Tuesday, October 25, 2005

Amtrak Fare Increase - My Details and Analysis for Buying the Monthly Pass Ongoing for the Philly to NYC Commute

In my prior post "Amtrak Fare Increase - details from amtrak.com" some info on the large fare increase Amtrak is imposing was discussed. The particulars of the fare increase for commuting between Philadelphia and New York ongoing I'll cover here. I'll chat on alternate ticketing options via Amtrak once the fare increases are fully in place by March 2006. I'll start today with reviewing the monthly pass option for Amtrak commuters.

Monthly Pass Option Ongoing - The Numbers, The Details
Currently (November 2005) a monthly pass between Philly and NYC Penn Station is $821. The monthly pass starting in March 2006 will be $1,008. This is up from $633 in October 2005, from $597 in January 2005, and from $569 in 2004. So up nearly 60% from Oct '05 to March '06 and nearly doubling from 2004 to Mar 2006. Pretty ridiculous. Amtrak based the new price on taking 36 one way trips per month at the max fare and cutting that in half; that makes it $28 per trip with the Amtrak math.

The most week days (M-F) in a month in is 23 (for 2006: March, May, August), or 46 total one way trips max (really 44 in May as there is a holiday that month). The number of week days per month breakdown for 2006:
  • Jan - 22
  • Feb - 20
  • Mar - 23
  • Apr - 20
  • May - 23
  • Jun - 22
  • Jul - 21
  • Aug - 23
  • Sep - 21
  • Oct - 22
  • Nov - 22
  • Dec - 21
Average: 21.67 working days/month

Assuming you go up and back every day in March, May, and August 2006 (going with the 46 number), that would make the price about $22 per trip at the monthly pass rate of $1,008 (and who knows, Amtrak may raise the price again sometime in 2006). But on average let's say there's 20 working days in a month (makes the math easy) for a possible of 40 total one way trips/month. This makes the price about $25 per trip with the $1,008 price. But how often would someone do this? Between company holidays, vacation days, sick days, work at home days, and company business travel away from the office, it's unlikely that a person would consistently average anywhere near 40 trips a month between Philly and NYC. And how often would someone even take 36 one way trips using the Amtrak math? And how did Amtrak come up with this number? Did they do any market research on regular commuters who use Amtrak? Does Amtrak no longer want to be in the commuter business and are trying to price commuters out of Amtrak?

A more likely monthly average for the Philly to NYC commuter based on my experience is between 20 and 30 one way trips total (or between 10 and 15 round trips). The cost at the low end, 20 total one way trips/month, is an average of about $50 per trip; at the high end, 30 one way trips/mo, is $33.60 per trip. That's a decent spread in the average, let's split the difference and say if you get a monthly pass you'll pay an average of $42 per trip assuming you commute at an average of 25 total one way trips in a month. At the October 2005 monthly pass price of $633 this was about $25 per trip.

At the start of a given month, only if you know you'll be taking over 30 one way trips between Philly and NYC, and you put a premium on the convenience of having the monthly pass (and you have money to burn), then the monthly pass is still a viable option.

My analysis - folks buying monthly passes between PHI-NYC will plummet to near zero and we'll find other options. I have no idea how Amtrak revenue for travel between PHI and NYC will play out. I've heard estimates that 700 to over 2,000 monthly passes (oringially I linked here but page since taken down, the article is "Amtrak Revives Plan for Fare Increases" published Wednesday, 28 September 2005, by Larry King, The Philadelphia Inquirer) between Philly and NYC are sold each month. Amtrak will lose this revenue only if these folks no longer commute on Amtrak (an option). Commuters will have to pursue other ticketing options besides a monthly pass (but likely still choosing Amtrak), so we're still giving them money. But we're not going to buy the new high price monthly passes so Amtrak revenue won't dramatically increase either. Again, what's Amtrak's motivation here? They're not going to convert all these monthly pass buyers to the new higher price, they'll lose cash flow with no large up front cash payments at the start of the month, so it's not clear what they hope to achieve.

The $633 price point for a monthly pass was a good number I felt. I don't have a car so I translate theoretical car payments (plus parking, insurance, gas, maintenance) into commuting costs. So I feel it's a push here, even at $700/month or a little higher would still be a push. Commuting cost at $633/month translates to a ~$7,500 in commuting expenses per year. But there are a few months during the year where I do not need to get a monthly pass and commute via cheaper options (I'll discuss these later), so in reality I'm spending under $7,000 a year to commute to NYC.

So this is my price point for commuting expenses over they course of a year: $7,000. If I can come in around that price then I'm OK. Buying a monthly pass at $1,008 would pretty much kill making this target. Now I don't yet know how to make this budget number as this is what I'm working on, but I do know that the Amtrak monthly pass will no longer be in the equation for commuting to NYC. When I have a plan of attack, I'll update the blog with details.


  • Commute at those prices? Not likely. Rather rent a room somewhere and come home on weekends. let Amtrak hang themselves if that's what they want.

    By Anonymous Anonymous, at 12:29 PM, July 25, 2006  

  • I used to commute from PHL to NYC everyday, but I couldn't stand it, so in Feb 2004 I found a place in NYC for less than $1,000. But now I have to move out from the studio apt, but I can't find anything in NYC below $1,400. I have a mortgage and not paid well, so I might go negative. So the only solution for me is start using the China bus or Grayhound bus. Life is very tough for commuters. But the last time I check Grayhound but, they are offering a return trip for $18 from Mon to Thurs.

    By Anonymous Anonymous, at 11:57 PM, August 28, 2006  

  • This definitely put me in a tailspin after I finished my grad. degree in NYC. I commuted from Philly to NYC for 3 years and in the last couple of months is when the prices went in to the stratosphere it put job hunting in NYC on indefinite hold. It doesn't make sense to me how these prices are still this high and it entails a lot of risk for Amtrak on top of screwing over loyal commuters that give Amtrak a consistent cushion.

    I was on those trains enough to know how many empty seats there are on off peak rides, a couple of bad months of spotty ticket sales will put Amtrak in front of Congress, like every other irresponsible business, asking to get bailed out AGAIN. I'm currently unemployed, but am looking to start my own business soon, locally and after 2 years of drudgery and set-up. Would have been a little easier had Amtrak throttled the ticket price increases, but I've survived, so far.

    ...When I say irresponsible I mean that I'm looking at Bolt Bus (http://www.boltbus.com) with their electrical outlets, free wireless and their $10 a trip fair that I just found after seeing a CBS 3 report a couple of months ago. I can't help but to shake my head at Amtrak. Buses run on gas and trains run on electricity, it costs less to pollute the environment and more to pay Amtrak's "fuel costs" even though PHL to NYC is all electric.(price increase was a SCAM from the start)


    By Anonymous Anonymous, at 11:02 AM, December 11, 2008  

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