Out of Control Policy Blog

Intercity Bus Service Could Replace Amtrak

This year the Passenger Rail and Reinvestment Act of 2008 (PRIA) is up for reauthorization. Similar to other reauthorizations, Amtrak will likely argue that a federally-funded rail system is the "best way to keep costs low, provide customer choices that build ridership and develop economies of scale." Forget for the moment that all Amtrak lines, save two, are money losers even with federal and often state support. Forget for the moment that the big financial losses of long-distance trains defeat the economies of scale idea. Forget that ridership of 30 million pales to the number who drive or fly. All of these arguments have been discredited numerous times. Focus on the one argument that up until now has resonated with Congress: the “customer choices” argument. 

Amtrak was founded in 1970 to allow freight rail operators to quit operating money-losing passenger rail service. Since its inception the government corporation has been a continuing black hole. While fiscal conservatives have long argued that Amtrak lost money, most Democrats and some Republicans have successfully countered that Amtrak offered a unique transportation service. While automobiles offered a customizable journey from one place to another and planes offered a quick but pricy alternative, Amtrak offered the slow but cheap alternative. And since most Congressman were unwilling to cut a travel option for their community, funding for Amtrak remained. 

But over the last ten years, another low-cost competitor has joined the party--Inter-city buses. Unlike Amtrak they do not require taxpayer subsidies. Unlike Amtrak they travel in shared right of ways with cars so they do not require building and maintaining separate running ways. And unlike Amtrak they are owned and operated by private sector companies that actually want to please their customers. 

To highlight the advantages, M.J. Bradley & Associates prepared an analysis for three groups: Reason Foundation, Taxpayers for Common Sense and the American Bus Association that compares customer costs and societal costs for 20 trips that can be taken by either an Amtrak train or a scheduled motorcoach bus. 

The study found: 

  • In general there are more schedule options by bus than by train;
  • Total travel time is comparable for these modes;
  • Considering fully allocated costs the motorcoach cost per passenger is less than 25% of the cost to provide comparable Amtrak service;
  • Amtrak generates enough revenue to cover both operating and capital costs on only 2 of the 20 analyzed trips;
  • Excluding the Northeast corridor, per-passenger emissions of particulate matter and nitrogen oxides are 80% lower for motorcoach trips than for Amtrak and per-passenger emissions of volatile organic hydrocrabons are 90% lower. 

The Amtrak reauthorization in 2013 could be different because travelers have the option of high quality, low-cost buses. Since Amtrak no longer operates a unique service, there is no need for the federal government to continue funding it. The one valid argument for continued public funding of Amtrak has been derailed. 

The entire study is available here.

Baruch Feigenbaum is Transportation Policy Analyst


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