Posts Tagged ‘3C’

If you’d like to travel on the Ohio rails with me to Chicago, I’m buying.

When I took my first Amtrak trip in September of 2008 I would have never imagined that I’d be commuting on Amtrak just two years later.   Now, in just a little over two-years time I’ve earned enough points to get a bedroom car for my winter trip through the Rockies to Salt Lake City.

In addition to my regular commutes to and from Chicago/Toledo I’ve ventured to both Washington DC and Minneapolis via Amtrak.  Allow me to add that the route to DC through the Allegheny mountains is simply spectacular.

Over the past couple of years my friends and colleagues have heard me talk about my train trips and some of them started asking questions about how and when one books and travels on Amtrak.  Some of them have taken the time to book trips.

A colleague and his wife booked a sleeper car to Chicago for a long weekend.  Since they were traveling with their young daughter, they found sleeper car accommodations to be perfect for the three of them.  Another couple booked a long weekend in Chicago, but spent the night in Toledo first, thus contributing a little something to Toledo’s economy.  Yet another friend booked a trip from Portland to Seattle while she was on the West Coast.

All of them have eagerly told me how excited they were to be taking their first train rides and equally excited to tell me how much they enjoyed their trips once they returned.

“It’s so convenient.”
“The scenery was beautiful and it was so relaxing.”
“My wife just loved the idea.”
“My eight year old just asked about going for a train ride and I’m thinking about taking the entire family out for the day.”
“It’s so much cheaper than flying.”

This got me thinking more about just how many Ohioans ride the existing Amtrak routes that pass through Ohio.   Toledo has the most boardings of any Ohio train station, and the two other major stops in Ohio are Cleveland and Cincinnati.  However, whether I’m traveling east or west, scores of Ohioans board and disembark at various other stations which include Elyria, Sandusky, and Bryan.

Mind you, Amtrak schedules through Ohio are not that convenient.  The trains travel through the night delivering passengers to Chicago by eleven o’clock in the morning (at the latest), to DC by mid afternoon and to New York and Boston my early evening.  Still, Ohioans make a choice to travel via Amtrak.  Imagine how many more might choose Amtrak if they were to build their schedule around Ohio cities as destinations.

This led me to think that maybe one of the reasons that Ohio’s new governor Mr. John Kasich returned the $400 million in rail funds to the Federal Government is because he’s never traveled through Ohio on a train.  Maybe he thinks that no one rides regular-speed trains because he himself has never thought to try it.

My friends who have chosen to travel on the train absolutely love it, and maybe if John were to jump aboard, he’d like it too.  Maybe he’d like it enough to find another way to fund the expansion of rail through Ohio and create jobs by doing so.  And if that’s the case, I’d like to personally offer to buy John Kasich a round-trip Amtrak ticket to Chicago.

Since I travel out of Toledo often, he’s certainly welcome to ride up to the station with me.  He doesn’t even have to go in half’sies with me on the gas.  The trip is on me.

I’ve thought about the political implications of paying for Ohio’s governor’s train ticket.  Since I didn’t vote for him I don’t think there would be any ramifications for either of us.  And since I won’t be voting for him in the future, it’s not like I’m asking for any type of political favor in return.   But hey, just because I don’t necessarily want to hang out with John Kasich all the time, it doesn’t mean that we can’t be casual friends.  Hell, I’ve paid for other friends to travel with me, so why not John Kasich.

So John, if you’re reading this the invitation is on the table.  If you’d like to travel on the Ohio rails with me to Chicago, I’m buying.  I’ll even pay for breakfast in the dining car.  Have your people get in touch with my people and we’ll coordinate calendars.

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Today’s Chicago Tribune announced that United and Continental airlines have agreed to keep the Cleveland hub open for at least five additional years.

Earlier this month USA Today stated that Delta airlines will reduce it’s regional jet flying by 50% at it’s Cincinnati-Northern Kentucky hub.  Currently Delta’s departures from CVG are down to about 170 flights per day from it’s 2005 high point of 600 daily departures.

