amtrak 2011 update stephen gardner, vice president, policy and development aashto meeting, march 4,...
TRANSCRIPT
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Amtrak 2011 Update
Stephen Gardner, Vice President, Policy and Development
AASHTO Meeting, March 4, 2011
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Amtrak 101 – basic company and system statistics
• Congressionally chartered corporation
• Amtrak mission: “provide efficient and effective intercity passenger rail mobility consisting of high quality service that is trip-time competitive with other intercity travel options”
• System basics:
– 21,100 mile system, 20,000 employees
– 308 daily intercity trains, 528 stations
• Record Ridership: – 28.7 million riders in FY 10
– 4 of last 5 years have been records
– 37% growth since 2000
• Record revenue of $2.5 billion in FY 10
– Covered 85% of operating cost
– Our FY 10 farebox recovery was 76% - highest recovery in US
• Federal funding for Amtrak was $1.5 billion in FY 2010:– Roughly $1 billion for capital, debt, ADA
– $563 million for operating support
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The Amtrak system
Cascades
Californiacorridors
Chicago Hub
NortheastCorridor
(NEC)
Long distance routesconnect major hubsand corridor services
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Business lines – what we do, and why we do it
• NEC - high-yield, short distance travelers
– Financial Engine
– Business Travelers- Acela 80%+- Northeast Regional 35%+
• Long Distance - high-value sleeper travelers, shorter haul coach markets
– Network Connectivity
– Foundation for Future Growth
– Underserved Areas, Federal Operating Subsidy
• State Corridors - high-volume, low-yield short distance travelers
– Feeders to Other Services
– State Supported
• Commuters – revenue opportunities, economies of scale
– For profit, contractual basis
– Expand system connectivity
• Commercial Development – maximize revenue opportunities inherent in the property
– Includes stations, advertising opportunities, utilities, etc.
Avg. Ticket Revenue / Rider
Amtrak Total $60NEC Spine $86
Acela $136NER $64
State Corridors $28Long Distance $99
Sleeper $240Coach $74
Ridership (millions)
FY 10 FY 09 chg
Amtrak Total 28.7 27.1 5%
NEC Spine 10.3 9.9 4%
Acela 3.2 3 6%
NER 7.1 6.9 3%
Short Distance 13.8 13 6%
Long Distance 4.4 4.2 6%
Ticket Revenues (millions)
FY 10 FY 09 chg
Amtrak Total $1,742 $1,599 9%
NCE Spine $899 $841 7%
Acela $440 $409 7%
NER $458 $431 6%
Short Distance $390 $346 12%
Long Distance $453 $411 10%
Federal Gov’t
States
Federal Gov’t
State PartnersCom
muter
AuthoritiesM
unicipaties,
tenantsli
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Ticket Revenue by Business Line
Long Distance, $446m,
26%
Acela, $435m,
25%
Northeast Regional, $458m,
26%
State Corridors, $390m,
23%
Ticket Revenue by Business Line
Long Distance, $446m,
26%
Acela, $435m,
25%
Northeast Regional, $458m,
26%
State Corridors, $390m,
23%
FY10 Revenue and Ridership Breakdown
• NEC makes up over half of Amtrak revenue and requires most of Amtrak capital funding
• State Corridors make up nearly half of Amtrak ridership
• Long Distance trains require bulk of Federal operating subsidy
NEC
Ridership by Business Line
Northeast Regional,
7.2m, 25%
Acela, 3.2m, 11%
State Corridors,
13.8m, 48%
Long Distance,
4.5m, 16%
Ridership by Business Line
Northeast Regional,
7.2m, 25%
Acela, 3.2m, 11%
State Corridors,
13.8m, 48%
Long Distance,
4.5m, 16%
NEC
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The near-term funding situation
• Amtrak and HSIPR grants:
– FY 11: - House-passed CR cut Amtrak to $1.413B – slightly more than FY 08 – and eliminates HSIPR funding
- Sessions amendment to further cut to $966 million defeated on bipartisan vote
– FY 12:- Amtrak requested $2.2B – right around the authorized funding level- Detailed discussion on this budget won’t start for some time – but will be protracted.
