The issue with passenger rail in the U.S. is that there is a glaring double standard when it comes to costs and expectations. Is a trucking company responsible for the construction of the roads the products would be delivered on? What about Uber and Lyft? Or any bus service. They get to use the roads that are paid for and heavily subsidized by the government. What about airlines. Did Delta have to build the airport, the runways, air traffic control, etc.? No. They get to use the subsidized infrastructure provided by the government. Yet a company like Brightline is expected to build and maintain a rail line to use. Or they have to work out a deal with another company that had to build and maintain its on rail line. I think it is time we level the playing field. It is time the federal government becomes responsible for building and maintaining rail lines. They can lease space to the companies that use them much the same way an airport would charge for gate space, charge landing fees, and how the government charges a gas tax to help pay for roads. Notice I didn't say to pay for roads since the tax revenue isn't enough to cover the cost.
This is why the model that appeared in Britain, then in continental Europe, of a publicly owned network of lines, dispatching, stations, etc. but private as well as public operators of trains is a good one. Important services can be subsidized when necessary, and profitable services can be operated by private companies, benefiting their customers and shareholders.
@@JohnGeorgeBauerBuis After seeing how Germany's rail has declined since it was privatized, I'd really want limitations. Like the company should get zero control over the infrastructure. DB has done so much wrong in favor of their bullet train. They've gutted important routes and sold off assets they'll never be able to replace. They have problems with punctuality and the cleanliness of stations. They've sacrificed a lot in the name of profit. Private companies should be able to rent track time/station time, but that is it. Once you give them too much control, consumers will pay the price. That will be true whether the consumers are travelers or shippers. Privatization usually means paying more and getting less and looting the company to pay executives becomes job one.
Some railroads in the past were given land grants (Union Pacific, Illinois Central, Northern Pacific et al.), so it isn't a stretch that it could happen again.
Without significant government investment, I don't think comprehensive intercity rail travel can be profitable. Particular routes could be, so we might see "paired cities" as a moneymaker (e.g. Omaha to Kansas City, Chicago to Minneapolis, Dallas to Houston, etc.). Intercity rail service is so successful in Europe because of geography and substantial government investment, as those governments have seen a comprehensive system of public transportation as being a service the government should provide. It will be interesting to see how things progress with Brightline.
Grants, not really. It's a weird way the highway departments are funded. No road construction can be paid for by private money, the budget comes from the state alone.
@@tonyburzio4107 Brightline was awarded grants by the Federal Railroad Administration for construction in California and Nevada. Nothing to do with highways, which are funded 80% by the Federal Highway Administration through state departments of transportation.
@@godzilladc The point is, I think, that the government funds some part of the operations of highways, railways, and airplanes because it is in the public interest to have these. In Europe ... no, let me rephrase that, as generalizations over all of Europe are always problematic. In Germany, the states put out tenders for regional rail service for particular packets of lines for the next several years, requiring particular levels of service, ticket prices, and so on. They typically pay for tracks and stations and sometimes for the trains, too; private entities (including some owned by the formerly non-private federal railway that is still federally owned) make offers for these,, and the best gets the contract. On the other hand, most long-distance rail is still done by the feds, though there is one private operator and a few trains from the neighbors. Freight rail is the same basic system as long-distance passenger rail, except there are many more private operators. The tracks themselves are mostly - again, with some exceptions - owned by a division of the federal railways, though there are some ideas about re-nationalizing that part and handling it more like roads. It is generally thought that (passenger) rail works better in Austria than Germany, and better in Switzerland than Austria. And per-capita investment in railroads is higher in Austria than in Germany, and in Switzerland than in Austria. I think I can see a pattern here ...
Another well-produced look at history, and the future. I wish Brightline well, and I'll be keeping a close eye on the Los Angeles to Las Vegas run they will begin building soon!
One point left out: Revenue from high end cruise ship passengers. There is significant traffic that can be tapped into here, especially travelers from countries that are used to using passenger trains to get around.
Brightline just partnered with Princess Cruises. You'll be able to buy your train ticket and it'll even include checked bagged from your train station right to your room suite. I can see this becoming very popular.
Yes, I met several passengers from England on the train, they are used to driving on the left side of the road so if they’re taking the train to a cruise line, then they don’t have to have stress driving on the right side of the road.
Given the similar rolling stock, I wouldn't be surprised at all of their eventual goal is to turn it over to Amtrak as a state supported service - Amtrak Brightline in a similar operation as Amtrak Cascades, taking advantage of the still extant law that allows them to pass the service to the NRPC at basically any time. The lack of electrification despite having the money to do it along the routes makes it pretty clear they're not in this for the long term profitability of the rail service, as that's one common feature of every profitable intercity rail service, Amtrak or otherwise.
Most of the route follows an active freight right-of-way, so overhead catenary lines would not work. Brightline West will follow Interstate 15 and be electrified.
@@gregory596 Double Stack containers fit under the wires of the NEC, and there's no tunnel clearances to worry about, the FEC should be electrified as a result.
all your assumptions are not going to happen. and you need to educate yourself why brightline in florida has no electrification. Brightline west will be fully electrified, brightline flordia already brings 2 billion extra revenue each year to the state of california.
The Cocoa station is a great profit potential. Orlando tourists will be able to Take a beach day trip See a Spacex launch Add a 3 day cruise All without having to rent a car, sit in traffic, and look for parking
There are many thousands of people moving to Florida every year and many of them, of course moved to Orlando and southern Florida. The toll road is always becoming more congested from Orlando to the mega cities of West Palm, Fort Lauderdale and Miami. I have enjoyed taking the train from Orlando three times and I’m taking it for the fourth time with the friend next month. Very comfortable and I can talk to my friend and read my e-book and also I take my own drinks and snacks on the train.
sounds good, so once you reach stations, how do you get around? Get second cars, third cars, car rental, uber? HSR works well in other countries because of the state art of public transportation. Without state of art public transportation, Brightline will not work. I just don't understand why HSR supporters keep bringing Japan as an example of HSR, but they will never bring state of the art public transportation in Japan. Oh, the most successful HSR is Shinkansen from Tokyo to Osaka. The population density is much higher. Other HSR lines are not as successful, and the population density are higher n public transportation is better than Florida.
I've ridden Brightline round trip, Miami to Orlando, twice now...and on both trips the train was full. I don't know enough about the economics of this business to speculate on the long term, but people are riding these trains! I read just the other day they are ordering additional cars as demand is exceeding supply at the moment. And, by the way, the ride is extremely comfortable and pleasant. Whether it's faster than flying or driving isn't the point. It's a better ride.
You are so right! I’m seeing posts from friends in FL who have never traveled by train before who are adopting Brightline in lieu of their cars. And they are loving it!
Excellent video and very solid information. I work for a property development company in South Florida and let me tell you that Brightline has been a game changer in the real estate market here especially in downtown Miami with Miam Central, in downtown Fort Lauderdale and downtown West Palm Beach. The train trip is almost incidental compared to the vast real estate development opportunities in the downtown areas along the line.
It is an interesting business model, one that very clearly is history repeating itself. In the end, there are more benefits than drawbacks. - private investment creates the infrastructure - public investment will keep it operating
What a great video. I am impressed by your understanding of the big, real estate picture. Too many people do not take the time to understand what is really happening . I do believe that Brightline will be a profitable rail road. Gen Z hates cars and loves trains. They are the future, God help us! 😊
I’m not Gen Z , but I also would rather ride in a train then have gigantic stress driving on the toll road. So far I enjoyed riding Brightline three times, Orlando to Southern Florida.
The private model is decent for building infrastructure , as somehow the funding is more abundant (still needs government aid) and there is less red tape. However, like you said as soon as there is no money to be had, the private model falls apart and the state or federal government needs to step in and run the service. Passenger transportation is an interesting paradox, as it is essential, but almost never profitable. That way, I think since it's a public service, it should ultimately be run by the public. It does not need to make a profit. Thanks for this great video!
One benefit brightline might have over the older railroads with reguards to ticket revenue is that prices won't have to be regulated by the old Interstate Commerce Commission. Quick tldr it was set up in the 1880s to try and curb railroads from charging extortionary rates or using the standard oil playbook of selling your service at a loss to drive your competitor out of business, but this stayed in place until the 1990s, long after the peak of railroads power. Good example of this is when the auto train was operating under a private corporation, there are a lot of reasons it went under despite being profitable in its first few years, but one of the main ones was after 1978 airlines became deregulated and began offering dirt cheap flights on that route, and everytime auto train wanted to lower their fares to try and keep up, they had to petition the ICC to do so which took around 3-4 months. The STB still technically regulates passenger fares but in a ruling from years ago they determined that brightline wasn't under their jurisdiction because they didn't cross state lines, but this hurdle might happen brightline west if/when it starts operation
This is so simple, it's really frustrating that 'transit advocates' can't understand this. Fun fact, most air routes and seats don't make money and cruise lines don't make their money on fares either. Brightline can't go away (including being run into the ground by the Government) because it's the reason RE values are high.
Wrong. The Brightline route is a double track rail line between Miami and Cocoa. Cocoa to Orlando is single track, but it's only a relatively short distance.
@@Shytot-1 WRONG AGAIN. If a railroad has a standard 100 foot wide right-of-way with two adjacent, parallel main tracks, it is a double track railroad, whether it is primarily freight, exclusively freight, or exclusively passenger, i.e., high speed rail or higher speed rail. Brightline utilizes Florida East Coast Railway's double track main line between Miami Central Station and Cocoa, and its own dedicated single track line between Cocoa and Orlando Airport, which has a maximum speed limit of 125 mph (FRA Class 7). If you doubt what I'm saying, please explain your contrary position, specifically, what do you mean by "one up and one down". Thank you.
