Why Trains are so Expensive

Train tickets can cost as much as flying, even on heavily traveled routes. The video compares New York–Washington ($49 by train versus $52 by plane), Edinburgh–London (£30 versus £13), and Paris–Lyon (€30 versus €53). These examples show that rail is not consistently the cheaper option.

Long-distance train travel can be substantially more expensive than flying. Between New York and Chicago, the quoted airfare was $59, compared with $108 for the train.

Train fares remain relatively high despite government involvement. The video notes that rail services are subsidized or government-operated in most countries, while airlines operate as commercial businesses. Public support does not necessarily translate into cheaper tickets.

Aircraft cost considerably more to purchase than trains. An aircraft operating between Washington and New York was valued at approximately $49 million, compared with less than $10 million for an entire train serving the same route.

Aircraft also have substantial fuel expenses that electric trains avoid. The example aircraft consumes approximately 1.7 gallons of fuel per mile, equivalent to 3.9 liters per kilometer, while the electric train uses comparatively inexpensive electricity.

The average Amtrak fare between Washington and New York was $73, despite advertised prices starting at $49. The $49 figure represented the lowest available fare rather than what passengers typically paid.

Employee compensation is Amtrak's largest operating expense. The company carried approximately 85,000 passengers daily while employing around 20,000 people, equivalent to one employee for every four daily passengers.

Amtrak's workforce includes many specialized, unionized employees. The video identifies their compensation as a major reason operating costs remain high.

Amtrak spent approximately $105,000 annually per employee, including employment-related expenses. Because taxes and benefits typically add 30–40% to salary costs, the narrator estimated average employee salaries at approximately $75,000 rather than $105,000.

Staffing accounted for $25.82 of the average $73 Washington–New York ticket. Employee compensation alone therefore represented more than one-third of the passenger's fare.

Slower journey times substantially increase railroad labor costs. For Washington–New York, the video compares approximately one hour of airline employee time with three and a half hours for Amtrak employees. Workers must be compensated throughout the longer journey.

Labor-cost differences become much greater on long-distance routes. Between Chicago and Los Angeles, the narrator compares approximately four hours of airline employee time with 44 hours for the train.

Airlines avoid the continuous infrastructure expenses faced by railroads. Airlines pay for airports at their destinations but do not need to maintain a physical transportation corridor between them. Railroads require tracks and associated infrastructure throughout their routes.

Amtrak owned only 730 miles of the approximately 21,000 miles of track it used. Other railroad companies owned most of the network, but Amtrak indirectly paid their maintenance expenses through track-access charges.

A Washington–New York train cost approximately $9.4 million. Its $6.5 million locomotive pulled seven passenger cars costing approximately $400,000 each.

Train equipment accounted for $9.67 of the average Washington–New York ticket. Although individual trains were substantially cheaper than aircraft, purchasing and operating the rolling stock still created meaningful costs.

Railroad tracks typically cost more than $1 million per mile to construct. However, heavily traveled corridors distribute these infrastructure expenses across large numbers of trains and passengers.

Track infrastructure contributed approximately $3.66 to the Washington–New York ticket. Intensive use of the Northeast Corridor helped keep the per-passenger infrastructure expense relatively modest.

Business administration added $2.15 per ticket, while advertising added $1.31. These expenses were separate from staffing, rolling stock, and rail infrastructure.

Accident-related compensation added approximately $0.79 per ticket. Amtrak sometimes pays settlements following collisions that injure or kill passengers or other people, including individuals struck by trains.

The narrator claimed that trains were significantly safer than cars but less safe than airplanes. Specifically, the video asserted that the likelihood of being killed on or by a train was more than three times the corresponding likelihood involving an aircraft.

Other miscellaneous expenses contributed another $5.91 per ticket. These covered smaller operating costs outside the main expense categories.

Amtrak's total stated expense for an average Washington–New York ticket was $50.14. Against the $73 average fare, this produced a calculated operating surplus of $22.86 per passenger.

The Northeast Regional was one of Amtrak's relatively few profitable services. The narrator attributed its financial success to strong passenger demand, comparatively fast journeys, and frequent departures.

Amtrak's Northeast Regional generated approximately $0.08 in profit per passenger-mile. The higher-speed Acela Express generated approximately $0.29 per passenger-mile, making it substantially more profitable by that measure.

Profitable Northeast Corridor services helped finance Amtrak's unprofitable routes. Revenue earned on busy routes supported transportation services that could not cover their own operating expenses.

The Sunset Limited between New Orleans and Los Angeles was particularly unprofitable. According to the video, it lost as much as $0.217 per passenger-mile, with passengers able to travel approximately 2,000 miles on the route.

Rail operators increase ticket prices as departure dates approach. Amtrak might initially offer Washington–New York tickets for $49 but subsequently charge hundreds of dollars for the same journey.

Increasing prices closer to departure allows operators to earn more from passengers with different budgets and travel requirements. Travelers who book early can access cheaper tickets, while those purchasing later may pay substantially more.

A train's operating costs change relatively little with the number of passengers carried. The narrator illustrates this by comparing the cost of transporting five passengers with that of transporting 500. Because much of the expense is fixed, operators have a strong incentive to fill otherwise empty seats.

Rail companies would ideally charge each passenger the maximum amount they were willing to pay. Doing so would increase revenue while allowing operators to fill seats that might otherwise remain unsold.