- Lower baselines make increases harder
• Surface Transportation Reauthorization:- Administration proposes merging Amtrak/HSIPR into new consolidated rail program:- $4 billion for System Preservation (initially Amtrak)- $4 billion for Network Development (competitive)
- Hinges on ability to raise revenues
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FY10 Intercity Travel Market
• US travel market has been shrinking due to recession and high unemployment:
– Amtrak is growing
– US Outlook- Leisure travel - modest growth (~50% of Amtrak ridership)
- Business Travel – flat (~46% of Amtrak ridership)
• Amtrak market share strongest in high frequency markets, mainly in NEC and West
• Near-term growth through increasing rail market share:
– Southeast corridors
– California corridors
– Chicago – Midwest
----------------------Market Shares----------------------------National-------- ---Northeast Corridor---2009 2011 2009 2011
% % % %
Amtrak 1.7 2.0 16.0 22.0Car 67.0 69.0 69.0 58.0Air 29.0 27.0 9.0 12.0Bus 2.0 2.0 6.0 7.0
----------------------Market Shares----------------------------National-------- ---Northeast Corridor---2009 2011 2009 2011
% % % %
Amtrak 1.7 2.0 16.0 22.0Car 67.0 69.0 69.0 58.0Air 29.0 27.0 9.0 12.0Bus 2.0 2.0 6.0 7.0
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NEC Spine On-Time Performance
0.0%10.0%20.0%30.0%40.0%50.0%60.0%70.0%80.0%90.0%
100.0%
FY 06 FY 07 FY 08 FY 09 FY 10
NEC Spine On-Time Performance
0.0%10.0%20.0%30.0%40.0%50.0%60.0%70.0%80.0%90.0%
100.0%
FY 06 FY 07 FY 08 FY 09 FY 10
Key Ridership Drivers – Fast, Frequent, Reliable, and Comfortable
• “Hard” service improvements
– On-time performance
– Faster trip times
– Frequency of service (departures)
– Information and access
• “Soft” service improvements
– On-board amenities/service
– Station and equipment design features/elements consistent with customer expectations
– Comfort, convenience
– Personal space
– Productivity support, business amenities (especially Acela)
NEC Spine Customer Satisfaction Index
64%
66%
68%
70%
72%
74%
76%
78%
80%
FY 04 FY 05 FY 06 FY 07 FY 08 FY 09 FY 10
NEC Spine Customer Satisfaction Index
64%
66%
68%
70%
72%
74%
76%
78%
80%
FY 04 FY 05 FY 06 FY 07 FY 08 FY 09 FY 10
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• Amtrak is now the dominant provider in the NEC
– Frequency, competitive trip times, OTP drive share shift
• Acela product quality also critical to increased share
– Wi-Fi, Leather seats, quality of customer experience
– Improved Food and Beverage service
– En route cleaning, customer service focus
Fast/Frequent Service Induces Modal Shift – NEC
FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10
DC-NY 36% 37% 45% 56% 50% 50% 51% 55% 56% 63% 61% 69%
NY-Boston 18% 20% 27% 41% 35% 39% 38% 36% 41% 49% 50% 53%
Daily Round Trips
New York - Washington 36New York - Philadelphia 46New York - Boston 19
0%
10%
20%
30%
40%
50%
60%
70%
80%
Trends in Amtrak Share of Air-Rail Market
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Why do we need passenger rail?
• Competing modes are congested, and getting worse:
– Number of urban areas with more than 20 hours of annual rush hour traffic delay increased sevenfold between 1982 and 2007
– Between 2000 and 2008, number of flight delays due to airport terminal volume increased by 42%
• Rail’s niche is the sub-500 mile intercity market:
– More than 79% of total trips USDOT classifies as ‘long distance’ (50+ miles) fall into this category
– Number of Americans living in urban areas expected to double (150M to 300M) by 2050
100 100 100 98 97 8870 66 61 50
170%
10%20%30%40%50%60%70%80%90%
100%
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Top ten corridors – Air-rail share, FY 09
Where we can offer reliable andtrip-time competitive service,Amtrak thrives – and demonstrates the latent and growing demand for intercity passenger service
Where we can offer reliable andtrip-time competitive service,Amtrak thrives – and demonstrates the latent and growing demand for intercity passenger service
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The rail network must evolve to address these needs
• Rail – including HSR – needs to be part of the solution
• Rail solutions must:
– Match speed and operating characteristics to market demand - Auto? Air? Both?
– have connectivity – other modes must feed nodes
– Tailor investment to address the mobility challenges, particularly in places like:- California- Northeast- Florida- Chicago area
HSRExpress
(150+ mph)
HSRRegional
(110-150+ mph)
Emerging HSR(90-110 mph)
ConventionalRail
(up to 90mph)
CommuterRail
Light/Heavy Rail
Auto and Bus Peds andother transit
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State Partnerships…
• States are vital partners for Amtrak and together, we form a cooperative system
• States provide:- Service initiatives and planning - operating funds - $191 million annually, or 23% of total costs. With revenues and state payments, 76% of fully allocated costs
- Capital investments (stations, equipment, etc)- Intermodal integration- Service focus and innovation
• Amtrak provides:- ~25% of fully-allocated costs of all corridor services- Railroad access- Liability arrangement - Major systems (reservations, etc)- Equipment & facilities- Service planning
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• trains less than 750 miles, most in partnership with 15 states
• Are only service at 203 of Amtrak’s 528-served stations
• 220 daily trains – more than half our total!