@@michaeljones7927 In the UK an Up line is typically the line that travels towards a major city or destination, while a Down line travels away from it. Up Fast line Up Slow line Down Fast line Down Slow line is a set of four running lines. Fast lines are there to run express trains, unfortunately, Brightline does not have a Fast line so it will not have an express train. Overtaking loops can also be provided on dual track lines, typically at stations, for the purpose of providing a location for express trains to overtake local trains. In the UK express trains rarely stop between centres, say London to Manchester or in the case of Brightline, Orlando to Miami.
I certainly hope Brightline keeps running and makes a comeback for trains since I sure hate driving from Orlando to Fort Lauderdale, West Palm and Miami ! Traffic on the toll road is terrible in Florida, southern Florida
The ridership is not low, they just say the ridership forecast is slashed. They are short on Siemens Venture coaches. The original plan was supposed to be 7 coaches for the Orlando opening, it only opened with 4 because Siemens Mobility is very busy with Amtrak orders right now. All station platforms are designed to accommodate 10 coach passenger trains (which is 7-8 million riders per year at current frequency). The current run away number is roughly 3-4 million passengers this year. This makes it rival the Acela Express ridership already within 1 year of operation to Orlando If Brightline increases frequency to 30 minutes with 10 coach trains due to high demand, the ridership will be 16 million passengers. This will far exceed the ridership of the Northeast Regional. This can happen, due to Brightline's future access to three big cruise terminals (Cocoa, Fort Lauderdale, and Miami). When Brightline connects to Tampa with the theme park connections, it will have even more ridership. People will no longer need to rent a car (ignoring price arguments) in order to enjoy travelling in Florida.
most local lines dont turn a profit in europe, except the main lines wich finances the local lines. Wich is ok, this is a service wich european governments deem neccessary for people to get around the country. Not everyone can and or want to drive a car. Imagine all those people sitting in a train, where all owning a car, and would be driving on the road, making roads more congested, heavier loads on the roads, wich makes it much more expensive to maintain and to keep up with it. It is not about profits by ticket sales, but for the whole economy in general. Wich is what most people dont want or cant understand.
One historical footnote that was the final nail in the coffin killing intercity passenger rail: the USPS. Up until 1967/1968 most mail was carried and sorted on long distance passenger trains. The post office provided enough revenue to cover the trains' operating costs. After 1968, all long distance mail moves via Air Mail. Prior to the that April was an optional, service. I remember when regular first class mail was six cents; Air Mail was eight cents. Interestingly enough the inspector general, who overseas Amtrak finances, has recommend that Amtrak consider haul mail and express on the NEC. The post office has declined.
You are very correct. And some trains that had really poor passenger ridership stayed active only because of the mail and express contract. I touch on Amtrak's foray into mail and express a little bit in this video. Check it out if you have time on any interest. th-cam.com/video/D7BlB0iNkpA/w-d-xo.htmlsi=sIOw8kVhHe8LTbqh
0:22 I certainly don’t remember any news stories predicting profitability for Brightline; it wasn’t a secret that it was a long-term real estate play, to which the choo choo was incidental. Also, those headlines are all from before the Orlando extension opened.
Oh there were plenty! Mostly from news outlets who didn’t really do a lot of their own research and were working off press releases and PR. Who knows, maybe I will be proven wrong and it will be profitable. I’m not going to hold my breath though. Haha
All European passenger rail (except UK) is subsidized by the government. Whether you spend it building Interstate highways, or subsidize passenger train service… you need government support either way.
You’re very correct. A lot of people, especially in this country, don’t appreciate how much roads, airports and ship ports are subsidized as well. Yet rail subsidies seem to receive the most scrutiny.
With hopefully good management more stations can be built along the line and expand real estate for a long time to come if Florida ecconomy continues to grow .
So you build a 50 storey mixed use building. Without an elevator you will have no tenants. The elevator is a necessary expense to make the building viable. You do not overindulge on the elevator nor do you have more than what is necessary. Then the government regulates how you operate and maintain your elevator controlling how much you spend. Then they build another elevator in your building and charge the tenants extra for using it. But it has extra capacity and they don't mind the extra expense. Ultimately the government assumes ownership of all the elevators. The tenants still pay rent AND pay the ever-increasing costs of all the elevators. Brightline is the horizontal elevator.
If the profitable sections that Amtrak operates on, namely the North East Corridor were offered up for private operation, i think they would still be private. The reason that hasnt happened is because it is a package deal with the network in the rest of the country. Brightline has been smart in that they know how limited their scope can be and if they can use realestate to bear the initial expenses and build the areas around their line to the a stable state of operating revenue, the spectre of switching over to public ownership wont even be in the question.
What about private railways in Japan that have a mix of rail, real estate, and other businesses, and keep this mix of trains and property development/managment going for decades? And what about profitable intercity and high speed operations in Europe? Once the orginal debt of the construction of Brightline is paid off, ticket revenues should be enough to make it profitable, as it's the initial billions in debt of construction that cause privately financed HSR in Britain and Taiwan to require a public bailout. It's like airlines and trucking companies having to retire the debt of airport and highway construction in a decade... even in the 19th Century railroads often went bankrupt before being reorganized into profitable ventures.
There are so many approaches to high speed rail all around the world. I have a basic understanding of how it works in the UK and in some other European countries. I have basically no understanding about how railways work in Japan. That is very high on my travel list though and would love to learn more! :)
I am also keeping an eye on any Brightline extension to the Universal/ Disney areas. This could further solidify Brightline as a major transporter in the area. It has been a few years since I have been in the Disney area. I have heard they are continually expanding I-4 and traffic is still bad. This could prove to be very lucrative for Brightline - maybe even creating direct investment from the theme parks themselves.
I really hope that gets built as well. I also just learned they are considering an extension from Miami central to the cruise port. That would be a huge deal!
Last I heard, and this very well could be out dated info, is Brightline to Disney isn't happening because Disney demanded that they only go to park and not Universal which Brightline didn't have any interest in, so decided on an alternate route. If only they had like a magical bus that could ferry people from the airport to the Disney resorts...
@@enjoystraveling That's pretty fantastic, and would have been a much better sell by Chapek to say "a city bus cost $2 and runs to Disney Springs which you can take Disney buses to whatever resort you're going to" rather than saying "well Uber exists". Now sure some people want to go directly to their hotel, but it's not like the train if it went there would go to each resort on the Disney property either.
@@Mike__B I believe you can also take one of the free Disney boats to some of their hotels from Disney Springs and check up on that if it’s still true. I’ve taken the two dollar buses at least two or three times from the airport international Drive and to SeaWorld transferring on the free trolley
I think what many miss is that the country and the economy are rapidly changing. For example, the U.S. will overtake the EU in population by 2050. Governments can’t continue to support auto centric transportation and development models (sprawl doesn’t pay for itself), and the cost of car ownership is exploding. With housing costs also rising and population increasing. something has to give. That means denser neighborhoods and more transit oriented developments. The issue of profitability is irrelevant because rail contributes to sustainable, economic development and more than pays for itself. Like with all other modes which are all dependent on government support, rail passenger service probably will be as well.
I agree and highways can’t constantly be adding lanes, more traffic just comes and then you need to add more lanes. Look at Houston Texas for an example of this.
How are Westbahn, Regiojet, Leo Express, Snälltåget, MTRX, ntv, Flixtrain and European sleeper making money running passenger trains without owning tracks? How could their business model be applied to the United States?
Basically those carriers profit BECAUSE they don't have to bear the major burden of right-of-way ownership and maintenance. The governments/taxpayers eat the cost providing the actual railways.
@@kennethhanks6712 They profit from having fast infrastructure (which has been built with public money). The Westbahn in Austria is found on the country's fastest line which has been upgraded before. Likewise Italy's ntv uses the high speed lines of FS Italiane. They pay for each use which means running a train can only be possible above a certain number of passengers on board, empty trains will have the same fixed cost but make a loss.
History teaches that what killed early rail development was the government - not the lack of real estate opportunities. The US government heavily subsidized other forms of travel, and less dense forms of development that directly hurt the rail+land model. No rail project will ever solely depends on ticket sales - look at the Japanese Rail example, MTR etc
They are profitable if you only consider operating costs of the trains and not the railroad as a whole. If you take into account the maintenance of the tracks and infrastructure as well, then the Northeast Corridor is absolutely not profitable.
This is a pretty good explanation of what I was saying…. cs.trains.com/trn/b/fred-frailey/archive/2011/05/13/is-the-northeast-corridor-really-profitable.aspx
What everyone forgets is that even back in the 1890s when there was zero alternative to passenger rain travel the service was still barely profitable with many lines. Cargo rail service made the majority of their profits outside of selling the land around the track they laid down. When the land was all sold it was no longer a factor. Once trucks and the interstate gave an alternative to rail the railroads could no longer afford to offer the service.
I hope Brightline becomes profitable. I live in Northern Michigan and I would love to be able to get on a high speed train near my house and go to the Carolinas where I have family or Florida.
