Amtrak on-time performance woes mirror host railroad freight service, shippers say

Rail shipper groups say the poor on-time performance of all 15 Amtrak long-distance trains — which prompted the Justice Department to file a lawsuit last week against Norfolk Southern for its handling of the Crescent — is merely a reflection of Class I railroad freight operations.

“This is a symptom of freight rail network capacity and fluidity problems. While some may view it as a zero-sum game, the root cause is that the railroads, not just NS, have elected to avoid investing in adequate staffing and adequate track capacity,” says Ann Warner, who represents several shipper groups including the Freight Rail Customer Alliance and National Industrial Transportation League.

Class I railroad freight service, shippers argue, suffers from Wall Street’s insistence on low operating ratios and keeping capital expenses to a minimum in order to fund share buyback programs.

“The result is that they run trains that are too long for their existing sidings, causing congestion, degraded velocity, poor service, and a lack of resiliency,” Warner says. “These are the same problems that plague shippers generally — Amtrak is just the canary in the coal mine.”

Wick Moorman, who served as Amtrak’s chief executive for a year after retiring as CEO of Norfolk Southern in 2015, says the canary analogy is correct. While at the helm of NS, Moorman would take a close look at Amtrak performance on each corridor. “If Amtrak wasn’t running well, you needed to take a look at what else was going on,” he says.

The Justice Department suit, which contends NS has not given the Crescent the right of preference over freight trains, is only the second filed since Amtrak was created in 1971. A similar case, which Amtrak brought against Union Pacific in December 2022 over freight train interference with the Sunset Limited, is making its way through the Surface Transportation Board. It’s the first on-time performance dispute brought to the STB since the agency gained the authority to investigate violations of the federal Amtrak service standards that went into effect in 2020.

Moorman says the preference statute is open to interpretation. The frustration at Amtrak, he says, is what does preference mean? “The first thing you have to do is define preference and link it to some acceptable level of on-time performance,” Moorman says. The second step is creating an enforcement mechanism that will ensure that level of on-time arrivals, he says.

Some rail shippers are nervous that a strict interpretation of the right of preference will degrade freight service. Rick Paterson, a railroader turned financial analyst at Loop Capital Markets, closely follows the performance metrics that the freight railroads are required to report to the STB each week. He says shippers’ concerns are justified in busy freight corridors shared with Amtrak trains.

“There’s certainly a recipe for chaos here if every Amtrak train suddenly becomes a true hotshot and everything ahead has to get out of the way,” Paterson says. “We’ve seen situations in the past when the railroads tried to run fast small parcel intermodal hotshots for UPS, but the operational disruption was untenable.”

Several veteran railroad operating officials also pointed to the UPS bullet train experiments from two decades ago as an example of what can happen to overall service levels when priority trains see nothing but green signals and are able to run at track speed over their entire routes.

BNSF Railway parted the waters for the once-weekly UPS hotshot that left Los Angeles on a Monday and was due in New Jersey by Friday. BNSF determined that the delays the bullet train inflicted on the rest of its traffic were unacceptable. Norfolk Southern reached the same conclusion after its participation in the test runs east of Chicago. Union Pacific picked up the baton, however, and ran the service for a few months in conjunction with CSX. But UP threw in the towel, too, due to the collateral damage the hotshot caused to the rest of UP’s traffic, including its high-priority Z trains.

“Passenger trains are just as disruptive to the operation and sap main track capacity,” a former chief operating officer says. “Yes, they are shorter and pass quicker; however, the dispatching teams’ planning and setting up of the railroad still creates a ripple effect of delays had they not been there.”

A veteran network operations official says the Precision Scheduled Railroading strategy of running fewer but longer trains creates a capacity dividend that should benefit Amtrak. “Run an operating plan that minimizes the number of active trains on the network, which enables the hotshots to get out and run,” he says. “It is much easier to run a train with seven 10,000-foot trains versus 10, 7,000-foot trains, and the reduction in active trains has dramatic effects on train velocity and schedule adherence.”

Amtrak did not respond to a Trains News Wire request to interview CEO Stephen Gardner about preference matters. But Gardner, in November 2020 testimony to Congress, said there’s no evidence that providing passenger trains with preference limits the efficiency of the freight network, hurts service, or brings freight to a standstill.

Freight railroads, Gardner noted, can seek relief from the STB if they believe that Amtrak trains harm freight operations. “The fact that not one railroad has sought such relief suggests that either railroads do not believe providing preference affects the quality of service provided to shippers or the railroads are not providing Amtrak with preference in the first place,” Gardner told Congress.

The Association of American Railroads declined to comment on the Justice Department lawsuit and referred questions to individual host railroads, which also declined to comment.

But in testimony last year before a House Transportation and Infrastructure subcommittee hearing on Amtrak service, AAR CEO Ian Jefferies noted that freight railroads welcomed the opportunity to exit money-losing passenger service with the creation of the national passenger railroad in 1971. “Freight railroads were also required to provide ‘preference’ to Amtrak service on their lines, a right that exists to this day but in a fundamentally different freight and passenger rail landscape,” Jefferies said, noting that Amtrak is not required to support capacity improvements.

When Amtrak was granted the right of preference in 1973, freight railroads had excess capacity. But the Staggers Act of 1980, which partially deregulated the industry, helped spark a freight rail renaissance while also permitting the abandonment of redundant main lines.

The freight railroads also lifted sections of double-track or multiple-track main lines. As a result, the Class I railroads today concentrate far more tonnage on far less mainline trackage, leaving Amtrak competing for limited capacity. “The Class I railroads are a bit like the man who murders his parents and then asks for mercy as an orphan,” former STB Chairman Martin J. Oberman noted several times while he was chairman.

Oberman, who retired in May, tells Trains that the board is handling the Sunset Limited case while fully recognizing the complexity and nuances of the way a national freight and passenger network should work.

Some observers say it’s unclear whether and to what extent the Justice Department and federal courts will balance Amtrak’s right of preference with the need to efficiently move freight.

The freight network must remain fluid, Oberman says, noting that if it doesn’t, then Amtrak service and the economy would both suffer.

There’s no question that enforcement is required, Oberman says, because there are many times when host railroads intentionally fail to give Amtrak preference. The question, he says, is what the remedy should be so that trains meet on-time performance standards. Is additional capacity needed? If so, should taxpayers be on the hook or should the host railroad chip in as well? And if so, what should the public-private funding split be?

Gardner told Congress that a lack of preference enforcement has meant that public investments in rail capacity projects have not produced the desired improvements in on-time performance.

Norfolk Southern has said that it’s “committed to complying with the law, working together, and honoring our commitments. Over the past several months with Amtrak, we have focused on the on-time performance of the Crescent passenger train. We hope to resolve these concerns and continue to make progress together.”