More than $1 billion. That's what it would cost to restore Amtrak's North Coast Hiawatha route, according to Amtrak's long-awaited feasibility study (PDF) released today. Yikes.
The single largest cost to commence operating the restored North Coast Hiawatha is the cost of upgrading existing track structure, signaling, and grade crossing warning devices. Host railroad carriers have provided preliminary cost estimates covering the capital investments they consider necessary for restored North Coast Hiawatha service that total $619.8 million...
The second largest cost to restore the North Coast Hiawatha will be for acquisition of the necessary locomotives and passenger cars. A projected total of up to 18 locomotives and 54 passenger cars would be required (not including spare equipment to accommodate maintenance and safety requirements), with an estimated purchase cost of $330 million.
And here are the ridership and financial performance projections:
Annual projected ridership on the proposed North Coast Hiawatha service is 359,800 passengers, and projected annual revenue is approximately $43 million. These figures include 65,800 riders who are projected to ride the restored North Coast Hiawatha service instead of the current Empire Builder route, resulting in an estimated $8 million reduction in Empire Builder annual revenue.
Projected direct operating costs are $73.1 million, which would produce a direct operating loss of $31.1 million for the North Coast Hiawatha route and would increase Amtrak’s direct operating loss by $39.1 million annually (when lost revenues on the Empire Builder route are taken into account). Due to high projected ridership, the North Coast Hiawatha’s projected farebox recovery — the percentage of operating costs covered by ticket and food and beverage revenues — is 58%, which is higher than the average farebox recovery (51.8% in FY2008) of Amtrak’s current long distance services.
Much more on this later. To catch up on all the momentum behind the movement to restore the North Coast Hiawatha, check out our April feature "All Aboard."