All transport modes need public spending and whilst I don't think railways should be built or kept running just for the sake of it there is no railway in the world that is profitable to run the calculation has to be made as to whether a mass transit system that a railway is, is more cost effective than building and maintaining miles and miles of freeway and when these get congested more and more the huge expense of adding an extra lane and landing this to a crazy extent is the better option. We had this discussion here in the UK 30 years ago when railways were privatised, franchised out to private companies, it failed miserably. Private businesses have to make a profit, have to pay shareholders, have to raise investment, and to be honest I don't want government involved in anything more than they have to, but i personally think in the end railways should be fun by non profit businesses or ones like those in Germany or France, by Deutsche Bahn or SNCF (I know in these countries there are more providers but in applying the model to the US until you have a network I think you have to start here), so companies with expertise running things with very little to no involvement by politicians (who don't know what they're doing). I just can't believe that government money is being given to Brightline West to build a private railway. If it was a loan at a beneficial interest rate then fine but if you're not careful money will be leached out of the system and people running the company will make a lot of money just from money paid to them. If the Florida operation uses increases in land or property prices to build its railway and rinse and repeats this then fine, and eventually the coats of running it aren't sustainable and it is brought into being a part of Amtrak then fine, but I just don't see private railways being profitable in the long term (unless you remove the costs of maintaining the railway and the rolling stock).
Thank you for all of this info! I have always been intrigued by how things are done in the UK. I plan on filming there later this year and am very much looking forward to learning more!
I'm surprised at how short the trains are in compare to European trains! The ICE 1 has between 9 and 12 coaches, the TGV has 8 shorter coaches! But 4 is really not much! So earn money with passenger tickets is limited compare to Europe. But i think there is a lot of potential, with longer trains and good development there will be a chance to be profitable.
@@RailWeekly The common myth is that trains are old technology. Perhaps, but they can provide an essential service and an alternative to bus service and driving for hours. But minds shut down after agreeing on my first sentence.
I really wanted to take a trip on brightline. The persons working their parking lot was rude. Supposedly have to have a special transponder to park in their lot. No offer of other help. Can't carry anything sharp etc for fear. Keep your train.
Public transit infrastructure shouldn't be thought of as a profit making enterprise. It should be thought of as a public service like police, fire, K-12 education, and the military. Roads don't pay for themselves either. They are a public service unless it's a private toll road.
Roads pay for themselves by the billions of dollars of cargo that are carried on them. They are the lifeblood of the economy. Everything you buy at your local stores gets there by highway. Trains are a joke!
@@povertyspec9651 And of course without roads, just imagine where would US economy be, without being able to funnel trillions of dollars to Lockheed, Ratheon, Northrop, et al., who “pay for themselves” as the only remaining “lifeblood” of the US economy by protecting our interests in overseas oil for road transportation.
@@povertyspec9651 I always hear this goofy argument as if passenger rail doesn't promote economic growth, provide equity, increase health benefits by reducing sedentary lifestyles, and climate-friendly options..
@@povertyspec9651My brother in Christ a good 70% of cross-country cargo IS HAULED BY TRAIN. Trains are literally the most efficient way of moving goods. This has been proven time and time again.
Well, the next project at Bright line is planning makes so much sense that it might make money just from ridership… If they can successfully get a high-speed train to work from the eastern edges of Los Angeles County out to Las Vegas?? there is so much money to be made on both sides of the equation here that it might actually be able to pay for itself just on rail tickets! The drive is that bad!!
I have been on Brightline from Orlando to West Palm in Orlando to Fort Lauderdale, and it was full at least in the smart class, which is basically a economy. Maybe you were looking at premium, which is usually less full
So you are saying the feds should start a government-owned development arm that develops land around future HSR stations to get the services up and running...
Not quite. I’m very much a fan of the private sector having a role in developing rail corridors (and they should make money off it too!) Government projects are notoriously slow and difficult compared to what Brightline has done. My video is merely an attempt to understand the true economics of what goes on to make things like this happen.
I hope you don't mind me poking holes in your story. First, Brightline separated its real estate from the passenger train company, so depriving bondholders of that revenue source would be fraud. Second, they lease station property and don't own any airspace. Third, you mention the sales price of the building but leave out the basis. I don't think the net profit puts a dent in the deficit of operating costs.
I don't mind at all. Thank you for these points. It's quite a complicated endeavor. I'm excited to see what happens in regards to real estate with their Brightline West project as well!
According to the2024 February monthly report, Brightline has doubled its revenue. They are able to break even in 2024 in operating profit. But the interest rate is high, so it is still a long way from positive cash flow and positive net profit.
That's wonderful news! Thank you for sharing. I can't wait to see how Brightline grows. I hope they add that proposed stop in Miami at the cruise terminal.
@@RailWeekly As I expected, the latest March report claim they are EBITDA positive for the month. Earnings before Interest, Taxes, Depreciation, and Amortization.
Like your video man. I think that every transport company should be owned by then government essentially since it already gives tax dollars to those companies anyways for the most part. Privatizing passengers rail, from what I’ve seen, has not been successful thus far.
Thank you very much! And I agree. Other countries where rail transport is semi-privatized seems to be quite chaotic. It’s truly a public service and should be treated as such. Thank you for watching!
The only profitable railway I can see in the future is high speed rail from LA to Las Vegas. Lord knows it won’t be California’s low speed rail to nowhere.
The federal government needs to purchase ROWs from freight railroad companies via Eminent Domain and use them primarily for passenger rail service. Freight railroad companies have too much power in the USA. It's the main reason our train passenger service is terrible compared to Europe and Asia.
Imagine if we let billionaires own the interstate highway system. Imagine how mad people would be about having to pay every time they drive anywhere for anything. Why the fuck do we let them privatize rail then?
The main problem with this is that you basically giveaway public assets to private companies so they can make tons of money just and than dumps it back on the public. It will be far more economical for a country to invest it's own money in the first place than give almost for free it's assets for a short time "gain"that only makes the rich richer and the rest of the country poorer. As always, you've created this problem and instead of fixing it you try to "bypass" it this enshrining the problem and making it worst. And the worst part is that you don't do it with roads or air travel, just with rail. Here what you should do, and are apparently incapable of doing: national the rail infrastructure. Invest in it, improve it, electrify it, add high speed lines, urban transit and start catching up with the rest of the world. Make this network open for all like road but in the form flights, which is more similar to trains, by making the network open access where private companies can operate trains by paying for slots and subsidizing less profitable routs. That said, if you insist that there is no other way the government must insist that in return of public funds and assets the private companies must have liabilities for those services, like minimum service requirements, like providing consistent service, not just when it's profitable (so no trains only on peak hours or shutting down service completely for 18 months while government transit agency keeps providing service) and financial compensation if they decide they made enough money and than dump it for the public to pick up the pieces.
@@rapunzel1701 You mean the federal government did not grant railroad companies tens of Million of acres and thousands of miles of rights of way across public lands? And today they don't get federal grants, tax exemptions and development rights without any kind of commitment from them to provide and maintain constant passenger service? Does Brightline has any obligation to continue providing service once they get enough money from their property?
@@AL5520 Without getting into the whole 'stolen lands' quagmire...history. Of course there's no obligation to continue service. Why waste societal resources?
Brightline was built with private money on an historically private rail route, meeting a private demand. It has already stimulated billions of dollars in new investment and development, which continually produce financial returns to government coffers, along with other immeasurable public benefits. Government will mismanage and waste most of this revenue, using much of it to restrict, undermine and punish the producers of that wealth. Socialism is slavery.
The main reason the Brightline isn't profitable is because it doesn't offer a a cost savings and it doesn't save you traveling time. I can drive from Orlando to Miami as fast or faster depending on traffic cheaper, or i can take a 30 minute plane ride from MCO to MIA for $100. There is no incentive to take it. What they should have done was create a bullet train that traveled at average speeds of 150+ MPH like they have in Japan. Get me from Orlando to Miami in 1.5 hours and people will buy tickets. The government doesn't have to subsidize anything
Thank you. I think you’re confusing Florida East Coast Railways and Florida East Coast Industries. The railway was spun off in 2017, correct. But in the video I only mentioned that Fortress bought FECI in 2007 (which at that time DID include the railway as well). And Fortress still does own FECI. I hope that helps!
This is a problem of the neoliberal political ideology that’s been highly prevalent in America since the Reagan era, where profitability is the primary or even sole measure of the value of a public service, irrespective of the societal or economic benefits it provides. This is why you see such strident resistance to government investment in public transportation projects and advocacy of silly ideas like fixing public education by privatizing it. Related to that is a culture of selfishness in America, where people only want to see government investment in projects that they personally plan to use. So the same people who bitterly oppose a new light rail, heavy rail or passenger rail service won’t utter a single complaint about road or airport construction that also costs taxpayers money. The whole reason we have such bad public transportation in America in the first place is because the government chose to invest in road and air transportation while shortchanging rail.
You are very correct. There are so many things working against new transportation projects in this country. Hopefully reviving this private approach to some of this development will help to create some new trains for us!
Brightline runs a route that is more expensive and less convenient than driving. In most cases it's not as fast either, especially door to door - it's not high speed rail only reaching about 120MPH for a short leg of the journey. They are already hitting up local governments to build stations for them. They have never met their own ridership projections - not even close. They are nowhere near being profitable.. Don't confuse a general boom in South Florida real estate values due to massive business and resident migration into the state and area with the property being near a Brightline station as a reason for increased values. The Brightline bondholders don't and won't benefit from Fortresses other investment successes, and if Brightline goes under they are SOL. IMHO, next station for the Ghost Train is Bankruptcy, or as you said gov't subsidies and bailouts (but this is low tax Florida).
