(Bloomberg News circulated the following article by Todd Zeranski on January 27.)
NEW YORK — Amtrak plans to adopt a pricing plan on its popular Northeast trains, similar to ones used by airlines, with fares varying by as much as 15 percent depending on passenger demand and train size.
Prices will be as much as 15 percent lower for passengers who travel on the Acela Express and Metroliner trains during off- peak times, when trains are less crowded, while riders of rush- hour trains may pay as much as 15 percent more, Amtrak said. The change is effective Feb. 6.
The move is part of Amtrak’s attempts to cut costs and revamp operations following the firing of Chief Executive Officer David Gunn last November. Amtrak has never had an annual profit, with recent net losses exceeding $1 billion a year, including what the Government Accountability Office estimated was annual $80 million losses on food and beverage service.
The railroad said it carried a record 25.4 million riders in the fiscal year ended Sept. 30, an increase of 1.3 percent.
The national passenger railroad has lost almost $30 billion since it was founded in 1971, after freight railroads such as Union Pacific dropped their own money-losing passenger trains.
Amtrak said it began testing the price plan last October on some regional service trains between Boston and Newport News, Virginia.
U.S. President George W. Bush last November signed into law a $1.3 billion Amtrak subsidy for the fiscal year that ends Sept. 30, up from $1.2 billion the previous year. The bill also requires Amtrak to look for ways to reduce the federal subsidy through steps such as cutting food and beverage costs.
About 40 percent of the railroad’s costs are covered by government subsidies.
Bush on Feb. 6 will propose his Amtrak funding for the 2007 fiscal year beginning next Oct. 1.
Amtrak officials weren’t immediately available for comment on the plan today.