Understand that I am not an airline analyst nor an economist, but with a former airline background, I have some insight into this industry.  What happens at these two hubs, Cleveland and Cincinnati, is going to have a long-term impact on the Ohio economy.

The combined United/Continental will have major hubs at the time of the merger in the following cities:  New York, Cleveland, Houston, San Francisco, Los Angles, Denver, Chicago and Washington DC.  Merge the maps and route structures and it’s easy to see that Cleveland becomes rather redundant – sandwiched between New York and Chicago.

Considering Cleveland’s declining population and lack of industry, it’s not difficult to see the fate of that operation, regardless of what the merged company states.  Should the merged company close it’s Cleveland operation it would face a $20 million fine.  That’s not a very large amount and it’s conceivable that a $20 million fine is far less than keeping an operation running that isn’t profitable, if in fact that becomes the case.

Delta’s merger with Northwest created another integrated hub system that includes Los Angles, Salt Lake, Seattle, Cincinnati, Minneapolis, Detroit,  Atlanta, Memphis and New York,  This merged map puts Cincinnati right in the middle of two of it’s largest hubs, Detroit and Atlanta.  Detroit’s economic conditions would seem to make it a logical choice for reduction, but it’s sheer size may give it a certain momentum.  The Cincinnati, hub, however has already been reduced by nearly 60% which will further diminish it’s competitive ability.

Airline hubs bring in lots of money to their associated cities.  Flight attendant, pilot, mechanic and ground crews are based and scheduled from these hubs.  Associated jobs in services sprout up around these airports to support the stop-over traffic.  Hotels, restaurants and car rentals to name a few.  There is also facilities maintenance from outside vendors.  Airline hubs also bring in a Federal funds for runway and taxi way improvements, not to mention construction jobs for terminals, hangers and interchanges.

Airlines operate on economies of scale. Obviously.  Hedging fuel costs offers greater savings when bidding on larger quantities.  Bargaining power with aircraft manufactures is also greater.  And then there are the labor costs to consider and precisely crew scheduling.

Layovers are expensive.  Hotel contracts, down-time, legal rest periods and per-diem accounts for the crews.  An airline’s scheduling department also has to arrange for sick-calls, leave of absences, vacations and missed connections due to late arriving equipment.  The costs associated with crew scheduling can be mitigated when there is a larger pool of crew members to schedule in any one place.

It’s not uncommon for an airline to “deadhead” a crew (fly them as passengers) from one base to another simply for the sake of covering a flight that cannot be properly staffed because of local crew shortages.  Deadheading costs money and time, reducing the crew’s productivity even further.

There were many times when I would deadhead to Atlanta to cover a trip originating 1800 miles away from my home base.  There were also times when I would deadhead from Helsinki to New York because the airline had an obligation to get me home in time to fly my next trip – or be at a further loss again.

So again, economies of scale.  Combining personnel from multiple hubs into one hub creates better staffing options by reducing costs and time.  It makes financial sense for an airline to streamline its operations and the most efficient way to do that is to combine multi-hub resources into one location.

Now, with two mega-carriers (Delta and United) covering the US, Cleveland and Cincinnati become redundant when managing economies of scale.  They’re too close to larger hubs and essentially create little, if any versatility for their associated airlines.

The airline business is playing itself out as it must to survive and it’s outcome will likely impact Ohio economics.  In the mean time the Federal government is offering the State of Ohio funding to create a passenger rail system that some Ohio politicians want to stop.

If Ohio’s Cleveland and Cincinnati airline hubs shut down or are reduced to near-nothing capacity and the State of Ohio does not create a passenger rail system, a tremendous amount of national traffic will simply bypass Ohio completely.

Understand that one new passenger rail line will not outweigh the job losses at two airport hubs.  However, one passenger rail line, a line that starts a larger system, can have an impact on both airports as it connects both Cleveland and Cincinnati.  It is far more economical for an airline to rely upon another method of transportation to get passengers from nearby cities into their hubs than it is to fly them there themselves.