• We are dedicated to working with states to:• Improve current services• Develop plans for the future• Pursue joint processes (Sec. 209 & 305)• Support and pursue investment opportunities (HSIPR)
• 2011 Partner Satisfaction Program:• Annual survey of partner satisfaction• Integrated local teams to focus on partner top priority issue• Responsiveness and empowerment
….. are Amtrak’s future
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Corridor trains are the key to system growth
Top Ten Performers – Ridership Growth
Piedmont +46%
Blue Water +18.7%
Vermonter +16.5%
Missouri River Runner +14.4%
Alb-N Falls-Toronto +13.8%
Adirondack +13.4%
Chicago-St. Louis +13.1%
Cascades +13.0%
Heartland Flyer +11.1%
Carolinian +11%
Top Ten Performers – Ridership Growth
Piedmont +46%
Blue Water +18.7%
Vermonter +16.5%
Missouri River Runner +14.4%
Alb-N Falls-Toronto +13.8%
Adirondack +13.4%
Chicago-St. Louis +13.1%
Cascades +13.0%
Heartland Flyer +11.1%
Carolinian +11%
Top Ten Performers – Revenue Growth
Piedmont +39.1%
Cascades +31.6%
Missouri River Runner +24.4%
Vermonter +19.1%
Carolinian +17.9%
Chicago-St. Louis +17.6%
Hoosier State +17.5%
Blue Water +15.3%
Adirondack +14.0%
Heartland Flyer +13.5%
Top Ten Performers – Revenue Growth
Piedmont +39.1%
Cascades +31.6%
Missouri River Runner +24.4%
Vermonter +19.1%
Carolinian +17.9%
Chicago-St. Louis +17.6%
Hoosier State +17.5%
Blue Water +15.3%
Adirondack +14.0%
Heartland Flyer +13.5%
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Partnerships with Host Railroads
• Most Amtrak train-miles (70+%) run on freight railroads– We have longstanding relationships with all Class I carriers
– Work with them on grant agreements, as well as daily service issues
• All Amtrak trains on host railroads rely on Rail Passenger Service Act access authority to any US railroad:
– Amtrak gets access in exchange for host railroads not having to offer passenger service
– Basis for entry is contractual – but a host railroad cannot simply refuse to permit:
- new or additional trains- Higher speeds
– Can’t insist unilaterally on dedicated tracks as long as Amtrak and states willing to make improvements needed for safe and practicable service
• Access is at incremental cost not market rates
• Passenger trains receive preference over freight
• Hosts increasingly seeking to modify arrangement based on concern over freight growth and capacity.
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Amtrak and High Speed Rail
• Establishing new Amtrak HSR Department
– Green field projects – participate in design and operation of new HSR corridors
– Lead Next-Gen HSR development on the Northeast Corridor- Major reductions in trip time and significant increases in frequency- Increases in speed up to 220mph, using dedicated trackage and some new alignments
• We have the experience needed for HSR
– 150 MPH service, largest electrified operation, maintenance, panning and engineering experience
• Working with partners
– Amtrak’s principal interest is operational
– NEC Next-Gen HSR: International peer review underway
– FLHSR: partnered with SNCF and Bechtel
– Interconnectivity: integrate new and existing services, especially during development
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Fleet Needs
• Age, utilization, and
• Fleet age, utilization, mileage, and demand are all issues
– Hardest-run fleet in America
– Average age at an all-time high
– No capacity to accommodate growing ridership
• More than 2,000 pieces of rolling stock
• Issued fleet plan in 2010, update out in March
• First tranche of orders last year:
– 70 electric locomotive
– 130 single-level long distance cars
Bob Pickering photo
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Working with the 305 Equipment Pool Committee
• Incorporating 305 Activities into Amtrak Fleet Strategy
– Will utilize 305 Specifications
– Helps achieve:
- Standardization
- Opportunities for state corridor(s) joint acquisitions/partnerships
- Economies of Scale
- Orders of sufficient size to help rebuild the domestic equipment industry
- Create pool of equipment that can be flexibly deployed as necessary
• Implementation framework will be of great importance
– Acquisition and management structure
– Financing
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Questions??
Thank you!