Posts Tagged ‘Amtrak fare rules’

Amtrak to Change Fare Rules March 1

February 24, 2020

Amtrak plans to make some of its most popular discounted tickets non-changeable and non-refundable on March 1.

The changes to the terms of the “saver” tickets mirror the rules applied to discounted airline fares.

Amtrak also plans to tighten the rules on standard fare tickets at the same time.

Currently, passengers buying “saver” tickets have some flexibility to change their travel plans and to get a refund if they cancel their trip.

Amtrak Executive Vice President Roger Harris, who is the carrier’s chief marketing and revenue officer, said tightening the rules for discounted tickets is a trade-off that will allow the railroad to make “the very lowest fares even lower.”

But no longer will passengers be able to get refunds for discounted tickets. “In other words, once you buy it, you use it or you lose it,” Harris said.

The changes in the fare rules had been expected after Business Insider last December published a leaked internal Amtrak memo describing plans for fare restrictions.

This isn’t the first time that Amtrak has cracked down on refunds and cancellations.

The carrier two years began imposing a 25 percent cancellation penalty.

Ticket change penalties are standard in the airline industry and in 2018 the airlines raked in $2.7 billion in reservation-change and cancellation.

Amtrak expected to gain $10 million dollars a year from the rule changes.

The new fare rules that become effective next month will affect “saver” and “value” tickets by establishing a 24-hour window for passengers to change their travel plans once ticketed.

After 24 hours, the ticket will become nonrefundable, and no changes or upgrades will be allowed.

Currently rules allow discounted tickets to be changed at any time before departure subject to a 25 percent cancellation fee.

Standard and value fares will come with a 25 percent penalty for cancellations or a 15 percent penalty for changes made within two weeks of departure, unless the passenger is changing or upgrading the reservation on the same train or day as the original reservation.

Standard fares currently are fully refundable if canceled eight days or more before departure. If canceled less than eight days before departure, the 25 percent cancellation fee applies.

Flexible, business and Acela First-Class Premium tickets are still refundable up to the moment of departures and changes can be made at any time.

Amtrak said that in the wake of its fare rule changes it will promote even more discounted fares for travel aboard its Acela and long-distance trains.

One area in which Amtrak continues to distinguish itself from the airlines is with add-on fees.

The carrier said it has no plans to charge passenger fees for baggage.

But Harris said that doesn’t mean it will never impose such fees.

“Frankly, we should review it,” he said. “But I don’t think we’re going to be like an airline that suddenly says give me $30 for your bag. I don’t think that’s the value proposition that we offer.”

Amtrak allows passengers two personal items and two carry-ons, plus two checked bags free.

Leaked Memo Suggests Amtrak May Impose Restrictions in Effort to Boost Fare Revenue on Cheapest Tickets

December 14, 2019

A news report on Friday cited a leaked Amtrak internal memorandum that listed changes the passenger carrier is considering making in early 2020 to boost revenue.

These include making its lowest fares nonrefundable and nonchangeable. Other fares would be subject to a 25 percent cancellation fee and a 15 percent change fee within 14 days of travel.

The changes are similar to those that have been standard in the airline industry for several years.

A report by Business Insider, a website specializing in American business and financial news, said Amtrak is taking another page out of the airline revenue playbook by seeking to increase ancillary revenue and create more fare segmentation.

Airlines earn ancillary revenue by charging fees for such things as seat assignments and checked baggage.

The Business Insider report framed the proposed changes as part of an ongoing drive by Amtrak to turn a profit for the first time in its 48 year history.

The changes could come as soon as January although no change fees for tickets are currently shown in Amtrak’s published fare guide.

The memorandum proposed making Amtrak’s saver fares nonrefundable and nonchangeable 24 hours after purchase.

Under Amtrak’s current policies, saver fares are fully refundable up to eight days before departure. Holders of the fare can cancel their trips and receive a voucher worth 75 percent of the fare paid.

“Value” fares would be subject to a 25 percent cancellation fee and 15 percent change fee within 14 days of departure.

Amtrak does not currently impose change fees for value fares.

The Business Insider account noted that Amtrak President Richard Anderson is a former airline CEO and that several of the rail passenger carrier’s top executives also worked in the airline industry.

The report said Anderson earlier this year has said that small changes in fare structures have already helped Amtrak increase revenue.

“Pricing and revenue management was thought of like some department over in another building and we didn’t pay much attention to it,” Anderson said in September. “We’ve been able to bring some commercial instincts in and make some basic investments in revenue management technology. Nothing fancy, just basic, good, RM [revenue management] practices.”