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Low-Fare, Curbside Bus Operators Picking Up Amtrak Market Share

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August 01, 2011

Curbside bus operations such as Megabus are cutting into Amtrak's business more than Greyhound's, according to a new study.

Megabus and BoltBus both attract mostly young riders drawn to convenience and onboard wi-fi, the report says.

Megabus, which is significantly expanding its Hartford service this month, is eating into Amtrak's Northeast Corridor business, but isn't pulling in any significant share of the railroad's lucrative Acela ridership, according to researchers at DePaul University.

"In the East, curbside bus service is taking a particularly large number of travelers from passenger trains. More than a third of those surveyed report that they would have ridden trains had curbside buses not been available," says a study co-authored by Professor Joe Schwieterman, director of DePaul's Chaddick Institute for Metropolitan Development.

BoltBus and Megabus have emerged over the past five years as major players in intercity transit along the East Coast and in the Midwest, and now serve 60 cities in 17 states.

They borrow heavily from the low-cost, low-fare model of Fung Wah and similar Chinatown bus lines, picking up and discharging passengers at downtown sidewalks instead of enclosed, full-service bus depots. With no waiting rooms or ticket counters, their cost of business is lower.

Unlike the Chinatown lines, though, BoltBus and Megabus guarantee riders seats on specific trips — so a ticket for a 7 a.m. Manhattan-to-Boston departure ensures a seat on that bus. During peak travel periods, the Chinatown discount lines sell more tickets than their buses can accommodate, and customers either scramble ahead of each other to board or else wait for a later trip.


Schwieterman's research team surveyed hundreds of Megabus and BoltBus riders in the Midwest and along the East Coast, and has concluded that more than 20 percent wouldn't have traveled if the curbside carriers weren't operating. In the East, nearly half of curbside bus riders say they would have flown, driven or taken a traditional bus, and 34 percent said they would have ridden Amtrak.

"The curbside sector is growing at a fast enough rate that it is likely appreciably slowing the rate of growth on Amtrak's Northeast Corridor services and affecting the competitive balance," Schwieterman said.

Almost half of the customers of curbside lines are aged 18 to 25, and they say that low fares and onboard wi-fi are the two biggest reasons for choosing the bus, researchers said. The absence of enclosed bus stations doesn't appear to be a deterrent; many younger riders think of depots as dirty and dangerous, and prefer getting on and off the bus from city sidewalks.


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