Passengers' willingness to pay cannot be measured reliably through direct questioning. Travelers have little incentive to reveal their maximum acceptable price, so operators use booking behavior and ticket restrictions to estimate it.

Virgin Trains East Coast used three main ticket categories between Edinburgh and London. These were Advance, Off-Peak, and Anytime, each serving different travel needs and price sensitivities.

Standard-class Advance tickets ranged from £30 to £140. These were generally the cheapest fares but came with the greatest restrictions.

Advance tickets were sold through limited allocations at different prices. The narrator illustrates a possible system in which 15 tickets sell for £30, followed by tickets priced at £35, £40, £45, and progressively higher amounts as cheaper allocations sell out. The number available at each price was not disclosed.

Advance tickets encouraged passengers to commit to specific journeys early. They were valid only for the purchased route, date, and departure time, making them less useful to passengers whose plans might change.

Tourists were particularly suited to discounted Advance tickets. Leisure travelers generally planned further ahead, paid their own expenses, and were more sensitive to ticket prices.

Cheap flights created additional competition for leisure passengers. Tourists traveling between Edinburgh and London might choose an inexpensive flight rather than pay more for the convenience of a train.

Business travelers generally booked later and valued flexibility more highly. Their arrangements were often finalized only days or weeks before departure, making restrictive Advance tickets less attractive.

Business travelers were also less sensitive to ticket prices because their employers often paid. This allowed operators to charge higher fares for convenience and flexibility without losing every price-conscious passenger.

An Anytime ticket between Edinburgh and London cost £148.50 in standard class. It allowed travelers to choose their train without committing to the same fixed departure restrictions as Advance tickets.

Anytime tickets accommodated uncertain business schedules. The narrator describes passengers being able to travel on short notice or defer their journey rather than being tied to a particular departure.

The standard-class Off-Peak ticket cost £137. It provided greater flexibility than Advance tickets while remaining cheaper than the £148.50 Anytime fare.

Off-Peak tickets allowed journeys arriving in London after 11:17 a.m. or traveling on weekends. This restriction encouraged passengers who could avoid busy morning services to choose less congested departures.

Off-Peak fares offered a compromise for business travelers with flexible schedules. They could retain considerable freedom over their departure while receiving a modest discount for avoiding peak travel periods.

First-class Advance tickets ranged from £40 to £200. These offered a premium accommodation option while retaining the pricing structure and restrictions associated with early booking.

First-class Off-Peak tickets cost £185.50, while first-class Anytime tickets cost £236.50. Passengers paid additional amounts for both upgraded accommodation and greater scheduling flexibility.

Railcards provided discounts of up to one-third for eligible passengers. The video identifies young people, disabled travelers, and older passengers as groups eligible for these reduced fares.

The combination of booking categories, travel classes, and discounts created approximately 12 ticket options. The narrator illustrates how two passengers seated beside each other could pay £20 and £200 respectively for essentially the same journey.

Ticket-price differences primarily reflected flexibility, booking circumstances, and passenger characteristics rather than the physical cost of transporting an individual. Operators used different fare conditions to collect more revenue from passengers willing to pay for convenience while still attracting budget-conscious travelers.

Amtrak served more than 500 destinations across 46 American states. Many were small communities with few alternatives for public transportation.

Operating only profitable routes would substantially reduce Amtrak's geographical coverage. The narrator argues that commercially unsuccessful routes are nevertheless important because they connect communities that might otherwise lose essential transportation services.

Rail service can be cheaper to provide to small communities than commercial aviation. Although train tickets may be expensive on major routes, serving rural towns by rail often requires considerably less local infrastructure than operating an airport.

Small airports require substantial infrastructure regardless of passenger demand. Even an airport handling only two or three flights daily needs a runway, terminal, security arrangements, and air traffic control.

Rural railway stations generally require much less infrastructure and maintenance than rural airports. This makes trains a comparatively practical transportation option for communities with limited demand.

Flying from Havre, Montana, to Chicago was quoted at $811 for a May 17–22 itinerary. The narrator contrasted this with a $741 flight from Chicago to London, illustrating how expensive air travel from smaller American communities could be.

Amtrak offered transportation between Havre and Chicago for only a few hundred dollars. This made the train substantially more affordable than the $811 airfare quoted for the same origin and destination.

Havre residents were described as earning approximately $22,000 annually. At that income level, the difference between a train costing a few hundred dollars and an $811 flight represented a significant financial consideration.

Serving smaller communities helps explain why fares on profitable routes remain relatively high. Profits generated by busy services help finance routes that cannot recover their operating costs but provide transportation access to rural populations.

Maintaining unprofitable rail services is partly a political decision rather than a purely commercial one. The narrator presents nationwide connectivity as a public obligation that cannot be evaluated solely through individual route profitability.

Access to transportation was linked to economic mobility. The video cites research indicating that transportation accessibility had a stronger relationship with whether someone earned more than their parents than either neighborhood crime levels or growing up in a two-parent household.

The economic importance of rural rail extends beyond ticket revenue. Maintaining affordable links allows residents of smaller communities to reach destinations and opportunities that could otherwise be financially or practically inaccessible.

The $22.86 surplus calculated for an average Washington–New York ticket illustrates Amtrak's cross-subsidy model. Money earned from passengers on profitable Northeast Corridor services helps maintain affordable transportation options for communities such as Havre, Montana, where flying to a major city can cost more than an international flight.