Amtrak looks to woo riders with upgrades
Posted on Saturday, March 18, 2006
URL: http://www.nwanews.com/adg/Business/149048/
SHELBY, Mont. — Karyn Hamilton, like many Amtrak riders, had a dim view of the nation’s passenger railroad as low-class, uncomfortable and not much better than a bus.
But the marketing director of a financial-management firm in Portland, Ore., changed her mind during a trip last August on the Empire Builder, an Amtrak long-distance train undergoing a dramatic makeover that includes new carpeting and colors, pleasant staff and upgraded food service.
As the silver, diesel-powered train rolled across the prairie, Hamilton and other first-class passengers were treated to a wine-and-cheese tasting party. They dined on meals made with recipes drawn from the bygone heyday of train travel. At bedtime, she found a fresh-baked chocolate-chip cookie in her spiffed-up sleeping cabin.
“It’s getting more like a cruise ship,” Hamilton says.
After years of financial and political crisis, Amtrak is making a calculated gamble: To boost revenue on longer-haul trains — like the Texas Eagle that travels through Arkansas each day — the railroad is altering its longstanding one-sizefits-all approach to passengers.
Instead, it is courting affluent leisure travelers willing to pay extra for first-class, sleepingcar service. The differential is substantial. Fares vary by season and day of the week, but if someone were planning to travel, for example, on April 16, a one-way coach fare from Chicago to Seattle would cost $ 134 for the twonight trip. First-class passengers would pay the basic coach fare plus $ 270 more for a roomette or $ 466 for a bedroom.
The changes began with a major makeover of the Empire Builder last summer. Now, Amtrak plans to extend the changes to some other long-haul trains, while also attacking union work rules and bloated food-service expenses.
The shake-up is an acknowledgment by Amtrak officials that they are running out of chances to stave off pressure from the Bush administration to break up or even liquidate the federally subsidized — and unprofitable — railroad.
“We’re living on borrowed time,” says David Laney, Amtrak’s chairman. “We have to demonstrate what we can do on our own before it is taken out of our hands.”
Last year, the Bush administration proposed eliminating subsidies to Amtrak, which has been kept afloat with $ 30 billion in federal aid since 1971, according to the Department of Transportation. And the administration’s latest budget request includes $ 900 million for Amtrak — a 31 percent cut — for fiscal 2007. On Thursday, Amtrak said it would ask Congress for $ 1. 598 billion.
Laney says the next crucial step for Amtrak is to fix some notorious customer-service problems, including dirty cars and unhelpful and rude onboard employees. About 30 percent of all Amtrak trains are late.
The restructuring likely puts Amtrak on a collision course with its 17, 000 unionized workers, two-thirds of whom haven’t had a new contract for about five years. Amtrak officials estimate union restrictions cost the railroad about $ 100 million a year.
Edward Wytkind, president of the AFL-CIO union’s Transportation Trades Department, said in a statement that the Bush administration’s reform effort is an attempt to “scapegoat workers for the failures of the federal government and the current Amtrak board.”
Still, Amtrak believes better service will lure riders and shrink losses on long-distance lines.
On long-distance routes that are primarily used by passengers for basic transportation, the railroad is rolling out a new type of dining service that makes greater use of precooked meals and introduces disposable plastic plates. Those changes are designed to cut the number of dining-car employees to three per train from five or six. Routes that will see such changes include the Texas Eagle — which travels between Chicago and San Antonio and makes stops in five Arkansas cities — and the City of New Orleans.
Meanwhile, Amtrak is replacing mandatory meal-serving periods with more flexible hours. Over the next few years, it also plans to rebuild dining cars to replace traditional table seating and allow passengers to sit at the bar or watch passing scenery from crescent-shaped booths that face the windows. Conductors, in some cases, will stay up all night in the dining car in case they are needed.
The Empire Builder is the rolling laboratory for some of the changes. The train, which made its first trip in 1929, is one of Amtrak’s most popular, carrying nearly 500, 000 riders a year. During the daily 2, 200-mile trek between Chicago, Seattle and Portland, the Empire Builder chugs past spectacular scenery.
So far, the Empire Builder makeover appears to be enticing more passengers, particularly during the off-season when ridership typically declines.
David Hughes, Amtrak’s acting president, emphasizes, however, that it is impossible to ever make long-distance trains like the Empire Builder profitable. Those trains are expected to generate $ 382 million in fiscal 2006, or about one-fourth of overall Amtrak revenue, but post losses of more than $ 493 million, or about $ 125 for every passenger.