America’s passenger railroad said ridership and revenue have declined sharply over the past few weeks in the Northeast Corridor and its national network. The ridership decline is worsening daily, Stephen Gardner, senior executive vice president and chief operating and commercial officer said in a memo to workers Wednesday.
Future bookings are down 50 percent year-over-year in addition to the 300 percent increase in cancellations, Gardner said.
“At this rate, we believe we will likely suffer the loss of several hundred million dollars in revenue during this fiscal year — and we might lose more,” Gardner said.
Amtrak has began “aggressive measures to cut costs,” Gardner said. But it anticipates it will need to do more, including reducing payroll spending.
“You should expect significant reductions in train service across portions of our network in response to the sharp drop in ridership,” Garner said. “Shortly, we will begin rolling out our voluntary leave program for those non-mission critical employees that are willing to take time off on an unpaid basis.”
This week, Amtrak canceled its Acela nonstop service between Washington and New York as demand dropped. The service is suspended through May 26, the company said.
But halting the Acela nonstop service affected on a small fraction of rail travelers in a network of about 300 trains nationwide. That could soon change as Amtrak cuts more service in coming days.
The company has also suspended change fees on all existing and new reservations for tickets purchased before April 30 to accommodate concerned travelers even though there are no coronavirus-related travel restrictions on the carrier.
Like other transportation systems across the country, Amtrak said it also is stepping up cleaning to combat the potential spread of the virus. New protocols include more frequent — in some cases hourly — cleaning of trains and stations, the company said. Amtrak crews are wiping handrails, doorknobs, handles and surfaces, and the company is making hand sanitizer and disinfectant wipes available to passengers and workers aboard trains and in stations.
Gardner said the company is communicating the impact of the coronavirus on Amtrak to the federal government and Congress, which subsidizes the service.
The public health crisis could significantly derail Amtrak’s growth and projections to break both financial and ridership records this fiscal year.
Amtrak carried 32.5 million passengers last year, a record in its 40-year history, and the company inched closer to breaking even in the last fiscal year, reporting its operating revenue rose to $3.3 billion, up by 3.6 percent from the previous year. The revenue growth was expected to lead Amtrak to positive earnings for the first time this year.