Why does the Empire Builder lose so much money?

[norfolkwesternhenry]

If the Empire Builder is Amtrak's buisiest LD train, and has no more departures than the CZ, Chief, LSL, CL, and others, why does it lose more money than the rest, wouldn't it lose less because it is buisier? I need to find out to prove the newspapers wrong, that is a terrible, money losing, wreck. It is my only acces to the rest of the system.

 

[niemi24s]

[deleted]

AFAIK, your only data sources are the Amtrak monthly performance reports (such as this one https://www.amtrak.com/ccurl/322/821/Amtrak-Monthly-Performance-Report-September-2015-Preliminary-Unaudited.pdf) and NARP reports (such as this one http://www.narprail.org/our-issues/reports-and-white-papers/ridership-statistics/ ).

But indications on this forum are that the Amtrak financial data is highly distorted - and that may carry over into the NARP reports as they are supposedly based on data in the Amtrak reports. If so, perhaps the question should be whether or not the EB really loses that much money - or do the figures simply indicate that is does?

Lotsa luck with your project as I'm not really sure what can be "proved" in the scientific sense of the word.

 

[Thirdrail7]

I would surmise that since the train runs in a few sections, the associated costs for the combined trains are greater than a train of comparable distance that doesn't split/merge, like the Zephyr as an example.

 

[greatcats]

Consider this aspect : Using the Southwest Chief as an example, the labor costs really add up. In terms of operating crews, never mind on board service, I have figured that it takes about 22 or 23 engineers, conductors, and assistant conductors to get this train from Chicago to Los Angeles. As another poster notes, The EB splits into sections. If an airplane is flown Chicago to the west coast, that involves one cockpit crew. I am all in favor of the trains, but maybe someone else can make an estimate of the crew costs that I've brought up.

 

[the_traveler]

I think that may by the reason.

Example (not actual #'s): Train 5/6 earns $25 Million and costs $10 Million to operate. The profit for 5/6 is $15 Million. Train 7/8 costs $10 Million to operate, Train 27/28 costs $10 Million to operate. The EB earns $30 Million. The profit for the EB is $10 Million.

 

[neroden]

Amtrak's official numbers in their monthly "performance reports" involve the arbitrary allocation of vast amounts of "overhead" to the trains on a fairly arbitrary basis. This means.. well... it means they're bogus.

The real numbers were last reported in the bar graph on page 11 of this presentation:

https://www.amtrak.com/ccurl/778/373/Amtrak-Covers-88-Percent-of-Operating-Costs-ATK-13-022.pdf

It's a few years old now. Suffice it to say that the Empire Builder is actually the best of the trains west of the Mississippi. The East of Chicago trains do better, which is unsurprising because they have shorter routes with more cities and bigger cities.

I don't know why larger amounts of overhead are being allocated to to the EB than to some of the other trains. Ask Amtrak's accounting department. It has nothing to do with reality.

 

[afigg]

In the September, 2015 monthly report with the route performance numbers for all of FY2015, the California Zephyr had a larger fully allocated net operating loss of $62.4 million than the Empire Builder at $56.3 million. So the EB does not always have the highest net operating loss of the LD trains, the CZ and EB tend to swap rankings with the SWC not far behind in total net operating loss ($52.9 million in FY2015). In the April 2016 report, for the FY to date, the EB has the highest net loss so far, a little more than the CZ.

However, that is just the net operating loss by train. If measured by seat or passenger mile, the allocated losses are quite different. The EB and Coast Starlight have the most passengers, so the losses per passenger mile for the EB are in the middle of the LD group. Depends on how one wants to look at the loss numbers.

As to why they cost so much to operate? The Chicago to west coast trains take 2 nights and require a number of trainsets to operate. The EB normally takes 6 trainsets. That equipment requires maintenance facilities and personnel. Then, as noted above, there is the personnel cost to staff up to 5 trainsets. People don;t work 168 hours a week, 52 weeks a year. Employees take vacations & sick leave, go off for training, and don't work 7 days a week. For every staff position on a single train, it likely takes 4 to 5 employees to cover a slot. Then multiply that by 5 or maybe 6 trainsets at any given time to staff.

The 2010 to 2012 Performance Improvement Reports often broke out the expenses for each LD train. Worth looking at the financial tables in those reports (still on the Amtrak website Reports and Documents page) for those who are interested in the expense breakdown for many of the LD trains. The largest costs are the T&E employees, the On-Board Staff, maintenance of equipment (which lumps all the maintenance and equipment costs together) and fuel.