I don't think anyone would ever describe driving on I-95 to Miami or I-4 through Orlando as convenient. It's true that Brightline is not a high-speed train. It is more similar to a European regional train such as the RE1 in Germany. Brightline is substantially more convenient than Amtrak, which runs two trains per day in Florida. One goes south in the morning. The other goes north in the evening. (I actually think they're both the same train)
@@gregory596 That is the problem. Unlike high-speed trains, European regional trains require subsidies to operate, even as they benefit from much better infrastructure than Brightline.
"Less convenient than driving".. A silly comment and essentially makes the rest of your post worthless. Your car journey from Orlando to Miami can easily be 4-4.5 hours. West Palm Beach to Miami can be 2-2.5 hours itself. Your journey will be affected by traffic due to rush hour, weather, accidents, construction, or just the sheer number of cars on the road. The train will make its journey rain or shine, rush hour or not. While on the train the person can sleep, eat, drink (alcohol if they so choose), work, walk around, go use the bathroom, or just sit and take in the views as they cruise between 79-125 MPH. Upon arrival they'll be far more revived/relaxed than the person who's just sat in a cramped car for hours. It's common knowledge at this point that Brightline does increase property value around its stations. Trying to say otherwise again just makes your post look more worthless.
@@Ven100 First of all speed includes door to door. Unless you live next to the station and are going to the Orlando airport, you have additional ground travel on both ends. Second, Brightline has a pedestrian or vehicle accident once a week That closes the line down for hours. Third the Turnpike runs diagonally from WPB to ORL - that's less mileage than Birghtline's L route. A 100 mile stretch of the TPK has only one exit in the middle, so traffic is rare and speeds easily exceed 80 MPH. As for walk around, bathrooms (the drive is well under 3 hours) and drinking - that's personal taste, but it comes at a price in money and time.
Fun fact: If Brightline was an Amtrak corridor, it would be the third busiest in the nation behind the NEC services and the Surfliner; also not to mention the WPB to Miami route earned its first, albeit unintentional, operational PROFIT. “Ghost train” my foot.
There is no railway culture in US because government's promoted Road and Airport's. System is built in a way discourages to bring new trains Private railways doesn't work in every country but Japan is an exception Train ticket rates are in between Road and Airport's price with minimum speed 200 kmph There is an marketing and aspirations to bring new trains and new routes but there is no ground reality to make it happen
Passenger rail will never be profitable. They are too labor and personnel intensive to satisfy any feduciary growth requirement. Brightline will need a proper Amtrak name.
I thought the purpose of Brightline was to encourage people to travel via train from South Florida to Orlando. I’ve seen videos comparing it to air travel. Now they are adding more stops along the way? Trains lose to planes again.
Keep in mind that Brightline runs local AND express services. They made “commuter” trains that serve Aventura and Boca Raton as well as the three major cities - Miami, Fort Lauderdale, and West Palm Beach. So, maybe these local trains would serve the stations between West Palm Beach and Orlando
Check the number of people using Brightline per day between Orlando and S FL and you'll see that Brightline numbers blow airline passenger numbers out of the water.. They can add extra stops and still offer express trains that don't stop at every station. It should also be mentioned that a stop only adds 5 minutes to the total journey time, we know this because not every Brightline train stops at Boca Raton.
Pie, In, the, Sky. As mentioned by yourself. Its all about financial strategy and much about being viable, which it is not. But hey a lot of dept based capital will be mined by this gold digging operation.
It's because the infrastructure is owned by the government and they lease track access to private companies. That's the opposite in the USA, where the vast majority of track is privately owned by freight companies that lease to Amtrak for passenger service. Even Brightline leases most of the track they use from freight railroad companies.
Perhaps not. But perhaps if we all think of projects like these from every angle, we can find new ways to make projects like these be successful and get even more of them built! :-)
Real estate is not going to be the means for Brightline's future success. It will succeed only if it can generate enough revenue to cover operating and maintenance costs and then amortize its investment in infrastructure and equipment, after paying off the bonds that have partially financed the project. Henry Flagler did NOT use real estate to make the Florida East Coast Railway a success. He used the FEC Railway to develop the East Coast of Florida, especially the Miami area, and to facilitate tourism when passenger trains were the only viable means of intercity travel. There is no evidence Fortress Investment Group has any plans to use Brightline for large scale real estate development. Moreover, they DON'T NEED BRIGHTLINE TO DO THAT. Any real estate project they undertake will have to succeed on its own merit because there is no real symbiotic relationship between intercity rail and real estate. Urban eail transit is an entirely different matter. It can both stimulate and facilitate densification in large cities, resulting in large scale real estate developments. The assertion that Brightline needs real estate to be financially viable is rooted in a liberal bias against private sector infrastructure projects and a preference for government ownership and operation. Amtrak is the latter and is anything but a success.
These passenger rail activists ignore the fact that these trains are a nineteenth century technology. We are in the 21st century now. We have cars, highways, airplanes and buses that are cheaper and more efficient than passenger trains. Even famous trains like the Japanese Shinkansen lost so much money after it was established that the system was privatized in order to cut, but not eliminate, its massive losses.
I moved out of shithole Stuart just so I don't have to listen to non stop horns blaring all day and evening long. I could see inside the trains passing by at night and they were almost empty.
That's interesting that you think this video is bashing rail. I think it's quite the opposite... showing how being resourceful and thinking outside the box will get MORE rail projects built. Please elaborate if you don't mind. I would love to hear more of your thoughts. And thank you for watching!
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The issue with passenger rail in the U.S. is that there is a glaring double standard when it comes to costs and expectations. Is a trucking company responsible for the construction of the roads the products would be delivered on? What about Uber and Lyft? Or any bus service. They get to use the roads that are paid for and heavily subsidized by the government. What about airlines. Did Delta have to build the airport, the runways, air traffic control, etc.? No. They get to use the subsidized infrastructure provided by the government. Yet a company like Brightline is expected to build and maintain a rail line to use. Or they have to work out a deal with another company that had to build and maintain its on rail line. I think it is time we level the playing field. It is time the federal government becomes responsible for building and maintaining rail lines. They can lease space to the companies that use them much the same way an airport would charge for gate space, charge landing fees, and how the government charges a gas tax to help pay for roads. Notice I didn't say to pay for roads since the tax revenue isn't enough to cover the cost.
Only way you sell that to the government, is to make it a matter of national security, like the highways
This is why the model that appeared in Britain, then in continental Europe, of a publicly owned network of lines, dispatching, stations, etc. but private as well as public operators of trains is a good one. Important services can be subsidized when necessary, and profitable services can be operated by private companies, benefiting their customers and shareholders.
@@JohnGeorgeBauerBuis After seeing how Germany's rail has declined since it was privatized, I'd really want limitations. Like the company should get zero control over the infrastructure. DB has done so much wrong in favor of their bullet train. They've gutted important routes and sold off assets they'll never be able to replace. They have problems with punctuality and the cleanliness of stations. They've sacrificed a lot in the name of profit. Private companies should be able to rent track time/station time, but that is it. Once you give them too much control, consumers will pay the price. That will be true whether the consumers are travelers or shippers. Privatization usually means paying more and getting less and looting the company to pay executives becomes job one.
Do they cause an increase in already crowded ares ? Briteline certainly does with zero benefit to the average person.
Some railroads in the past were given land grants (Union Pacific, Illinois Central, Northern Pacific et al.), so it isn't a stretch that it could happen again.
Without significant government investment, I don't think comprehensive intercity rail travel can be profitable. Particular routes could be, so we might see "paired cities" as a moneymaker (e.g. Omaha to Kansas City, Chicago to Minneapolis, Dallas to Houston, etc.). Intercity rail service is so successful in Europe because of geography and substantial government investment, as those governments have seen a comprehensive system of public transportation as being a service the government should provide. It will be interesting to see how things progress with Brightline.
Well, Brightline West has been awarded Federal grants for construction.
@@godzilladc I'm glad someone pointed this out.
Grants, not really. It's a weird way the highway departments are funded. No road construction can be paid for by private money, the budget comes from the state alone.
@@tonyburzio4107 Brightline was awarded grants by the Federal Railroad Administration for construction in California and Nevada. Nothing to do with highways, which are funded 80% by the Federal Highway Administration through state departments of transportation.
@@godzilladc The point is, I think, that the government funds some part of the operations of highways, railways, and airplanes because it is in the public interest to have these. In Europe ... no, let me rephrase that, as generalizations over all of Europe are always problematic. In Germany, the states put out tenders for regional rail service for particular packets of lines for the next several years, requiring particular levels of service, ticket prices, and so on. They typically pay for tracks and stations and sometimes for the trains, too; private entities (including some owned by the formerly non-private federal railway that is still federally owned) make offers for these,, and the best gets the contract. On the other hand, most long-distance rail is still done by the feds, though there is one private operator and a few trains from the neighbors. Freight rail is the same basic system as long-distance passenger rail, except there are many more private operators. The tracks themselves are mostly - again, with some exceptions - owned by a division of the federal railways, though there are some ideas about re-nationalizing that part and handling it more like roads.
It is generally thought that (passenger) rail works better in Austria than Germany, and better in Switzerland than Austria. And per-capita investment in railroads is higher in Austria than in Germany, and in Switzerland than in Austria. I think I can see a pattern here ...
Love Brightline, beats sitting in traffic each and every day. Beautiful experience!
It really is!
Why don't you move closer to where you work
@@yourgooglemeister6745 why? We have Brightline 🤦♂️
It's a train and trains are nice.
