Why can't train tracks be reused by 3rd party companies for passenger travel?

Forget it. That space is stuffed solid!

The US national rail system is privately owned, relatively unregulated, and reasonably profitable. It handles almost exclusively freight. Freight business in the US has been very, very good. It’s a highly productive country still with a lot of industry, that is too dry and rugged to have an extensive canal system. The freight railroads regularly “jackpot” – so many trains that every siding is full of trains waiting for opposing traffic.*

After World War II, Europe and USA’s freight rail networks were both doing the same thing – circling the drain. Penn Central bankruptcy, all that. Everyone loved trucks and airplanes. In Europe, they kept upping the regulations, Britain had the Beeching Cuts where they cut a bunch of lines. In America we had the 4R and Staggers Act, which deregulated the railroads and gave them a free hand to abandon lines. It was like an Ayn Rand fable. There was a flurry of abandonments and suddenly Boom! Even the wreckage of the bankrupt northeast railroads, merged into US-owned Conrail, was turning wicked profits. Pretty embarrassing to report a 600M profit while the government is trying to sell it off for $1200M! To be clear, US railroads pay their own way on infrastructure, which they own, unlike Europe.

Today something like 40% of US ton-miles move by rail, a much higher ratio than Europe despite the US’s well-developed freeways.

Anyway in the US, if you have a boxcar you want to route to a destination, it’s a seller’s market. Grain elevators are running into this; the railroads don’t even want to talk to them unless they can deliver an entire unit train. They just don’t have the precious track bandwidth needed to send a local job out there to switch single cars out of industries. They would rather have you container it, truck it to a container terminal withon 200 miles and handle it in a container train.

They’ve been on a tracklaying binge, putting back double-track they previously ripped out, putting in double track that never was, even triple tracking in some places. The abandonments have hit rock bottom and now it’s all about building. Of course the new trackage is mostly going in the west and south, the previous abandonments were in the east.

About 10 years ago in Railway Age there was an article saying the national rail network was going to come unglued unless it got about $60 billion of additional capital. This was beyond anything the privat sector can finance. **

So why does the freight industry even return Amtrak’s phone calls? Because they know economic downturns happen. They’ve seen yards stuffed with cars that are not circulating and locomotives not needed. And in those times, Amtrak is their most reliable customer.

* Amtrak has had to follow a coal drag for 100 miles simply because there is no siding without a freight train in it. One time I was on the northbound Coast Starlight. We passed the tail of a train going our way who was sitting in the siding. There was a man on the tail with a lantern and radio As soon as we were by the south switch, it started backing up southward. (!) We passed his engines, then we passed the engines of another train, also on the siding, also starting to move south. And then we stopped at the north switch of the siding. As soon as the second train’s tail was by us, we proceeded. They did All that for us to slip by these two trains passing each other.

** Just to give you an idea how close to “tilt” the system is, one time the Southern Pacific (former Central Pacific, west end of the Transcontinental Railroad) decided to close two small railyards in Houston and work their business out of the biggest yard. Within 24 hours trains were backed up to the Texas border (and Texas is huge). SP just took a little-used branchline and told all the backed-up trains to drive down the branchline until they couldn’t, then stop. With them off the board, they immediately reopened the two yards, got flow moving again, and unstacked the branchline during any spare time. Lesson learned. 20 years later Union Pacific (east end of the Transcontinental) bought Southern Pacific…

…and said “hey, why bother having 4 yards in Houston?” The SP old-heads said “bad idea”. And when trains were backed up to Texas border, UP doubled down. Trains backed up to L.A. And started backing up everywhere else too, since there was nowhere for anything to go, and so many locomotives are trapped in this mess. No railroad will interchange their cars to UP because they know if they do, they’ll never see those cars again. It was a month of hell, and finally so many customers gave up on UP, plus them pulling every trick in the book, they finally figured out how to make it without those yards… But it was insane. They made the stock market dip.

This data is from 2014, but the broad patterns are still the same today: Amtrak routes by 2014 cost recovery. With the exception of the Northeast Corridor (and we’re ignoring capital costs here, which are substantial as well) and adjacent routes, Amtrak’s routes do not come remotely close to covering their costs. Most of the passengers are on the shorter routes between major cities, while very few are riding the long distance routes.

If Amtrak is hemorrhaging money on most of these routes, there’s no reason a private investor is going to want to compete with them, especially as they won’t be getting the subsidies Amtrak receives. If the California Zephyr loses large amounts of money operating as a once-a-day service, there’s little appetite for anyone to pay to run it more often.

There is one privately-owned intercity passenger railroad in the US: Brightline in Florida, which just opened last year. There are also proposals for new private high speed rail projects like XpressWest. These routes do not duplicate current Amtrak service.

A few issues to think about:

• There are plenty of other trains running on those tracks – freight, commuter trains, maintenance vehicles, etc. The tracker simply doesn’t show them.

• Only a small fraction of the track used by Amtrak is actually owned by Amtrak (mostly along the Northeast Corridor). The rest belongs to various private railroads and Amtrak pays for the right to run their trains there. In principle other operators could do the same, but it wouldn’t be up to Amtrak to decide.

• Amtrak requires a variety of government subsidies to stay in business. It’s unlikely that another company would find it profitable to run long-distance passenger trains. (Short-distance rail is usually done by local transit authorities, which are also usually subsidized.)

Tracks are used by freight trains in addition to Amtrak. I have witnessed this many times.