When I was commuting to Cincinnati while working for Delta, I had a choice of about seven or eight daily flights.  Imagine the scheduling requirements of flying an aircraft for less than an hour and less than 200 miles.  It’s also fuel-intensive because the majority of the flight time is spent ascending.

Imagine the savings in labor costs if those same passengers arrived by rail.  Delta would have no costs associated.  Amtrak would, of course, but Amtrak is looking for customers and Amtrak can transport them more efficiently with diesel fuel than an airline can with jet fuel.  Additionally, bringing passengers into a hub city by train reduces air traffic congestion – adding further efficiencies for the airline.

Failure to invest in an Ohio passenger rail system is going to have long-term negative effects for every single resident of Ohio.  Our manufacturing base has been reduced dramatically and it could very well be that our service industry falls next should the airlines begin the true consolidation that is needed to make them profitable.

The airlines have no allegiance to the State of Ohio.  One would expect, however, that it’s politicians would.

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Think with me for a moment…

Let’s say that I want to live in a big house. Well, it doesn’t have to be that big, but what I’d like to have I can’t quite afford – a couple extra rooms and a larger kitchen. Maybe an extra bathroom.

Currently, however, I can only afford something that’s less than I truly want, so I have two choices. Live without a home or buy something that’s affordable and put a little work into it.

Let’s say I chose the latter. With the loan I’m offered I purchase a small house that’ll do for now. It’s practical and does the job – providing shelter as well as offering an investment opportunity.

Over the course of a couple years I spend a little, make some repairs, remodel the existing kitchen and bath. Spruce up the yard. Neighbors walk by and see the work and decided that perhaps they can spruce up their place a little too. Fresh paint, a new porch and maybe some new landscaping.

Then one day, a few years later, I realize that not only is my current home looking better than ever, but the neighborhood has gotten better as well. More people have taken it upon themselves to repair or at least tidy up their homes and yards. It took some work. Not just for me, but for everyone in the neighborhood.

The next year I decide to sell my house and with the profits I’m able to buy a house that’s got more of what I want. It has a bigger kitchen, a second bath and a spare bedroom. I like it! It’s what I dreamed about having for a long time, and had I not purchased my previous home, (and put a little work into it) I’d have not been able to create a profit. In fact, the neighborhood may not have even improved. Essentially, the investment paid off, not just for me, but for my neighbors. They can expect a profit because, over all, the neighborhood improved.

What happened with this theoretical housing model is what can happen with the 3C rail corridor – so long as Ohio politicians decide to, at least invest in a little something. I agree that we’d probably all prefer high-speed trains zipping in and out of town that could carry us to Chicago or New York in a matter of hours. But right now that’s far too expensive.

And sure, expanded rail service in Ohio is going to take some investment. We’ll need train stations, some new switches and we’ll probably start by using some existing equipment. Just like my first house – it’s not perfect, but it’s a start.

And while we live with what we can afford, we add a few more jobs here and there. Our train stations attract a certain amount of attention and maybe some businesses pop up to support those traveling by train. It costs a little to maintain, but it’s an investment. We’re working towards a goal.

A few years later it’s decided to upgrade the tracks and remove some of the grade crossings so that the trains can go faster. New technology allows for improvements that were not possible just a few years earlier. But, because we made the initial investment, we can now capitalize on the existing infrastructure.

Some may think that this is an over-simplified model. Perhaps it is. After all, I can zip to and from Chicago and New York by plane and I don’t have to think about making an investment of my own.

Understand, however, that our airports have not been built by the airlines. And our highways have not been built by the automobile manufactures. Indeed not. Airports and highways are built through federal, state and local funding. These government funded facilities support economic opportunities for the associated communities.

As an example, might Experience Columbus find it difficult to attract conventions if Port Columbus were to shut down? Would our hotels find guests if they could only arrive and depart by automobile? Would our shopping centers and entertainment venues survive if our highways could not bring in visitors? Could UPS deliver your package if our streets didn’t exist?

As a reader, you may never ride one of the 3C trains. Or maybe you will. But as a resident of Columbus, and as a resident of Ohio, you’ll receive tangible benefits by having this city connected to a national passenger rail system.

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