Another well-produced look at history, and the future. I wish Brightline well, and I'll be keeping a close eye on the Los Angeles to Las Vegas run they will begin building soon!
Thank you! Yes! That will be very exciting to see if it comes to fruition out west!
Bright Line West started construction in April 2024.
One point left out: Revenue from high end cruise ship passengers. There is significant traffic that can be tapped into here, especially travelers from countries that are used to using passenger trains to get around.
Brightline just partnered with Princess Cruises. You'll be able to buy your train ticket and it'll even include checked bagged from your train station right to your room suite. I can see this becoming very popular.
They are also supposed to extend the tracks from Miami to a station next to where the cruise ships dock.
Yeah! I recently learned that they are trying to add a stop in Miami and the cruise terminal. I also saw that press release from Princess. So smart!!
Yes, I met several passengers from England on the train, they are used to driving on the left side of the road so if they’re taking the train to a cruise line, then they don’t have to have stress driving on the right side of the road.
Given the similar rolling stock, I wouldn't be surprised at all of their eventual goal is to turn it over to Amtrak as a state supported service - Amtrak Brightline in a similar operation as Amtrak Cascades, taking advantage of the still extant law that allows them to pass the service to the NRPC at basically any time. The lack of electrification despite having the money to do it along the routes makes it pretty clear they're not in this for the long term profitability of the rail service, as that's one common feature of every profitable intercity rail service, Amtrak or otherwise.
Most of the route follows an active freight right-of-way, so overhead catenary lines would not work. Brightline West will follow Interstate 15 and be electrified.
@@gregory596 Double Stack containers fit under the wires of the NEC, and there's no tunnel clearances to worry about, the FEC should be electrified as a result.
all your assumptions are not going to happen. and you need to educate yourself why brightline in florida has no electrification. Brightline west will be fully electrified, brightline flordia already brings 2 billion extra revenue each year to the state of california.
Florida will never allow the feds to take over, they detest them. Florida has plenty of money to subsidize Brightline.
@@lexburen5932How does Brightline Florida bring anything to California?
The Cocoa station is a great profit potential. Orlando tourists will be able to
Take a beach day trip
See a Spacex launch
Add a 3 day cruise
All without having to rent a car, sit in traffic, and look for parking
I think you may have just planned my next vacation! haha
Or we can stop developing, creating the congestion we are spending even more on to 'solve'.
There are many thousands of people moving to Florida every year and many of them, of course moved to Orlando and southern Florida.
The toll road is always becoming more congested from Orlando to the mega cities of West Palm, Fort Lauderdale and Miami. I have enjoyed taking the train from Orlando three times and I’m taking it for the fourth time with the friend next month. Very comfortable and I can talk to my friend and read my e-book and also I take my own drinks and snacks on the train.
sounds good, so once you reach stations, how do you get around?
Get second cars, third cars, car rental, uber?
HSR works well in other countries because of the state art of public transportation.
Without state of art public transportation, Brightline will not work.
I just don't understand why HSR supporters keep bringing Japan as an example of HSR, but they will never bring state of the art public transportation in Japan.
Oh, the most successful HSR is Shinkansen from Tokyo to Osaka. The population density is much higher.
Other HSR lines are not as successful, and the population density are higher n public transportation is better than Florida.
Wait for pricing to catch up to costs, you'll see a drop in ridership. Unfortunately.
I've ridden Brightline round trip, Miami to Orlando, twice now...and on both trips the train was full. I don't know enough about the economics of this business to speculate on the long term, but people are riding these trains! I read just the other day they are ordering additional cars as demand is exceeding supply at the moment. And, by the way, the ride is extremely comfortable and pleasant. Whether it's faster than flying or driving isn't the point. It's a better ride.
You are so right! I’m seeing posts from friends in FL who have never traveled by train before who are adopting Brightline in lieu of their cars. And they are loving it!
Excellent video and very solid information. I work for a property development company in South Florida and let me tell you that Brightline has been a game changer in the real estate market here especially in downtown Miami with Miam Central, in downtown Fort Lauderdale and downtown West Palm Beach. The train trip is almost incidental compared to the vast real estate development opportunities in the downtown areas along the line.
Thank you for sharing this. I appreciate it!
This train is changing Florida in a good way, so regardless, it's going to stay.
I hope you are correct! Once people get used to the convenience, it will be difficult to take it away!
It is an interesting business model, one that very clearly is history repeating itself.
In the end, there are more benefits than drawbacks.
- private investment creates the infrastructure
- public investment will keep it operating
What a great video. I am impressed by your understanding of the big, real estate picture. Too many people do not take the time to understand what is really happening . I do believe that Brightline will be a profitable rail road. Gen Z hates cars and loves trains. They are the future, God help us! 😊
Thank you so much! I'm not Gen Z, but I also loathe cars haha
I’m not Gen Z , but I also would rather ride in a train then have gigantic stress driving on the toll road. So far I enjoyed riding Brightline three times, Orlando to Southern Florida.
no we dont loathe cars. Thats just you
The private model is decent for building infrastructure , as somehow the funding is more abundant (still needs government aid) and there is less red tape. However, like you said as soon as there is no money to be had, the private model falls apart and the state or federal government needs to step in and run the service. Passenger transportation is an interesting paradox, as it is essential, but almost never profitable. That way, I think since it's a public service, it should ultimately be run by the public. It does not need to make a profit. Thanks for this great video!
One benefit brightline might have over the older railroads with reguards to ticket revenue is that prices won't have to be regulated by the old Interstate Commerce Commission.
Quick tldr it was set up in the 1880s to try and curb railroads from charging extortionary rates or using the standard oil playbook of selling your service at a loss to drive your competitor out of business, but this stayed in place until the 1990s, long after the peak of railroads power. Good example of this is when the auto train was operating under a private corporation, there are a lot of reasons it went under despite being profitable in its first few years, but one of the main ones was after 1978 airlines became deregulated and began offering dirt cheap flights on that route, and everytime auto train wanted to lower their fares to try and keep up, they had to petition the ICC to do so which took around 3-4 months.
The STB still technically regulates passenger fares but in a ruling from years ago they determined that brightline wasn't under their jurisdiction because they didn't cross state lines, but this hurdle might happen brightline west if/when it starts operation
You make some very interesting points that I had not seen. You are correct that as a revenue tickets alone will not pay for the service. Great video.
Thank you very much. Here's hoping that Brightline is a huge success no matter what.
This is so simple, it's really frustrating that 'transit advocates' can't understand this. Fun fact, most air routes and seats don't make money and cruise lines don't make their money on fares either.
Brightline can't go away (including being run into the ground by the Government) because it's the reason RE values are high.
The more stations to stop at, the slower the train, you can't add faster trains because it only has one track.
Wrong. The Brightline route is a double track rail line between Miami and Cocoa. Cocoa to Orlando is single track, but it's only a relatively short distance.
@@michaeljones7927 One up one down is not a double track
@@Shytot-1 WRONG AGAIN. If a railroad has a standard 100 foot wide right-of-way with two adjacent, parallel main tracks, it is a double track railroad, whether it is primarily freight, exclusively freight, or exclusively passenger, i.e., high speed rail or higher speed rail. Brightline utilizes Florida East Coast Railway's double track main line between Miami Central Station and Cocoa, and its own dedicated single track line between Cocoa and Orlando Airport, which has a maximum speed limit of 125 mph (FRA Class 7). If you doubt what I'm saying, please explain your contrary position, specifically, what do you mean by "one up and one down". Thank you.
@@michaeljones7927 In the UK an Up line is typically the line that travels towards a major city or destination, while a Down line travels away from it. Up Fast line Up Slow line Down Fast line Down Slow line is a set of four running lines. Fast lines are there to run express trains, unfortunately, Brightline does not have a Fast line so it will not have an express train. Overtaking loops can also be provided on dual track lines, typically at stations, for the purpose of providing a location for express trains to overtake local trains. In the UK express trains rarely stop between centres, say London to Manchester or in the case of Brightline, Orlando to Miami.
@@Shytot-1 Thanks for your response to my comment.
I certainly hope Brightline keeps running and makes a comeback for trains since I sure hate driving from Orlando to Fort Lauderdale, West Palm and Miami ! Traffic on the toll road is terrible in Florida, southern Florida
The ridership is not low, they just say the ridership forecast is slashed. They are short on Siemens Venture coaches. The original plan was supposed to be 7 coaches for the Orlando opening, it only opened with 4 because Siemens Mobility is very busy with Amtrak orders right now. All station platforms are designed to accommodate 10 coach passenger trains (which is 7-8 million riders per year at current frequency). The current run away number is roughly 3-4 million passengers this year. This makes it rival the Acela Express ridership already within 1 year of operation to Orlando
If Brightline increases frequency to 30 minutes with 10 coach trains due to high demand, the ridership will be 16 million passengers. This will far exceed the ridership of the Northeast Regional. This can happen, due to Brightline's future access to three big cruise terminals (Cocoa, Fort Lauderdale, and Miami). When Brightline connects to Tampa with the theme park connections, it will have even more ridership. People will no longer need to rent a car (ignoring price arguments) in order to enjoy travelling in Florida.
In Europe and Japan, passenger trains generally don’t turn a profit and rely on government help if not ownership. It seems inevitable here in the USA…
It seems like the US might be moving in the right direction. Only time will tell. 🤞🏻
most local lines dont turn a profit in europe, except the main lines wich finances the local lines. Wich is ok, this is a service wich european governments deem neccessary for people to get around the country. Not everyone can and or want to drive a car. Imagine all those people sitting in a train, where all owning a car, and would be driving on the road, making roads more congested, heavier loads on the roads, wich makes it much more expensive to maintain and to keep up with it. It is not about profits by ticket sales, but for the whole economy in general. Wich is what most people dont want or cant understand.
