I have to wonder how all the tourist railroads are making out...especially Strasburg, East Broad Top, Mount Rainier Scenic, Heber Valley, Wilmington & Western, etc...

If any of them were to ever close up, I think I'd be distraught. Anyone know how well these roads are weathering the rough economy right now?

The old joke is that when someone else up the street is laid off, it's a recession. When you're laid off, it's a depression. Seriously, unemployment nationwide is at 6.8% last I saw, just up from what economists consider "full employment" of ca. 5%. Go look up the numbers for inflation, unemployment, etc. in the late 1970s, the 1930s, etc. and get back to me.

The "horrible economy" truly depends on who you're talking to. My client is going gangbusters right now, slowed down only by the upcoming holiday and winter weather slowing down some of their clients. There are other businesses out there saying "what recession?"--booze sellers, bars, and even professional entertainers (if they hustle right). And the vicious backlash against nonunion workers and "average Joes" being asked to effectively bail out the ludicrously-rich benefits of UAW workers is starting to have an effect.

The excursion rail industry has a great opportunity to market themselves as an "affordable" outing for the family. Remember that gasoline is WAY down, making travel to an out-of-the-way place affordable once again. It certainly helps to prepare for some lean times ahead, but everybody preparing for the absolute worst in economic terms can often be a surefire way to make it happen, and the hype of the national media isn't helping at the moment.

If you work for the railroad, then yes, the economy is horrible. Railcars are being stored left and right and there's tons of guys being furloughed. Trains are being combined or cut off. It's getting ugly out there, and it's going to get a lot worse. Locals that used to go out with 20-30 cars are leaving the yards with 3-6. Of course booze stores and bars are doing great - when people are out of work, what else is there to do besides drink?

Even though gas prices are down, there's plenty of articles saying people still aren't taking trips or spending money. Only thing saving some railroads is the fact that scrap prices bottomed out.

Now if you'll excuse me, I have to go to work (the first call in FOUR days). But yeah, I guess it's all media hype. Give me a break.

I believe that those operations fortunate enough to be located within a major well-to-do SMSA and able to offer a good half-day's family entertainment at a good, competitive price, can find prosperity in even this economy. Rust Belt and Outback of Burke guys, I don't know - same for those who can't produce a good entertaining program at a good price.

Just a couple weeks ago, I helped a small operation in a great location do Santa trains with no diversions for passengers waiting out in the semicold with minimal visitor facilities apart from a couple outhouses - and they did well. Visitor time was probably about 1.5 hours, half of which was not on board, so parking, waiting and so on was a major part of the time commitment. I can't help but imagine what they could have done with better facilities, more frequent turnover and a more comfortable and entertaining waiting experience, providing there was also advertising to sell the whole shebang.

I'm thinking that if cards are well played, critical mass to create the necessary improvements might come about with the eventual economic turnover - but in the meanwhile, no problem maintaining their current (and has been for many years) comfortable level of service.

So, you gotta be smart about knowing how to continue to make it at a supportable level, as well as produce good events to ice the cake - and, right now, consumer value must be the basis of whatever you do.

dave

Zugmann's description of rail traffic in his area of PA also describes the situation in eastern North Carolina and South Carolina. Currently we are lucky to handle the number of cars all week we had been handling on Monday's alone. We are not a single industry type of operation so the slow down seems to be spread over a wide range of industries.

Just yesterday I recieved requests for donations from 2 museums to which I belong. One is large the other small but both are hurting for money because visitation is down. The large one is off by 20 percent in spite of nearly sold out Christmas events. Officers of that museum are on this board and if they want can speak further about the numbers.

When driving down roads and city streets the lower vloume of highway traffic is obvious. People are obviously not making as many short trips much less longer ones. There may be some areas where it is mostly media hype but that is not the case here. Why do we consider autoworkers benefits "ludicrously rich" instead of the rest of us being ludicrously poor? There are certainly far to many people who meet this discription and many of them are working in the tourist railroad and rail preservation field.

John Bohon

Once again, it apparently depends where you are. The AAR is reporting that freight traffic on American and Canadian railroads is down an average of around 10% 2nd week December 2008 over last year, depending on whether you're counting carloadings, intermodal/trailers, with the Eastern US and Canadian carloadings taking the biggest hit at 16.9 and 18.1 percent respectively. For 2008 to date, nationwide carloadings are down 5.7% and intermodal UP 2.9%.

The massive lumber yard down the street from my workplace has gone from 12-15 cars a week to 3-5 in the matter of a month or so, so I understand that there are indeed cases where big hits are taking place. And if you're in a region where the proverbial tumbleweeds are blowing down the street, it's impossible to convince someone there that not every Main Street has them tumbling down. And part of that is that the TV news producers find the tumbleweeds photogenic and ratings-feeding, while the places running more normally are "boring" as far as TV news goes.

But get this back on topic: What can YOUR museum or operation do to weather the storm? Unfortunately, one part of the equation would have been to assume that the "good times" wouldn't last and plan accordingly--saving for a rainy day, etc. Well, it's a bit late for that, but if a place can't weather a short-to-medium-term 20% decline in patronage, someone isn't planning right.

