CNBC Explores: America’s Railroads | CNBC Marathon

CNBC Marathon explores the freight and passenger railroads in America.

The United States lags behind the rest of the world when it comes to passenger trains but when it comes to the freight railroad the U.S. is dominating. The U.S. freight rail network operates over 140,000 miles of privately-owned track in every state except Hawaii, according to the Association of American Railroads. It moves one-third of all U.S. exports and roughly 40% of long distance freight volume. Correction (February 3, 2022): Craig Fuller incorrectly states Amtrak is for-profit but Amtrak is not a for-profit corporation.

Taking a train in the U.S. is often more expensive than flying and more expensive than intercity train systems in other developed countries, which often have even faster trains and better service. But Amtrak, the federally funded company that runs many of America’s passenger trains, has never made money. In fact, the company has a $42 billion repair backlog and in 2021 wasn’t even able to cover half of its expenses from ticket revenue. That business comes mostly from the populous Northeast Corridor, where tickets are quite pricey. Ridership is slowly recovering from an all-time low due to the pandemic, and now Amtrak wants to expand service in a major 15-year plan, with $66 billion in funding from the Bipartisan Infrastructure Law.

The U.S. has no high-speed trains, besides a few small sections of Amtrak’s Acela line in the Northeast Corridor. China has more than 19,000 miles of high-speed rail, the vast majority of which was built in the past decade. Japan’s bullet trains date back to the 1960s. France began service of the high-speed TGV train in 1981 and the rest of Europe quickly followed.

Watch the video to see why the U.S. continues to fail with high-speed trains, and the companies that are trying to fix that.

Chapters:
00:00 — Introduction
00:39 — How freight trains became so successful in the U.S. (Published Feb. 2022)
15:30 — Why train tickets cost so much in America (Published Nov. 2022)
35:39 — Why the U.S. has failed with high-speed rail (Published May 2019)

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CNBC Explores: America’s Railroads | CNBC Marathon

[thegoldstandard]

In the 1800s we had the best rail system in the world. In 2023 we still largely use that same rail system that would be now rated on par with what they have in Africa and South America for derailments, speed and utility.

[HTV-_Hypersonic_Glide_Vehicle]

Remember to all those that say that people that want trains are anti-car, we aren't, we are pro multiple options for choosing what mode of transportation you want.

[charlesrowlet]

People who complain the loudest about any expansion or investment in passenger rail in the U.S. are usually those who have never ridden a train - anywhere in the world. If they ever have, they would be embarrassed for the "greatest country on earth".

[HTV-_Hypersonic_Glide_Vehicle]

In the 1980s Texas proposed a high-speed rail system from Dallas to Houston which would not be expensive, and would allow for future development of city around the train stations. Unfortunately though, Southwest airlines threatened and lied about the project. The project didn't happen. I think the state of Texas would have been a lot better if that project would have happened.

[Koopzilla]

Our freight rail system is only the "largest' and "most profitable" because the freight rail regional monopolies let tracks sit and rot to remain "active" while only capable of supporting very occasional incredibly slow usage. They run dangerously long trains with minimal crew members, typically only 2, in order to maximize profits for the CEOs whilst overworking employees and regularly violating federal passenger train ROW laws. The "efficiency" itself is only in terms of how much goods are moved at once. Everything moves slow and is rarely on time or on schedule. BNSF for example has the worst on time performance of the Class I railroads with not a single freight movement category having being on time above 69%. That's with "on-time" being within 24 hours of schedule.

[weirdfish]

PASSENGER RAIL IS A PUBLIC SERVICE AND DOES NOT HAVE TO BE PROFITABLE. WE’VE SPENT TRILLIONS ON INTERSTATE HIGHWAYS THAT MAKE ZERO CENTS AND ARE MUCH LESS EFFICIENT.

[Puoehlahxiik]

43:08 Japan is not a flat-land... it's as mountainous as California, if not more. When you see Shinkansen routes currently under construction, such as Hokkaido Shinkansen or Chuo Shinkansen, more than 80% of the entire tracks are tunnels.

[Vivek-zwex]

We saw this "world leading" freight rail network in the Palestine, Ohio disaster recently. Of course, the freight rail industry is the most profitable of any in the world. It's easy to be profitable if you stop spending money on safety, maintenance, and pay.