Spot on.
One historical footnote that was the final nail in the coffin killing intercity passenger rail: the USPS. Up until 1967/1968 most mail was carried and sorted on long distance passenger trains. The post office provided enough revenue to cover the trains' operating costs. After 1968, all long distance mail moves via Air Mail. Prior to the that April was an optional, service. I remember when regular first class mail was six cents; Air Mail was eight cents.
Interestingly enough the inspector general, who overseas Amtrak finances, has recommend that Amtrak consider haul mail and express on the NEC. The post office has declined.
You are very correct. And some trains that had really poor passenger ridership stayed active only because of the mail and express contract. I touch on Amtrak's foray into mail and express a little bit in this video. Check it out if you have time on any interest. th-cam.com/video/D7BlB0iNkpA/w-d-xo.htmlsi=sIOw8kVhHe8LTbqh
0:22 I certainly don’t remember any news stories predicting profitability for Brightline; it wasn’t a secret that it was a long-term real estate play, to which the choo choo was incidental. Also, those headlines are all from before the Orlando extension opened.
Oh there were plenty! Mostly from news outlets who didn’t really do a lot of their own research and were working off press releases and PR. Who knows, maybe I will be proven wrong and it will be profitable. I’m not going to hold my breath though. Haha
Awesome video! Thanks 😄
My pleasure! Thank you for watching.
Excellent points! A great video.
Thank you so much!
All European passenger rail (except UK) is subsidized by the government. Whether you spend it building Interstate highways, or subsidize passenger train service… you need government support either way.
You’re very correct. A lot of people, especially in this country, don’t appreciate how much roads, airports and ship ports are subsidized as well. Yet rail subsidies seem to receive the most scrutiny.
Even UK rail, throughout the privatization period, was not free of subsidy. The track operator also went bankrupt and had to be renationalized.
With hopefully good management more stations can be built along the line and expand real estate for a long time to come if Florida ecconomy continues to grow .
You're video's are excellent! So informative. Very much appreciated. 😊
Thank you so much! I appreciate the encouragement.
So you build a 50 storey mixed use building. Without an elevator you will have no tenants. The elevator is a necessary expense to make the building viable. You do not overindulge on the elevator nor do you have more than what is necessary. Then the government regulates how you operate and maintain your elevator controlling how much you spend. Then they build another elevator in your building and charge the tenants extra for using it. But it has extra capacity and they don't mind the extra expense. Ultimately the government assumes ownership of all the elevators. The tenants still pay rent AND pay the ever-increasing costs of all the elevators. Brightline is the horizontal elevator.
This is a REALLY great way to look at it! Makes so much sense.
That analogy was used around ten years ago when Brightline was first proposed.
@@johnhblaubachea5156 You're welcome. (It was 12 years ago.)
If the profitable sections that Amtrak operates on, namely the North East Corridor were offered up for private operation, i think they would still be private. The reason that hasnt happened is because it is a package deal with the network in the rest of the country.
Brightline has been smart in that they know how limited their scope can be and if they can use realestate to bear the initial expenses and build the areas around their line to the a stable state of operating revenue, the spectre of switching over to public ownership wont even be in the question.
It’s really going to be very interesting to see how it all works out! I will be watching closely as well.
I live in the Daytona area I can now fly out of Orlando airport with a short drive to cocoa beach . And so can about 1,000,000 other people.
Yes! This will make large parts of FL so much more accessible now!
What about private railways in Japan that have a mix of rail, real estate, and other businesses, and keep this mix of trains and property development/managment going for decades? And what about profitable intercity and high speed operations in Europe? Once the orginal debt of the construction of Brightline is paid off, ticket revenues should be enough to make it profitable, as it's the initial billions in debt of construction that cause privately financed HSR in Britain and Taiwan to require a public bailout. It's like airlines and trucking companies having to retire the debt of airport and highway construction in a decade... even in the 19th Century railroads often went bankrupt before being reorganized into profitable ventures.
There are so many approaches to high speed rail all around the world. I have a basic understanding of how it works in the UK and in some other European countries. I have basically no understanding about how railways work in Japan. That is very high on my travel list though and would love to learn more! :)
I am also keeping an eye on any Brightline extension to the Universal/ Disney areas. This could further solidify Brightline as a major transporter in the area.
It has been a few years since I have been in the Disney area. I have heard they are continually expanding I-4 and traffic is still bad. This could prove to be very lucrative for Brightline - maybe even creating direct investment from the theme parks themselves.
I really hope that gets built as well. I also just learned they are considering an extension from Miami central to the cruise port. That would be a huge deal!
Last I heard, and this very well could be out dated info, is Brightline to Disney isn't happening because Disney demanded that they only go to park and not Universal which Brightline didn't have any interest in, so decided on an alternate route. If only they had like a magical bus that could ferry people from the airport to the Disney resorts...
@@Mike__B there’s a city bus at Orlando airport that only cost two dollars approximately to international Drive in many other places.
@@enjoystraveling That's pretty fantastic, and would have been a much better sell by Chapek to say "a city bus cost $2 and runs to Disney Springs which you can take Disney buses to whatever resort you're going to" rather than saying "well Uber exists". Now sure some people want to go directly to their hotel, but it's not like the train if it went there would go to each resort on the Disney property either.
@@Mike__B I believe you can also take one of the free Disney boats to some of their hotels from Disney Springs and check up on that if it’s still true.
I’ve taken the two dollar buses at least two or three times from the airport international Drive and to SeaWorld transferring on the free trolley
Brightline main enticement is going from A to B quickly without a car, and at a very low price. But A & B must be places people want or need to go to.
I think what many miss is that the country and the economy are rapidly changing. For example, the U.S. will overtake the EU in population by 2050. Governments can’t continue to support auto centric transportation and development models (sprawl doesn’t pay for itself), and the cost of car ownership is exploding. With housing costs also rising and population increasing. something has to give. That means denser neighborhoods and more transit oriented developments. The issue of profitability is irrelevant because rail contributes to sustainable, economic development and more than pays for itself. Like with all other modes which are all dependent on government support, rail passenger service probably will be as well.
I agree and highways can’t constantly be adding lanes, more traffic just comes and then you need to add more lanes. Look at Houston Texas for an example of this.
How are Westbahn, Regiojet, Leo Express, Snälltåget, MTRX, ntv, Flixtrain and European sleeper making money running passenger trains without owning tracks? How could their business model be applied to the United States?
Basically those carriers profit BECAUSE they don't have to bear the major burden of right-of-way ownership and maintenance. The governments/taxpayers eat the cost providing the actual railways.
They have to pay a solid fee for driving their trains over these tracks.
@@kennethhanks6712 They profit from having fast infrastructure (which has been built with public money). The Westbahn in Austria is found on the country's fastest line which has been upgraded before. Likewise Italy's ntv uses the high speed lines of FS Italiane. They pay for each use which means running a train can only be possible above a certain number of passengers on board, empty trains will have the same fixed cost but make a loss.
History teaches that what killed early rail development was the government - not the lack of real estate opportunities. The US government heavily subsidized other forms of travel, and less dense forms of development that directly hurt the rail+land model.
No rail project will ever solely depends on ticket sales - look at the Japanese Rail example, MTR etc
This is all very true! And railroads were also very highly regulated compared to other forms of travel… especially as it related to pricing.
Acela is profitable, maybe Surfliner as well? Aren't those the more relevant comps than just "Amtrak"?
They are profitable if you only consider operating costs of the trains and not the railroad as a whole. If you take into account the maintenance of the tracks and infrastructure as well, then the Northeast Corridor is absolutely not profitable.
This is a pretty good explanation of what I was saying…. cs.trains.com/trn/b/fred-frailey/archive/2011/05/13/is-the-northeast-corridor-really-profitable.aspx
What everyone forgets is that even back in the 1890s when there was zero alternative to passenger rain travel the service was still barely profitable with many lines. Cargo rail service made the majority of their profits outside of selling the land around the track they laid down. When the land was all sold it was no longer a factor.
Once trucks and the interstate gave an alternative to rail the railroads could no longer afford to offer the service.
That is very true. And even the passenger trains themselves made money by carrying cargo (mail and express).
2:03 - As featured in the movie "North By Northwest"
Great train movie!
So ... Brightline basically doing a pump and dump scheme?
I hope Brightline becomes profitable. I live in Northern Michigan and I would love to be able to get on a high speed train near my house and go to the Carolinas where I have family or Florida.
All transport modes need public spending and whilst I don't think railways should be built or kept running just for the sake of it there is no railway in the world that is profitable to run the calculation has to be made as to whether a mass transit system that a railway is, is more cost effective than building and maintaining miles and miles of freeway and when these get congested more and more the huge expense of adding an extra lane and landing this to a crazy extent is the better option.
We had this discussion here in the UK 30 years ago when railways were privatised, franchised out to private companies, it failed miserably. Private businesses have to make a profit, have to pay shareholders, have to raise investment, and to be honest I don't want government involved in anything more than they have to, but i personally think in the end railways should be fun by non profit businesses or ones like those in Germany or France, by Deutsche Bahn or SNCF (I know in these countries there are more providers but in applying the model to the US until you have a network I think you have to start here), so companies with expertise running things with very little to no involvement by politicians (who don't know what they're doing).
