Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Amtrak Derails on Increased Demand


Rising tide of commuters faces crowds, delays.

Amtrak ridership rose 13% in July from a year ago as high gasoline prices force more people out of their cars.

But there's just one problem: Amtrak is straining to meet increased demand, the Wall Street Journal reports.

Ridership is up 8% on Amtrak's Northeast Corridor between Boston, New York and Washington, the system's most heavily traveled line, but passengers are forced to stand on some trains while aging track and the overhead electrical distribution system limit train speed in some areas.

Amtrak doesn't have enough rolling stock to add coaches to currently scheduled trains or to add trains at peak hours. Premium-priced Acela Express service in the Northeast Corridor is nearing capacity.

There's no immediate fix. The House and Senate have approved bills that could increase Amtrak's funding by 33% or more starting in October. The measures also would create a grant program to encourage states to expand rail service.

Democratic Senator Tom Carper of Delaware has introduced a bill that would authorize about $3 billion in borrowing by Amtrak to replace old rail cars and would divert $400 million in gasoline taxes each year to set create a fund to buy new rail equipment, including locomotives.

That's a start. Amtrak estimates it needs $5 billion to complete needed repairs and upgrades on the Boston-New York-Washington line alone. It recently shut down service between Boston and New York to replace a section of the bridge across the Thames River in Connecticut.

In California, ridership between San Francisco and Sacramento is up 33%.

Some dream about 200-mph service between major cities, but that's not likely. It would require billions of dollars to acquire the right-of-way and billions more to build special tracks parallel to existing lines.

For now, expect crowded trains. In the future, look for better service with speeds topping out at about 100 mph on trains using newer but traditional equipment.

Meanwhile, Exxon-Mobil (XOM), Chevron (CVX), Conoco (COP) and Valero (VLO) can look for solid quarterly earnings reports.
< Previous
  • 1
Next >
No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Featured Videos