Featured | 11 months ago

Cheaper Oil Weakens U.S. Bus Services, Rail

A study by researchers at DePaul University reported that inexpensive gasoline is squeezing U.S. bus companies and the Amtrak passenger rail system that wage more consumers would welcome alternatives to driving for trips shorter than 400 miles.

The study, released Tuesday, discovered nine metropolitan areas in the United States with populations over 700,000 now have no Amtrak passenger rail service or express bus service.

For the last three years, eight of the 50 most traveled routes between cities 120 to 400 miles apart have lost either express coach or Amtrak service, according to the study by the Chaddick Institute for Metropolitan Development at DePaul University in Chicago.

Travelers are choosing planes for trips longer than 400 miles, and cars for trips below 100 miles, though a number of enterprises have looked to profit from offering alternatives to planes and cars for trips that lie between those two distances.

Megabus, operated by Britain’s Stagecoach Group, launched in the United States in 2006. The Greyhound bus line and its BoltBus express coach service is owned by the British company FirstGroup PLC.

Silicon Valley billionaire Elon Musk caused a rise last month when he claimed, without offering details, that he had received verbal approval from the government to build an underground, “hyperloop” transport system that would whip passengers between New York and Washington, D.C. in a vacuum tube. Startup Hyperloop One is developing a vacuum tube transport system.

“The attention being given to the Hyperloop stems from a yearning by travelers for something new and different at a time when improvements to intercity ground travel seem to be stuck in low gear,” stated Joseph Schwieterman, one of the authors of the DePaul study.

For Instance A family of three traveling between Detroit and Cleveland now has a option between driving or paying more than $1,000 for airfare bought two weeks in advance, the study displayed. Express coach bus service would cost roughly $120 to $180, the study reported.

Ridership and revenue on Amtrak and bus services such as Megabus and BoltBus has dropped the last two years, roughly tracking a fall in U.S. gasoline prices, according to data put together by the Chaddick Institute researchers. Intercity bus traffic in the United States declined 8 percent in the first half of 2017, after a 1.3 percent drop for all of 2016, the study’s authors anticipated.

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