I just can't believe that government money is being given to Brightline West to build a private railway. If it was a loan at a beneficial interest rate then fine but if you're not careful money will be leached out of the system and people running the company will make a lot of money just from money paid to them. If the Florida operation uses increases in land or property prices to build its railway and rinse and repeats this then fine, and eventually the coats of running it aren't sustainable and it is brought into being a part of Amtrak then fine, but I just don't see private railways being profitable in the long term (unless you remove the costs of maintaining the railway and the rolling stock).
Thank you for all of this info! I have always been intrigued by how things are done in the UK. I plan on filming there later this year and am very much looking forward to learning more!
I'm surprised at how short the trains are in compare to European trains! The ICE 1 has between 9 and 12 coaches, the TGV has 8 shorter coaches! But 4 is really not much! So earn money with passenger tickets is limited compare to Europe. But i think there is a lot of potential, with longer trains and good development there will be a chance to be profitable.
Airlines and highways "lose money" as well, and require public investment. Rail travel has been a culture wars pawn since the Reagan era.
Yeah! I wonder why that is. No one is up in arms about the new airport terminals being built everywhere or new lanes of highway…
@@RailWeekly The common myth is that trains are old technology. Perhaps, but they can provide an essential service and an alternative to bus service and driving for hours. But minds shut down after agreeing on my first sentence.
Conservative politicians would privatize everything if they had their way.
I really wanted to take a trip on brightline. The persons working their parking lot was rude. Supposedly have to have a special transponder to park in their lot. No offer of other help. Can't carry anything sharp etc for fear.
Keep your train.
Public transit infrastructure shouldn't be thought of as a profit making enterprise. It should be thought of as a public service like police, fire, K-12 education, and the military. Roads don't pay for themselves either. They are a public service unless it's a private toll road.
Roads pay for themselves by the billions of dollars of cargo that are carried on them. They are the lifeblood of the economy. Everything you buy at your local stores gets there by highway. Trains are a joke!
@@povertyspec9651 And of course without roads, just imagine where would US economy be, without being able to funnel trillions of dollars to Lockheed, Ratheon, Northrop, et al., who “pay for themselves” as the only remaining “lifeblood” of the US economy by protecting our interests in overseas oil for road transportation.
@@povertyspec9651 I always hear this goofy argument as if passenger rail doesn't promote economic growth, provide equity, increase health benefits by reducing sedentary lifestyles, and climate-friendly options..
@@povertyspec9651My brother in Christ a good 70% of cross-country cargo IS HAULED BY TRAIN. Trains are literally the most efficient way of moving goods. This has been proven time and time again.
@@povertyspec9651Furthermore, roads don’t “pay for themselves” through cargo; not gas taxes either.
AND. THEY. NEVER. WILL.
I will keep driving, keep your trains.
Well, the next project at Bright line is planning makes so much sense that it might make money just from ridership… If they can successfully get a high-speed train to work from the eastern edges of Los Angeles County out to Las Vegas?? there is so much money to be made on both sides of the equation here that it might actually be able to pay for itself just on rail tickets! The drive is that bad!!
Brightline West will be true high speed rail and all electric.
It's always empty every time I see one passing
That is perhaps not a good sign. It's still early days though.
I have been on Brightline from Orlando to West Palm in Orlando to Fort Lauderdale, and it was full at least in the smart class, which is basically a economy.
Maybe you were looking at premium, which is usually less full
Good job. If all the free stuff for Premium ticket riders hasn't disappeared, it soon will. Along with price increases.
Thank you! Sounds like I better try out that premium service before it’s too late! Haha
@@RailWeekly I bought a $22 special ticket from Orlando to Miami although it’s not premium, but I can take my own snacks
So you are saying the feds should start a government-owned development arm that develops land around future HSR stations to get the services up and running...
Not quite. I’m very much a fan of the private sector having a role in developing rail corridors (and they should make money off it too!) Government projects are notoriously slow and difficult compared to what Brightline has done. My video is merely an attempt to understand the true economics of what goes on to make things like this happen.
Brightline is on track to be EBITDA positive this year, so the end of this video (which implies it will need to become a public service) is incorrect.
It’s really too early to say. I didn’t make a conclusion so much as just wondering about the future. I’m excited to see how this unfolds! :-)
I hope you don't mind me poking holes in your story. First, Brightline separated its real estate from the passenger train company, so depriving bondholders of that revenue source would be fraud. Second, they lease station property and don't own any airspace. Third, you mention the sales price of the building but leave out the basis. I don't think the net profit puts a dent in the deficit of operating costs.
I don't mind at all. Thank you for these points. It's quite a complicated endeavor. I'm excited to see what happens in regards to real estate with their Brightline West project as well!
They have to get more bums on seats & putting up prices won't do that it has the opposite effect . There aren't many railways that run at a profit .
According to the2024 February monthly report, Brightline has doubled its revenue. They are able to break even in 2024 in operating profit. But the interest rate is high, so it is still a long way from positive cash flow and positive net profit.
That's wonderful news! Thank you for sharing. I can't wait to see how Brightline grows. I hope they add that proposed stop in Miami at the cruise terminal.
@@RailWeekly As I expected, the latest March report claim they are EBITDA positive for the month. Earnings before Interest, Taxes, Depreciation, and Amortization.
Depend on who will be the next President in 2025 may not invest anymore
Privatize profits now and socialize inevitable losses later -- why SAYS America doesn't lead the way anymore!
Haha! Why change now??
Like your video man. I think that every transport company should be owned by then government essentially since it already gives tax dollars to those companies anyways for the most part. Privatizing passengers rail, from what I’ve seen, has not been successful thus far.
Thank you very much! And I agree. Other countries where rail transport is semi-privatized seems to be quite chaotic. It’s truly a public service and should be treated as such. Thank you for watching!
I live in Europe and socialism doesn't work dude..The EU has been stagnated for decades...
1:28 No, it won't. But it will try its heart out!
Here's hoping!
8:10 - More Government by necessity is always a bad thing...
The only profitable railway I can see in the future is high speed rail from LA to Las Vegas. Lord knows it won’t be California’s low speed rail to nowhere.
It’ll be a similar formula as with Miami to Orlando. You have tourist & residents that can’t or don’t wanna drive to tourist destinations.
The federal government needs to purchase ROWs from freight railroad companies via Eminent Domain and use them primarily for passenger rail service. Freight railroad companies have too much power in the USA. It's the main reason our train passenger service is terrible compared to Europe and Asia.
Passenger train network is an unprofitable money pit..We have the same problem in Spain but bigger by magnitudes...🙄
Imagine if we let billionaires own the interstate highway system. Imagine how mad people would be about having to pay every time they drive anywhere for anything.
Why the fuck do we let them privatize rail then?
The main problem with this is that you basically giveaway public assets to private companies so they can make tons of money just and than dumps it back on the public.
It will be far more economical for a country to invest it's own money in the first place than give almost for free it's assets for a short time "gain"that only makes the rich richer and the rest of the country poorer. As always, you've created this problem and instead of fixing it you try to "bypass" it this enshrining the problem and making it worst. And the worst part is that you don't do it with roads or air travel, just with rail. Here what you should do, and are apparently incapable of doing: national the rail infrastructure. Invest in it, improve it, electrify it, add high speed lines, urban transit and start catching up with the rest of the world. Make this network open for all like road but in the form flights, which is more similar to trains, by making the network open access where private companies can operate trains by paying for slots and subsidizing less profitable routs.
That said, if you insist that there is no other way the government must insist that in return of public funds and assets the private companies must have liabilities for those services, like minimum service requirements, like providing consistent service, not just when it's profitable (so no trains only on peak hours or shutting down service completely for 18 months while government transit agency keeps providing service) and financial compensation if they decide they made enough money and than dump it for the public to pick up the pieces.
Or, exchange part of the company ownership to the government for the federal grants they receive.
"giveaway public assets to private companies" This did not happen.
@@rapunzel1701 You mean the federal government did not grant railroad companies tens of Million of acres and thousands of miles of rights of way across public lands?
And today they don't get federal grants, tax exemptions and development rights without any kind of commitment from them to provide and maintain constant passenger service? Does Brightline has any obligation to continue providing service once they get enough money from their property?
@@AL5520 Without getting into the whole 'stolen lands' quagmire...history.
Of course there's no obligation to continue service. Why waste societal resources?
Brightline was built with private money on an historically private rail route, meeting a private demand. It has already stimulated billions of dollars in new investment and development, which continually produce financial returns to government coffers, along with other immeasurable public benefits. Government will mismanage and waste most of this revenue, using much of it to restrict, undermine and punish the producers of that wealth. Socialism is slavery.
The main reason the Brightline isn't profitable is because it doesn't offer a a cost savings and it doesn't save you traveling time. I can drive from Orlando to Miami as fast or faster depending on traffic cheaper, or i can take a 30 minute plane ride from MCO to MIA for $100. There is no incentive to take it. What they should have done was create a bullet train that traveled at average speeds of 150+ MPH like they have in Japan. Get me from Orlando to Miami in 1.5 hours and people will buy tickets. The government doesn't have to subsidize anything
Great video. Very Informative. One BIG FACT error though. Fortress does NOT own FEC. FEC is owned by Groupo Mexico Transportes.
Thank you. I think you’re confusing Florida East Coast Railways and Florida East Coast Industries. The railway was spun off in 2017, correct. But in the video I only mentioned that Fortress bought FECI in 2007 (which at that time DID include the railway as well). And Fortress still does own FECI. I hope that helps!