Of the Chicago to west coast LD trains, the EB may be the safest from possible cuts. The EB has strong political support in most states along its route. The LD trains that are likely the most vulnerable if Amtrak was told to kill an LD train to reduce total losses would be IMO the CZ and the Sunset Limited.

 

[Philly Amtrak Fan]

I don't know why larger amounts of overhead are being allocated to to the EB than to some of the other trains. Ask Amtrak's accounting department. It has nothing to do with reality.

Maybe if only one train serves a given station the costs to run that station are allocated to that train while the costs of a station with more trains is spread out over multiple trains. Other than CHI, the SWC has LAX with its Surfliner trains, the CZ has the Bay Area and the Capitol trains, while the EB has SEA/PDX with fewer Cascades trains.

Of the Chicago to west coast LD trains, the EB may be the safest from possible cuts. The EB has strong political support in most states along its route. The LD trains that are likely the most vulnerable if Amtrak was told to kill an LD train to reduce total losses would be IMO the CZ and the Sunset Limited.

Right because choosing trains to cut based on the financial success/popularity (or lack of) of the trains would just make too much sense.

 

[Thirdrail7]

Right because choosing trains to cut based on the financial success/popularity (or lack of) of the trains would just make too much sense.

It depends on the wildly subjective definition of "popular" and "successful." Popular with the riders? Popular with the taxpayers? Popular with connecting service? Popular with the politicians? Popular with the accountants? Popular with you? Popular with me?

 

[Eric S]

Of the Chicago to west coast LD trains, the EB may be the safest from possible cuts. The EB has strong political support in most states along its route. The LD trains that are likely the most vulnerable if Amtrak was told to kill an LD train to reduce total losses would be IMO the CZ and the Sunset Limited.

Right because choosing trains to cut based on the financial success/popularity (or lack of) of the trains would just make too much sense.

The Empire Builder has the highest ridership and least direct losses of the Chicago-West Coast trains. Seems like that's exactly what's being used here.

 

[WoodyinNYC]

The real numbers were last reported in the bar graph on page 11 of this presentation:

https://www.amtrak.com/ccurl/778/373/Amtrak-Covers-88-Percent-of-Operating-Costs-ATK-13-022.pdf

... the Empire Builder is actually the best of the trains west of the Mississippi. The Eastern trains do better, unsurprising because they have shorter routes with more and bigger cities.

The Eastern trains enjoy more benefit from sharing parts of their routes with overlapping corridor trains or other service. The state-supported corridor trains pick up most of the station cost -- tho that is not any make-or-break figure -- and probably have better upkeep of those track segments. So, the Lake Shore Ltd. shares costs with the Capitol Ltd CHI-TOL-CLE, then it shares costs with the Empire Services BUF-ALB-NYC.

The Silvers, Palmetto, Crescent, Carolinian, as well as the Amtrak Virginia trains to Norfolk, Newport News, Richmond, and Lynchburg enjoy having station and other costs split into dozens of small shares north of D.C. and down to Richmond.

Adding the Lynchburger shaved costs from the Crescent and the Cardinal, and a train to Roanoke will help there too.

But again, station costs aren't that much. The Zephyr isn't losing big bucks because it has too many stops in Utah and Nevada deserts, LOL.

The largest benefit may be the hardest to quantify: Obviously, the main benefit from state-supported corridors is the frequency of service. Customers are happier when they can chose to leave early or mid-day or later. And potential customers see passenger train running alongside the roads more often, creating a "saturation marketing" effect like you get from seeing McDonald's golden arches every few miles along the road. Each burger stand -- or each passing train -- "advertises" for the others. In those ways, and many others, the corridor trains strengthen the Amtrak brand, and give Amtrak a larger share of the potential customers' "mind space", in the jargon of the advertising and marketing types.

Sadly, the Western trains rarely get any benefits from sharing service on corridors. The Coast Starlight gets help from the Cascades and the Surfliners north of L.A. The Empire Builder also gets some glow from the Cascades service. But more healthy corridors -- like CHI-St Paul, CHI-Omaha-DEN, and L.A.-Maricopa (Phoenix)-Tucson, for example -- would greatly help Amtrak and all its LD trains.

Further to the general rule that the cure for what ails Amtrak is more Amtrak.

