Florida High Speed Rail
Projection Up 30 Percent
Despite
Air Fare Drop of 60 Percent:
Minimum Cost to Floridians: $8 Billion
Chart | Table | Analysis |
The Public Purpose
|
Comparison of Projected
High Speed Rail (HSR) Fare Yield to
Airline Fare Yields: Florida
|
| Date & Source |
High Speed Rail
(HSR) |
Airline |
Air Compared to Rail |
Air Compared to Projection |
| FDOT/FOX Projection: (1995) |
$0.425 |
$0.709 |
+66.8% |
--- |
| JMI Report Projection: (1996) |
$0.425 |
$0.367 |
+13.6% |
-48.2% |
| USDOT Actual: 1996: 3rd Quarter |
$0.425 |
$0.259 |
-39.1% |
-63.5% |
| USDOT Actual: 1996: 4th Quarter |
$0.425 |
$0.234 |
-44.9% |
-67.0% |
| USDOT Actual: 1997: 1st Quarter |
$0.425 |
$0.285 |
-32.9% |
-59.8% |
| USDOT Actual: 1997: 2nd Quarter |
$0.425 |
$0.309 |
-27.3% |
-56.4% |
All amounts in 1995$
Yield is fare per air passenger mile. |
|
|
Florida Air Fares: 2nd Quarter 1997 and
Proposed High
Speed Rail Fares |
| Market |
High Speed
Rail |
Airline Fares |
Air
Compared to
Rail |
| Orlando-Miami |
$77 |
$104 |
35.1% |
| Tampa-Miami |
$97 |
$75 |
-22.7% |
| Orlando-Fort Lauderdale |
$74 |
$51 |
-31.1% |
| Tampa-Fort Lauderdale |
$88 |
$51 |
-42.0% |
|
ANALYSIS
St. Louis (4 February 1998): A report to be released tomorrow
indicates that the Florida High Speed Rail passenger projection has increased approximately 30
percent. The new annual ridership projection is 8.256 million, up from the previous 6.2 million. The new
projection is also 30 percent more than the annual ridership on the high speed Eurostar
, which operates
between London and Paris --- a market three times as large as the Florida market.
- This higher projection is in the face of average airfares in Florida that have declined more than 55
percent from the assumptions used in preparing the lower (6.2 million) projection.
- The new projections assume that 2.7 million annual riders will be attracted from airlines --- up from 1.9 million
in the previous projection.
- If fares on the high speed rail line were lowered to match air fares --- a practical necessity --- the state of
Florida's subsidy would increase from $3 billion to $8 billlion, assuming that all other Florida DOT projections
are met (which is highly unlikely).
Wendell Cox, principal of Wendell Cox Consultancy and author of the
James Madison Institute policy report on the Florida High Speed Rail
project called the new projections:
Simply unbelievable and insignificant. People are not going to pay fares that are 35 percent higher than air
fares. Moreover, for the high speed rail line to have a perceivable impact on traffic congestion would have
required a 300 percent projection increase, not an insignificant 30 percent increase.
He added that high speed rails diminished competitiveness in the Florida market could lead to an
early bond default: Our report originally estimated that the Florida taxpayer subsidy would be, at best,
$13.8 billion --- to meet the new airfares, the subsidy would rise to nearly $17 billion.
In April 1997 the James Madison Institute published the
Wendell Cox Consultancy report
on the proposed Florida high speed rail project (Miami-Orlando-Tampa), which concluded that
the project would provide only negligible benefits, but its cost to Florida would be enormous.
WENDELL COX CONSULTANCY & THE PUBLIC PURPOSE
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