Remember the glamorous days of train travel? Like the 20th Century Limited connecting New York and Chicago? In 1928, the popular 20th Century Limited exemplified the profitability of passenger rail. Yet, times have changed, and America’s passenger trains have lost money since 1946. With the invention of air conditioning, travel habits shifted to favor north-south routes.
For example, Amtrak’s east-west routes lost over $560 million in FY2024 alone. This contrasts with the Auto Train (Virginia to Florida), which generated a profit of $6.6 million. Fewer people are riding east-west trains (passenger-miles are down 22 percent since 2011). In contrast, north-south routes have seen an 8 percent bump.
Airlines are seeing the same trend: New York to Miami is booming, while New York to Los Angeles is losing steam. In the fourth quarter of 2023, the New York to Miami route saw 25,263 daily passengers—a 13 percent increase from 2019. Meanwhile, the New York to Los Angeles route saw only 13,213 daily passengers—a 10 percent drop. …
Another common argument is that highways and airports are bursting at the seams. This implies that we “need” trains to relieve pressure. Yet, United Airlines is limiting its growth to match supply with demand. If Amtrak had done this, it wouldn’t be selling tickets for $5 from Washington to Baltimore. Even at these rock-bottom prices, 47 percent of Amtrak’s seats are empty.
Amtrak says that rail “privatization” in the UK didn’t work. Politicians were still designing routes, even though private companies were operating the trains. These big companies pocketed taxpayer money in the form of infrastructure subsidies. For this reason, the UK is now switching back to government operation of train services.
Instead of this, Congress should cut Amtrak’s capital and operating subsidies to zero. Once Amtrak isn’t relying on subsidies, it can focus on the routes that could actually make money. Brightline Florida—a privately-owned train service—began operations in 2023. Rocky Mountaineer offers amazing train trips through the Rockies without taxpayer subsidies. If Amtrak can’t figure out how to operate trains without subsidies, then someone else will.
I have to agree with the author on this point, with subsidies, Amtrak will never be profitable. The politicians and their political means are putting their fingers in the pie and ruining it. They ruin it with the subsidies and demanding routes that will never pay but are really hot for getting publicity and name recognition for the politician while the taxpayers pay and pay and pay. Without subsidies, the company can run itself in the way that best generates profits and thus efficiency, however the empty trains will not run where they are running. So, stopping subsidies perhaps in all areas would free up money for more high priority uses.