This is a problem of the neoliberal political ideology that’s been highly prevalent in America since the Reagan era, where profitability is the primary or even sole measure of the value of a public service, irrespective of the societal or economic benefits it provides. This is why you see such strident resistance to government investment in public transportation projects and advocacy of silly ideas like fixing public education by privatizing it.
Related to that is a culture of selfishness in America, where people only want to see government investment in projects that they personally plan to use. So the same people who bitterly oppose a new light rail, heavy rail or passenger rail service won’t utter a single complaint about road or airport construction that also costs taxpayers money.
The whole reason we have such bad public transportation in America in the first place is because the government chose to invest in road and air transportation while shortchanging rail.
You are very correct. There are so many things working against new transportation projects in this country. Hopefully reviving this private approach to some of this development will help to create some new trains for us!
Real estate isn't its only means. Also lets see how revenue is when it reaches Tampa and the they make a station in Cocoa to serve the Space Coast.
Brightline runs a route that is more expensive and less convenient than driving. In most cases it's not as fast either, especially door to door - it's not high speed rail only reaching about 120MPH for a short leg of the journey. They are already hitting up local governments to build stations for them. They have never met their own ridership projections - not even close. They are nowhere near being profitable.. Don't confuse a general boom in South Florida real estate values due to massive business and resident migration into the state and area with the property being near a Brightline station as a reason for increased values. The Brightline bondholders don't and won't benefit from Fortresses other investment successes, and if Brightline goes under they are SOL. IMHO, next station for the Ghost Train is Bankruptcy, or as you said gov't subsidies and bailouts (but this is low tax Florida).
I don't think anyone would ever describe driving on I-95 to Miami or I-4 through Orlando as convenient. It's true that Brightline is not a high-speed train. It is more similar to a European regional train such as the RE1 in Germany.
Brightline is substantially more convenient than Amtrak, which runs two trains per day in Florida. One goes south in the morning. The other goes north in the evening. (I actually think they're both the same train)
@@gregory596 That is the problem. Unlike high-speed trains, European regional trains require subsidies to operate, even as they benefit from much better infrastructure than Brightline.
"Less convenient than driving".. A silly comment and essentially makes the rest of your post worthless.
Your car journey from Orlando to Miami can easily be 4-4.5 hours. West Palm Beach to Miami can be 2-2.5 hours itself. Your journey will be affected by traffic due to rush hour, weather, accidents, construction, or just the sheer number of cars on the road. The train will make its journey rain or shine, rush hour or not. While on the train the person can sleep, eat, drink (alcohol if they so choose), work, walk around, go use the bathroom, or just sit and take in the views as they cruise between 79-125 MPH. Upon arrival they'll be far more revived/relaxed than the person who's just sat in a cramped car for hours.
It's common knowledge at this point that Brightline does increase property value around its stations. Trying to say otherwise again just makes your post look more worthless.
@@Ven100 First of all speed includes door to door. Unless you live next to the station and are going to the Orlando airport, you have additional ground travel on both ends. Second, Brightline has a pedestrian or vehicle accident once a week That closes the line down for hours. Third the Turnpike runs diagonally from WPB to ORL - that's less mileage than Birghtline's L route. A 100 mile stretch of the TPK has only one exit in the middle, so traffic is rare and speeds easily exceed 80 MPH. As for walk around, bathrooms (the drive is well under 3 hours) and drinking - that's personal taste, but it comes at a price in money and time.
Fun fact: If Brightline was an Amtrak corridor, it would be the third busiest in the nation behind the NEC services and the Surfliner; also not to mention the WPB to Miami route earned its first, albeit unintentional, operational PROFIT.
“Ghost train” my foot.
There is no railway culture in US because government's promoted Road and Airport's.
System is built in a way discourages to bring new trains
Private railways doesn't work in every country but Japan is an exception
Train ticket rates are in between Road and Airport's price with minimum speed 200 kmph
There is an marketing and aspirations to bring new trains and new routes but there is no ground reality to make it happen
I would love to learn more about Japanese railways. That is certainly a fascinating history there.
Passenger rail will never be profitable. They are too labor and personnel intensive to satisfy any feduciary growth requirement. Brightline will need a proper Amtrak name.
I thought the purpose of Brightline was to encourage people to travel via train from South Florida to Orlando. I’ve seen videos comparing it to air travel. Now they are adding more stops along the way? Trains lose to planes again.
Keep in mind that Brightline runs local AND express services. They made “commuter” trains that serve Aventura and Boca Raton as well as the three major cities - Miami, Fort Lauderdale, and West Palm Beach. So, maybe these local trains would serve the stations between West Palm Beach and Orlando
Check the number of people using Brightline per day between Orlando and S FL and you'll see that Brightline numbers blow airline passenger numbers out of the water.. They can add extra stops and still offer express trains that don't stop at every station. It should also be mentioned that a stop only adds 5 minutes to the total journey time, we know this because not every Brightline train stops at Boca Raton.
Air Travel is a bust----TSA, Boeing defects=RR, city to city, no fear, reasonable fare. Full Stop....to airtravel.
Indeed. Air travel should be reserved for extremely long distances. All these
Pie, In, the, Sky. As mentioned by yourself. Its all about financial strategy and much about being viable, which it is not. But hey a lot of dept based capital will be mined by this gold digging operation.
How does Europe handle multitude of private railroads? They seem to be multiplying. It's not just the British Rail, SNCF, DB, etc.
British Rail is in the UK, not Europe, and SNCF and DB are state-owned, not private.
@@TheRailwayDronethere are however a number of open access train operating companies, see my other comment.
It's because the infrastructure is owned by the government and they lease track access to private companies. That's the opposite in the USA, where the vast majority of track is privately owned by freight companies that lease to Amtrak for passenger service. Even Brightline leases most of the track they use from freight railroad companies.
@@uncipaws7643 I see what you mean.
That's what I meant - not just the national ones....@@TheRailwayDrone
Not very optimistic ! ! !
Perhaps not. But perhaps if we all think of projects like these from every angle, we can find new ways to make projects like these be successful and get even more of them built! :-)
Real estate is not going to be the means for Brightline's future success. It will succeed only if it can generate enough revenue to cover operating and maintenance costs and then amortize its investment in infrastructure and equipment, after paying off the bonds that have partially financed the project. Henry Flagler did NOT use real estate to make the Florida East Coast Railway a success. He used the FEC Railway to develop the East Coast of Florida, especially the Miami area, and to facilitate tourism when passenger trains were the only viable means of intercity travel. There is no evidence Fortress Investment Group has any plans to use Brightline for large scale real estate development. Moreover, they DON'T NEED BRIGHTLINE TO DO THAT. Any real estate project they undertake will have to succeed on its own merit because there is no real symbiotic relationship between intercity rail and real estate. Urban eail transit is an entirely different matter. It can both stimulate and facilitate densification in large cities, resulting in large scale real estate developments. The assertion that Brightline needs real estate to be financially viable is rooted in a liberal bias against private sector infrastructure projects and a preference for government ownership and operation. Amtrak is the latter and is anything but a success.
These passenger rail activists ignore the fact that these trains are a nineteenth century technology. We are in the 21st century now. We have cars, highways, airplanes and buses that are cheaper and more efficient than passenger trains. Even famous trains like the Japanese Shinkansen lost so much money after it was established that the system was privatized in order to cut, but not eliminate, its massive losses.
Get to the point. No history lesson needed.
The history kindof WAS the point of this video. haha Thank you for watching. :)
So Brightline is a money loser. That is the point! BTW... Commercial re-estate is dead.
I moved out of shithole Stuart just so I don't have to listen to non stop horns blaring all day and evening long. I could see inside the trains passing by at night and they were almost empty.
I laugh at the ole "I looked into the train and gave an accurate count of passengers" line. Have a seat...
Why would i want to support a channel that bashes our rail s
That's interesting that you think this video is bashing rail. I think it's quite the opposite... showing how being resourceful and thinking outside the box will get MORE rail projects built. Please elaborate if you don't mind. I would love to hear more of your thoughts. And thank you for watching!
Please hire a professional voiceover person.
I am a professional voice over artist for my day job…
@@RailWeekly good for you...the Mincy g@ y lisping. I come from a family of professional announcers.
@leandromondelez1205 Thank you for the kind words :)
Real estate isn't its only means. Also lets see how revenue is when it reaches Tampa and the they make a station in Cocoa to serve the Space Coast.
Real estate isn't its only means. Also lets see how revenue is when it reaches Tampa and the they make a station in Cocoa to serve the Space Coast.
Real estate isn't its only means. Also lets see how revenue is when it reaches Tampa and the they make a station in Cocoa to serve the Space Coast.
Real estate isn't its only means. Also lets see how revenue is when it reaches Tampa and the they make a station in Cocoa to serve the Space Coast.
Real estate isn't its only means. Also lets see how revenue is when it reaches Tampa and the they make a station in Cocoa to serve the Space Coast.
Real estate isn't its only means. Also lets see how revenue is when it reaches Tampa and the they make a station in Cocoa to serve the Space Coast.
Real estate isn't its only means. Also lets see how revenue is when it reaches Tampa and the they make a station in Cocoa to serve the Space Coast.
Yes! The Tampa stop will prove very interesting. I also wonder how that will affect Amtrak's ridership in Tampa.
Real estate isn't its only means. Also lets see how revenue is when it reaches Tampa and the they make a station in Cocoa to serve the Space Coast.