[lizhoward]

Amtrak only owns 3 percent of the tracks?!? That is ridiculous. Well. Maybe Amtrak would make a profit if they had all the supports and subsidies of the airlines and highway interstates. I have no idea how much the states and Federal Government spend on building and maintaining roads, but I have a sneaky feeling if we spent 1/2 that amount on rail, you would see a 180 on rail. Flying is awful with uncomfortable seats, undependable schedules and delays, long security lines, etc. Wouldn’t it be nice to travel by high speed rail instead of flying?

[congruous]

Freight railroad executive says, "The system works." Hahaha! Works for him!

[viceroybolt]

The biggest problem with the US's passenger rail network is, we don't have one. We have passenger cars we can throw on freight trains. The solution to passenger rail isn't to do *anything* to the existing network, it's to aggressively build the one we need, eating up places we used to use for interstate highway expansion. If we can build a highway on it, we can build high speed rail on it.

[KSmit]

I believe the statement made by Craig Fuller at 2:23 is in error. I don't believe Amtrak was ever designed to be a "for-profit railroad." Further, he seems to measure Amtrak's lack of worthiness by in "unprofitability" in all of its years of existence, despite that it never was designed to make money; it was a government bailout, which are hardly ever profitable, for the government, that is.
In fact, to measure profitability to most forms of transportation is a troublesome measure of utility. Is I-95 profitable? Maybe a portion in the middle, like in Delaware, can be run for a profit, but what about the part up in northern Maine? Would an airline be profitable if they had to pay for construction of airports; purchase land, gets permits, build, etc.? Does your local airport make a profit? Would Greyhound be profitable if it had to pay for construction and maintenance of highways? I think it makes more sense to measure a railroads worthiness by its passengers numbers and operation efficiency.

[DejaunWright]

The US, instead of continuing to try to compete, should just buy out some of these railroads. I fail to understand why there is a need for there to even be private rail in the US. Train travel for moving people, products, shipping, etc is so much more efficient.

The US should buy out stock in these railroads to get some more control rather than throwing it's money at new projects likes its been doing.

[jaredpr]

I like how there was a $99 ticket and he chose the expensive one for the Amtrak price comparison

[HTV-_Hypersonic_Glide_Vehicle]

14:26 ah yes, all hail the great shareholders

[coreyhipps]

Something that amuses me is that Brightline in FL recently announced it is already turning a profit in FL with only the three stations.
It's amazing what happens with a shared passenger / freight corridor when scheduling is done so that one is not constantly running at the expense of the other.

Also... fun fact, most intercity trains in Europe share tracks with passenger rail (this is not the case for the LGV lines in France and some of the dedicated high speed line in other countries).
In Japan a lot of intercity and commuting rail is also shared between freight and passenger rail (again, dedicated high speed corridors are separate).

It's not an issue that freight and passenger rail share a right of way per se. It's that they are just all given equal priority in terms of scheduling and the systems are built in such a way to be run on precise time tables (something that anyone who has seen the actual impacts of "precision scheduled railroading" combined with the removal of double tracks and not having long enough passing sidings, etc. will agree does not work).

The US could be a lot better than it is, even without building out a ton of new infrastructure in some places.

And yes, we should build some dedicated high speed corridors as well.

[SIGINT]

PSR is nothing more than a tool to help the stockholders. A two mile long train should not have autonomous operation, nor should they have single person crews.

[captainkeyboard]

I believe that long distance truck driving is not expeditious and is more dangerous than operating freight trains. The train is more reliable, dependable, and does not have sporadic breakdowns as motoring rubber tires on the asphalt street. An automated train can outrun an automatic motor vehicle in durability, as well as mileage.

[nominatorchris]

In a way the privatized system is the reason it's the most profitable. If it was nationalize the government would forego profit in exchange for more service, and better worker conditions. Vs a company would try and squeeze every last drop out of the worker.

[juanmontull]

43:06 Excuse me sir but Spain is europe's second most mountainous country and we built years ago high-speed rail lines on tunneling boring machines. That you can't make it is just another excuse.