 

[Thirdrail7]

As to why they cost so much to operate? The Chicago to west coast trains take 2 nights and require a number of trainsets to operate. The EB normally takes 6 trainsets. That equipment requires maintenance facilities and personnel. Then, as noted above, there is the personnel cost to staff up to 5 trainsets. People don;t work 168 hours a week, 52 weeks a year. Employees take vacations & sick leave, go off for training, and don't work 7 days a week. For every staff position on a single train, it likely takes 4 to 5 employees to cover a slot. Then multiply that by 5 or maybe 6 trainsets at any given time to staff.

For the record, the Empire has operated with the 5 set rotation for quite some time. Hopefully, that 6th train set will not be needed again. That being said, adding to the cost of the Empire Builder is the set out local coach for MSP-CHI traffic. Additionally, when the train is running extremely late, they will provide alternate transportation for that leg.

I'd bet that cost is applied to the train.

 

[NW cannonball]

If the Empire Builder is Amtrak's buisiest LD train, and has no more departures than the CZ, Chief, LSL, CL, and others, why does it lose more money than the rest, wouldn't it lose less because it is buisier? I need to find out to prove the newspapers wrong, that is a terrible, money losing, wreck. It is my only acces to the rest of the system.

You got a source for that absurd assertion that the EB is biggest cash loser? would be helpful. Really

Post verifiable sources.

Consult your neighborhood cost accountant

 

[Lonestar648]

The EB was Sold Out entirely, the couple days before and after my trip SEA - CHI on the 16th. Every stop they announced that every seat would be occupied. The crew did a tremendous job staying on time despite some of the slow people getting on and off who didn't start getting ready to get off until the train arrived, then were panicked with last call. I found that the OBS crew for 7 and 8 are Seattle based, but for 27 and 28 they are Chicago based. Also, one server and one Asst. Cook on 8 detrain in Milwaukee to board 7 to work back to Seattle while the rest of the crew get about 18 hours off in Chicago. The switching in Spokane appears to be as efficient as possible. Last minute reservation are nearly impossible during the summer months.

 

[WoodyinNYC]

As to why they cost so much to operate? The Chicago to west coast trains take 2 nights and require a number of trainsets to operate ...

... the Empire Builder has operated with the 5 set rotation for quite some time. Hopefully, that 6th train set will not be needed again.

Recent Monthly Reports have shown a noticeably better performance by the California Zephyr, with an explanation about (1) adding cut-out cars Reno-Sacramento-Bay Area and (2) another sleeper added to the consists. Didn't we all wonder, What the hey? Where did they possibly find 5 or 6 more sleepers to use on the Zephyr?

You've helped to answer that good news question in my mind.

The cure for what ails Amtrak is more Amtrak. Again, if Amtrak had more equipment it would carry more passengers and lose less money. In this case, Amtrak added just one more sleeper to the Zephyr and reduced its losses.

 

[neroden]

As to why they cost so much to operate? The Chicago to west coast trains take 2 nights and require a number of trainsets to operate ...

... the Empire Builder has operated with the 5 set rotation for quite some time. Hopefully, that 6th train set will not be needed again.

Recent Monthly Reports have shown a noticeably better performance by the California Zephyr, with an explanation about (1) adding cut-out cars Reno-Sacramento-Bay Area and (2) another sleeper added to the consists. Didn't we all wonder, What the hey? Where did they possibly find 5 or 6 more sleepers to use on the Zephyr?
You've helped to answer that good news question in my mind.

The cure for what ails Amtrak is more Amtrak. Again, if Amtrak had more equipment it would carry more passengers and lose less money. In this case, Amtrak added just one more sleeper to the Zephyr and reduced its losses.

'
..and they could use more. I just started trying to plan my trip to the Gathering and discovered that the sleepers are practically sold out for my day of travel. Only the Family Bedroom left.

 

[afigg]

You got a source for that absurd assertion that the EB is biggest cash loser? would be helpful. Really

Post verifiable sources.

Consult your neighborhood cost accountant

The official total revenue and cost numbers for each train service are available in the Route Performance Tables in section C provided in each monthly report which are posted to the Amtrak website.

Link to the September, 2015 Monthly Performance Report (63 page PDF text file) with the numbers for FY2015.

Link to the April, 2016 MPR with the accumulated numbers for October 2015 through April 2016.

From the viewpoint of total net operating loss, for FY2015, the EB has the second largest fully allocated loss (adding in all overhead) of $56.3 million while the CZ had a larger total operating loss of $62.4 million. From a bottom line viewpoint, those are the net losses that had to be covered by the operating subsidy provided by Congress and the operating surplus from the NEC. For the first 7 months of FY2016, according to the April report, the EB has a slightly larger allocated loss at $38.7 million than the CZ at $36.3 million. These trains cost money to operate. Better OTP for the EB should help grow ridership and revenue over time.

