The CalTrain commuter train system in the SF Bay Area doesn't seem to understand how to do things. They raise fares, reduce the number of trains, close stations... and then complain that they lose riders. They can't seem to figure out how to be on time and then complain that they lose riders. They frequently stall. Accidents are so common as to be ludicrous. They set higher prices for the train parking areas in lots shared with other systems, then (when people park on the cheaper side) raise parking fees, and yet insist that they need to raise fares because they've lost riders.
Meanwhile, the BART parking lots are full at 10am. BART trains run on time, every 20 minutes. Parking is convenient. Parking fees are paid at the same POS as the travel fare. Fare cards don't expire. BART vs CalTrain is an interesting exercise in Compare and Contrast.
If we go into SF, we're happy to ride BART. It's simpler and often cheaper than driving. But if I have a job that means the best transportation option is CalTrain, I have to think long and hard about that. A 40-minute trip on BART takes 40 min. A 40-min trip on CalTrain could take up to 2 hours.
“Four dollars a ride? That’s heinous!”
The truth is that you’re probably going to pay it anyway. So whether you’re a New Yorker or Washingtonian or Angeleno or Atlantan, if your local public transportation authority hikes the fares, you’re going to complain loudly — and then pay up.
A new article in Capital New York spells it out, explaining how there’s precious little market pressure preventing the city’s Metropolitan Transit Authority from raising prices to ride. According to data from the report “Transit Cooperative Research Program 95,” rider response to fare changes is generally inelastic. (If you’re unfamiliar with that economic term, it means that straphangers don’t put their money where their mouth is when complaining about price hikes.)
Dana Rubinstein reports:
By some standards, particularly compared to the customer costs of other major systems around the world, the fares in New York are quite cheap. In January, for example, London’s transit authority raised the average Underground fare to £2.70, which converts to $4.33. In the United States, the picture is somewhat more complicated. New York’s subway fares are slightly lower than in Washington, D.C., where the cost varies by distance and time. There, the average subway fare for this fiscal year is projected to be $2.87. The D.C. bus fare, however, is substantially lower, projected to an average of $1.07. Taking one ride on the Chicago “El” costs $2.25, a quarter less than our single-ride fare but the same as the base fare used to calculate larger MetroCard purchases. In Los Angeles, straphangers pay $1.50 per ride.
New York City is considering raising prices from $2.25 to $2.50 for a single ride and from $104 to $125 for a 30-day unlimited pass — a lot of money but quite a deal, considering how much New Yorkers use their public transit system.
So why don’t more cities around the world raise prices? Because they’ll lose ridership. “If a transit system wants to increase total fare revenues, it should increase fare levels, but expect some ridership loss,” according to the authors of the report cited above. “Likewise, reducing fare levels will almost always increase ridership, but at a cost of revenue loss.”
Thus the quirk of public transit economics: a system can preserve profitability even while serving a minority of citizens. And what’s the point of that?
Photo: Vincent Desjardins/Flickr