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Reason Foundation

High Quality Intercity Bus Makes New Rail in California Unecessary

Baruch Feigenbaum and Michelangelo Landgrave
February 5, 2014, 10:50am

Until 2012 the best way for visitors to travel around California was by rental car. And folks who did not want or could not rent a car were out of luck. What has changed the equation is a high-quality dependable travel solution that has grown between 5.1% and 9.8% every year since 2006 and does not require one dime of public subsidy. This new technology is intercity bus service.

In late 2012 Megabus, a discount intercity bus company, entered California. The company currently serves Burbank, Los Angeles, Oakland, Riverside, Sacramento, San Jose and San Francisco. An 8-hour SF-LA route costs $30-50 each way; a five and one half-hour L.A. to Las Vegas trip costs $5-$12 each way. Bargain finders can get tickets for as low as $1. Megabus is not alone, competitor Boltbus offers L.A.-SF tickets at $9.00 each way and tickets to Las Vegas at $8. Boltbus also serves Oregon, Washington and British Columbia with stops in Portland, Seattle, Vancouver and many smaller communities. California Shuttle and other companies also serve the growing West Coast market.

There are many reasons why passengers would choose intercity bus over Amtrak. First, Amtrak does not offer intercity bus service between Los Angeles and Las Vegas. Even on certain routes where Amtrak does offer conventional rail service such as the Los Angeles to San Francisco route, passengers must transfer to a bus in Oakland to reach San Francisco. But even if a passenger decides to take the train to Oakland and then use Bay Area Rapid Transit (BART) heavy-rail to get to San Francisco, the bus is cheaper ($15.00 compared to $60.00) and faster 7.5 hours compared to 11 hours.

Cost is a major reason that young riders, who are one of the largest user groups for intercity Bus, choose this mode. Younger people have lower incomes than their older counterparts. There is no great mystery to this; many young people are still completing their education or starting their careers.

The technology offered on Megasbus and Bolt also plays a major role. Recent studies by the US Public Interest Research Group, the American Public Transit Association (APTA), and the U.S. Department of Transportation showed that some riders, namely the young, are willing to tolerate longer travel times if they are able to work and otherwise continue their activities while in transit. It also shows that younger riders are more willing to use alternative transportation. This younger demographic is willing to put up with longer transit times, not because they are more patient than older groups, but because advances in technology allow them to use their smartphones, laptops, tablets and other devices while in transit.

Megabus and Boltbus do not operate from stations. They have curbside pick-up at designated stations throughout the city. Bus operators found that bus stations are expensive to maintain and discourage ridership since many riders find bus stations depressing. Some potential riders would not ride traditional intercity bus service solely because of the bus stations. Waiting outside for a bus is not enjoyable in extreme weather. But California has very few of these days.

With the addition of intercity buses travelers now have at least three different unsubsidized ways to travel around the country. Travelers wanting the fastest trip can fly. Air travel is expensive, especially when tickets are purchased last minute, but it is quick. Travelers wanting a more personalized trip can drive. Auto travel is slower than air travel and more expensive than bus travel. But cars can stop along the way at a specific restaurant or to see a specific attraction, in the ways buses and airplanes cannot. Bus travel is the cheapest—it is cheaper than Amtrak on 95% of the routes where the two modes compete. It is often faster than Amtrak depending on the road and rail infrastructure.

These three ways of travel make train Amtrak increasingly unnecessary. Private-sector rail definitely has a role in the Northeast corridor and other corridors where it is self-supporting. But with intercity bus travel operating without a subsidy, the argument that a subsidized government-run train monopoly is needed to provide a low-cost alternative to flying is irrelevant.


Baruch Feigenbaum is Transportation Policy Analyst


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