Remember, in a down economy money doesn't disappear it contracts. That means fewer people are holding lots of cash. So rail museums must continue to fund raise and do so strategically by targeting desirable donors.

Foundations and corporations will have less grant money available, but don't despair. If you don't ask, you won't get.

By the way, be sure to press state and local tourism agencies to help you promote your museum.

Sloan

I posted something a week ago about the Silverton offering season passes for the first time ever. For the cost of two tickets you can ride as many times as you want. The only people who can make that worthwhile are those who are relatively close. One might deduce that this is because they expect less people coming from afar and they want to keep the trains full.

Many organizations run on a shoestring already. The places running lower cost trips remain a good family day out. The most remote and costly places might be hurting.

I am hoping T.J. will post in here about exact percentages for SRI, but lets just say we had to add 50 seats per train, along with using our lounge car, and adding a couple extra trips due to the extreme demand, and even one trip with three cabeese (at $1000 a piece). SRI has done exceptionally well given the economy, and I am guessing that this year blew the doors off previous years (once again, I hope T.J. will comment.)

Our tickets were $65 for adults, and $35 for children. It will be going up $5 next year to keep up with operating costs.

We sold out even after all the added seats (400 per train) and trips, and still had a 15-page waiting list for tickets (if we were able to add more trains, we could have sold out a couple more just from the waiting list), and have been receiving calls from people wanting tickets right up until this weekend. We also have had a bunch of people interested already in purchasing tickets for next year's NPE, and TrainFest 2009.

SRI is not located in a large city, and rather is in the middle of nowhere pretty much. (35 miles to Flint, 14 to Durand, etc...) and the closest highway access is 14 miles away.

1225 performed well, and ended the season with some 3-4ft snow drifts to bust through.

And I must add that none of this would have been possible without the gracious support of Great Lakes Central RR as always for allowing us to run on their rails, especially on a branch that sees pretty much NO use except us past Oakley, MI. This past summer, SRI volunteers along with the help of GLC replaced 1000-ties to keep the track in acceptable condition for continued use.

The Pacific Southwest Railway Museum in Campo (San Diego County), CA did very well this past year. Our "speciality" trains to the North Pole and Tecate, B.C. Mexico did great. Our regular one hour family train ride with museum admission didn't do as well.

All in all, a very good year for us.

For what it's worth, our regular weekend walk-in business at National Capital Trolley Museum was soft for the last 12-18 months before we suspended operations for the move. But any day that featured an event or special program had at least a 25 percent increase in fares sold over a day with no program.

Wesley

I'll call this "related news", snipped from Trains Newswire at Trains.com:

But yeah, I guess it's all media hype. Give me a break.

Compared to 30 years ago, when there was a "misery index", double digit unemployment, interest rates and inflation, this isn't even close to horrible. Forget any comparisons to great depression or the "panics" of 1907, 1873, etc..

The only commonality is "public servants" making huge power and money grabs, to "stabilize" the "economy" because of the "crisis".

Of course there are people hurting. But its well known some things sell better in bad times. So called "inferior goods", distractions & nostalgia all sell better when things are bad. Adjust your marketing accordingly.

To bring it back to preservation

After some years the SPCRR has completed the political portion of the approval process for our car house... Over the same years we have been raising money for the building...

We are now into the bureaucratic process...

We have raised and saved money for the project for nearly 20 years... Two years ago we had 50% of the money needed... with the economy, we now have 75% of the needed money... A win in a bad economy

I've been watching numbers at my clients very carefully.

The "Polar Express" and derivatives seem to have done very well this year. I have one client that is up 30% and was continuing to add post-Christmas runs until they quit selling, which hasn't happened yet. That market appears to be steady to growing. I don't think I've heard of any marked declines in that at all.

Late summer seems to have taken a hit on a lot with gas prices. Then it eased off, and while a lot of people are scared, not that many are seeing big drops.

There's a 'slide' effect to an extent where everybody takes a drop back to a lower position of spending. I've always opiniated that rail museums and excursions are in the bottom part of that equation with cost vs. quality of experience (a good family event at a good price) so the trick is to target your market and push the 'affordable family fun' angle on less than a tank of gas.

If you're on the top 1/4 of the spear (under luxury experience, where people aren't seemingly hit at all, and above the 50% median), you're at risk. TUT is probably in that sphere; remember Grande Luxe was in the same market. Yeah, it's probably cheaper than an Hawaii two-week vacation, but its still regarded as a luxury. And that market really doesn't have a 'family' component, either.

It's all in the cost vs. quality of experience. People still want something to do with the family, you're in a competitive market with a lot of choices. Train experiences are up there with Mom & apple pie, so think how you can provide that family experience and deliver the value. That's the underlying message I'm seeing in the Polar experiences; that's considered a high-value experience with the family. Other stuff, maybe not so much.

I have one client that just got a very nice equipment donation at the end of the year; scrap prices are way down, 2008 sale comperables are still up, the donor made a 2008 profit that they don't want to pay taxes on with 2009 cash and a charitable contribution on the appraised market value vs. scrap value made for a nice tax deduction. Worked for everybody. Six months ago it would have been cut up, and we're talking some genuinely historic equipment here.