Examining what Amtrack needs to do to improve its business model and profits.
This paper discusses why the current financial funding system for Amtrak doesn’t work and what needs to be changed. The writer claims that Amtrak is doomed to failure, even with government subsidies, if it does not improve service, become more efficient and find ways to increase revenue not just rider-ship. It examines the type of government funding which have been received since the 1970’s and how, in the current economic climate of America, finances of Amtrack need to change.
“Congress initially created Amtrak in 1970 as a for-profit organization, offering national rail service. It was signed into existence in 1971 and to date has never produced a profit. In 1997, Congress’s Amtrak Reform and Accountability Act stipulated that the rail system had to achieve operational sufficiency by the end of 2002 and prohibits Amtrak from using any federal funds for operating expenses after fiscal 2002.”