decision to maintain service. The most significant of these factors have been mentioned above. Insofar as the growth potential for this train or this region is concerned, suffice to say that Amtrak management's version is totally at odds with conventional wisdom. Both Arkansas and Texas continue to enjoy economic growth and an increasing population base, neither of which would be expected in a "no growth potential" scenario. In both states, tourism is a major industry, and indeed a growth industry. The Texas Eagle presently serves Chicago, St. Louis, Little Rock, Dallas, Fort Worth, Houston (via connecting bus), Austin, and San Antonio. Amtrak has concluded that economically viable rail service cannot be provided between these population centers.
By comparison, Amtrak is expanding service on the Empire Builder from quad-weekly to daily at the same time that discontinuance is proposed for the Texas Eagle. The Empire Builder serves Chicago and Minneapolis, but other major intermediate cities along this route include Fargo and Minot, North Dakota, along with Wolf Point and Whitefish, Montana, before the train reaches its Seattle destination. It seems highly illogical that daily service is economically viable on a route with extremely sparse intermediate population, while Amtrak cannot provide even tri-weekly service along the much heavier intermediate population points on the Eagle route. [Amtrak is to be applauded for finally restoring the Empire Builder to a daily frequency; the point is that if Amtrak can operate the Empire Builder at a financially viable level given that route's minimal population and harsh operating environment, the corporation could certainly do the same with the Texas Eagle.]
Q. What about the alleged shortfall of Amtrak operating subsidy which is presently before a congressional conference committee?
A. Amtrak requested operating funding of $250 million; both the House of Representatives and the Senate provided $200 million. Amtrak has previously claimed that all trains lose money, including the highly touted but extremely cost inefficient Northeast Corridor service. In order to reduce funding requirements, Amtrak has historically reduced train miles. In this particular case, Amtrak is merely shifting train miles, discontinuing the Texas Eagle and several other targeted trains, but adding train miles with a new (third daily) New York- Florida train and daily service on most existing tri-weekly or quad-weekly trains. It is admirable that Amtrak has belatedly realized that trains must run daily to succeed, but this realization must not be accomplished at the expense of the Texas Eagle. Amtrak's total train miles will actually increase as a result of the changes proposed for November 10, and this fact greatly diminishes the credibility of Amtrak's claim that a funding shortfall precipitated these train discontinuances.
Q. Amtrak has been accused of making business and route decisions based on faulty data involving nothing more than crude system averages of revenues and expenditures which often bear little resemblance to the true revenue and expense picture for a given route. The use of this questionable data results in erroneous decisions, such as the proposed discontinuance of the Texas Eagle. Are examples of Amtrak's faulty accounting system readily available?
A. This question is best answered by posing a series of questions to Amtrak management. There is little doubt that a large part of Amtrak's expense and revenue allocation to various routes is badly flawed. To illustrate this point, the following questions could be asked of top Amtrak management (although a response of evasion rather than definitive answers would be forthcoming). These questions are examples of poor accounting practices which lead to bad decisions; they should be viewed as merely the tip of the iceberg of defects within Amtrak's present in-house data management system.
Prepared for Arkansas Rail by Bill
Pollard. Email: arkrail@aol.com
Posted: Monday, 2 September 1996.
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