Seeker Blog

“Nobody in the world makes money hauling passengers,” he said. “There are no passenger train operations in the world that sustain themselves with the money they get selling tickets.”

Here’s a fascinating interview with railroad exec Pete Claussen, chairman of Knoxville-based Gulf & Ohio Railways Inc.

….Though many observers deride Amtrak’s financial record, it is actually one of the most successful rail systems in the world, recouping 75 percent to 80 percent of its operating expenses through revenues, Claussen said. Remaining expenses, as with most all rail systems, have to be subsidized.

Next, there has to be a Point A and a Point B, each with sufficient population density and demand for travel between the two. He used the example of a railroad to the Great Smoky Mountains.

“This is why a rail to the Smokies won’t work,” he said. “You’ve got B - you’ve got the Smokies- but you don’t have A, because people come there from everywhere,” he said.

And then, there is the “bus test.”

“Let’s suppose you have A and B, which is Knoxville to the (McGhee Tyson) airport,” Claussen observed.

Many people want to get from one destination to the other, so would a rail link succeed?

No, according to Claussen, because there is no regular bus service between Knoxville and the airport and that would come first.

“If you can’t support a bus, you can’t support a train,” he said.

The issue is about public transportation and there must be more of a willingness for people to try public transportation, whether a bus or a train, before passenger rail will succeed, he said.

Rising fuel, food and other costs may push people in that direction, but Claussen doesn’t think the traveling public is there yet. At least not judging by the bus test. On a recent trip to Roanoke, Va., he said the lanes were clogged with thousands of cars and trucks, “but I didn’t see one bus.”

Claussen speaks as a railroad industry insider, running a company established in 1985 that owns eight railroads across the Southeast. Most of them haul freight, but one is the Three Rivers Rambler excursion train that runs from downtown Knoxville along Fort Loudoun Lake to the Marbledale Quarry.