 

[norfolkwesternhenry]

Consider this aspect : Using the Southwest Chief as an example, the labor costs really add up. In terms of operating crews, never mind on board service, I have figured that it takes about 22 or 23 engineers, conductors, and assistant conductors to get this train from Chicago to Los Angeles. As another poster notes, The EB splits into sections. If an airplane is flown Chicago to the west coast, that involves one cockpit crew. I am all in favor of the trains, but maybe someone else can make an estimate of the crew costs that I've brought up.

where do you get 22 engineers?? That would mean switching them every two hours, when they can work up to twelve hours a day? 46/12 is about 4, probably 5-7, because they would be stuck if they were delayed, so they shorten the shifts.

 

[CCC1007]

Consider this aspect : Using the Southwest Chief as an example, the labor costs really add up. In terms of operating crews, never mind on board service, I have figured that it takes about 22 or 23 engineers, conductors, and assistant conductors to get this train from Chicago to Los Angeles. As another poster notes, The EB splits into sections. If an airplane is flown Chicago to the west coast, that involves one cockpit crew. I am all in favor of the trains, but maybe someone else can make an estimate of the crew costs that I've brought up.

where do you get 22 engineers?? That would mean switching them every two hours, when they can work up to twelve hours a day? 46/12 is about 4, probably 5-7, because they would be stuck if they were delayed, so they shorten the shifts.

The crew is 2-3 people, engineer, conductor and (optional?) assistant conductor.

 

[zephyr17]

Consider this aspect : Using the Southwest Chief as an example, the labor costs really add up. In terms of operating crews, never mind on board service, I have figured that it takes about 22 or 23 engineers, conductors, and assistant conductors to get this train from Chicago to Los Angeles. As another poster notes, The EB splits into sections. If an airplane is flown Chicago to the west coast, that involves one cockpit crew. I am all in favor of the trains, but maybe someone else can make an estimate of the crew costs that I've brought up.

where do you get 22 engineers?? That would mean switching them every two hours, when they can work up to twelve hours a day? 46/12 is about 4, probably 5-7, because they would be stuck if they were delayed, so they shorten the shifts.

The crew is 2-3 people, engineer, conductor and (optional?) assistant conductor.

That is at any one time. On the Southwest Chief, the crew change points are Kingman, Albuquerque, La Junta, Kansas City, and Ft. Madison. I think the union contract requires 2 engineers in the cab for any run scheduled over 6.5 hours, and the engine crew change points can be slightly different because of that since Amtrak would prefer only one engineer. I know there are some different crew change points on the Empire Builder because of that, but I am not sure about the Southwest Chief. Assuming conductors and engineers do have the same crew change points, then:

LA-Kingman 2 engineers

Kingman-Albuquerque 2 engineers

Albuquerque-La Junta 2 engineers

La Junta-Kansas City 2 engineers

Kansas City-Ft. Madision 1 engineer

Ft. Madison-Chicago 1 engineer

That is 10 engineers, and assuming a conductor and an AC, 12 conductors. So yes, that is 22 T&E crew members to get the train from LA to Chicago. If Ft. Madison is a engineer only crew change point and it could be since the running time between KC and Chicago is only 7 hours and 47 minutes, that makes 10 conductors for a total of 20 T&E crew for the trip.

The crew home terminals are LA, Albuquerque, KC and Chicago, IIRC.

 

[BCL]

If the Empire Builder is Amtrak's buisiest LD train, and has no more departures than the CZ, Chief, LSL, CL, and others, why does it lose more money than the rest, wouldn't it lose less because it is buisier? I need to find out to prove the newspapers wrong, that is a terrible, money losing, wreck. It is my only acces to the rest of the system.

The Coast Starlight is Amtrak's busiest LD train.

 

[tommylicious]

the fatcat pension costs sink the profitability

 

[greatcats]

There is a short crew district La Junta to Dodge City that is operated normally operated as an overnight turn. The other poster gave pretty accurate information, so I think our estimate of 22 or 23 crew members is correct.

 

[WoodyinNYC]

There is a short crew district La Junta to Dodge City that is operated normally operated as an overnight turn. The other poster gave pretty accurate information, so I think our estimate of 22 or 23 crew members is correct.

Did you mean to post this comment in the

Southwest Chief-Pueblo updatethread? I can't make sense of it here.

 

[greatcats]

No, I am referring to the Southwest Chief as the crews, as far as I know, are currently configured.