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Cost-cutters aim at Amtrak amenities
Question of the Day
The Bush administration yesterday endorsed a recommendation from the Transportation Department inspector general that Amtrak eliminate its food service and sleeper cars on some long-distance routes in a drastic effort to cut costs.
The dining and sleeper cars cost Amtrak more money than they generate, but railroad officials have told Congress they are important parts of their customer service.
“Overall, our analysis shows that eliminating sleeper cars, dining cars and other amenities on Amtrak’s long-distance routes could save between $75 million and $158 million per year in operating costs and avoid an additional $79 million in planned annual capital expenditures,” a report released yesterday by Transportation Department Inspector General Kenneth Mead said.
Other amenities the report recommends cutting include on-board entertainment, lounge seating and checked baggage service.
Transportation Secretary Norman Y. Mineta agreed with the report, saying, “It is time for Amtrak’s management to show its commitment to preserving and improving passenger rail service in this country by acting on the [inspector general’s] recommendations without further delay.”
Amtrak officials did not dispute the inspector general’s findings.
“In the months to come, Amtrak will be launching a number of pilot projects intended to identify the most effective strategies for addressing the long-distance operating cost issues you have highlighted,” Amtrak Chairman David Laney wrote to Mr. Mead.
However, on previous occasions Amtrak has said cutting its amenities would hurt the railroad more than help it.
Amtrak officials told the House Transportation and Infrastructure railroads subcommittee during a June 9 hearing that without the services, ticket sales revenue would drop.
“There are people on these trains,” said William L. Crosbie, Amtrak senior vice president. “It’s not just a piece of steel running up and down a track.”
The food service for passengers “was never intended to be a profit center,” he said. “When it’s dinner time, they expect to be served dinner. It will never be profitable.”
Of Amtrak’s 19,600 employees, 1,155 work in the food and beverage service, which is offered on 90 percent of the railroad’s trains.
The inspector general said alternatives to the dining car could include serving passengers boxed meals or selling packaged food from carts, like the airlines have begun doing.
Sleeper cars are used by 16 percent of Amtrak’s long-distance passengers each year, the inspector general’s report said. The other 84 percent ride coach class.
Last year, Amtrak lost $600 million on its 13 long-distance routes of more than 500 miles.
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