It is an article of faith among urban & transportation planners that auto travel is very expensive and heavily subsidized to boot. They use this claim over and over to justify increased subsidies to transit.
Fortunately, we have very good information on the actual cost of driving, the actual costs of transit, and the actual subsidies to both. We also have reasonable information about the social costs of driving and can speculate a bit about the social costs of transit.
What does it cost to drive per passenger mile?
- According to the Bureau of Economic Analysis, Americans spent $988.2 billion on driving in 2005 (see line 69). This includes capital costs, operating expenses, and taxes, but not any highway subsidies.
- According to the Federal Highway Administration, Americans drove 2.99 trillion vehicle miles in 2005. Counting only passenger vehicles, and not heavy trucks, and it was 2.75 trillion vehicle miles.
- According to the US DOT, the average auto carries 1.63 people, so 2.75 trillion vehicle miles equal 4.48 trillion passenger miles.
Divide 4.48 trillion into 988.2 billion and the cost of driving averages 22.0 cents per passenger mile.
The National Transit Database provides costs and passenger miles for transit. As I explained in a previous post, the data are not terribly easy to read, as operating costs, capital costs, fare, and passenger miles are all in separate files. So I’ve gathered them all into one spreadsheet for you.
According to cells Q1371 through S1378 of this spreadsheet, average capital and operating costs per passenger mile are:
It is appropriate to point out that the capital costs in any given year are not attributable to the passenger miles carried in that year but should be spread out over roughly 30 years worth of passenger miles. On the other hand, in the long run agencies will need to sustain a continuous investment in capital costs, so the costs for some modes such as buses are probably pretty close to the long-run costs per passenger mile.
In the above table, the costs for trolley buses and light rail are a little high, reflecting heavy investments currently being made in those two modes, but the rest are probably about right. Since light rail and trolley buses are a relatively small portion of total transit travel, the overall average of 25 cents a passenger mile is also roughly correct.
So transit costs 84 cents per passenger mile, nearly four times the cost of driving. Transit fares average 20.4 cents per passenger mile (interesting how the transit industry keeps fares close to the actual cost of driving), so the subsidies are nearly 64 cents per mile.
How much are the subsidies to driving? That answer is also available from the Federal Highway Administration. In 2005, federal, state, and (mostly) local governments spent $39.2 billion in non-highway user fees on roads. Offsetting this, federal, local, and (mostly) state governments diverted $21.3 billion from highway user fees into non-highway programs. So the net subsidy was $17.9 billion. (By comparison, transit received $30 billion in subsidies in 2005.)
The highway subsidy works out to a subsidy of 0.38 cents per passenger mile. Added to the consumer cost and the total cost of driving is 22.4 cents per passenger mile — still a lot less than transit costs.
What about the social costs of driving? Back in the 1990s, UC economist Mark Delucchi did a massive series of studies of these social costs, which you can download from the University of California Transportation Center. He summarized his work in an article in Access magazine, which is also published by the University of California Transportation Center.
Many auto opponents have attributed extremely high social costs to autos and roads. After reviewing the literature, Delucchi concluded that most of these claims “rely on outdated, superficial, nongeneralizable, or otherwise inappropriate studies.”
Delucchi himself estimated (in the Access article) that social costs averaged about 6.9 cents per passenger mile. Two cents of this was health problems due to air pollution, and he based his air pollution calculations on Los Angeles in 1990. Cars are cleaner today and just about everywhere is cleaner than Los Angeles, so the cost of air pollution should be quite a bit lower. He also attributed a significant chunk of costs to congestion and accidents, but some would say that those costs are paid mainly by the users, not society in general.
Transit also has social costs. Buses produce far more ozone-producing air pollution per passenger mile than cars. The coal-fired power plants needed to supply electric rail transit with energy also pollute. Total social costs might be less than for cars, but they are still more than zero.
Using Delucchi’s 6.9 cents, the total cost of driving is 29.3 cents and the subsidies are 7.3 cents per passenger mile. If the social costs of transit are 2 cents per passenger mile, the total costs of transit are 86 cents and the subsidies are 66 cents per passenger mile. So transit costs are nearly three time auto costs, while transit subsidies are more than eight times auto costs.
This doesn’t mean transit is evil. What this should suggest instead is that the transit industry needs to make itself more efficient. This could be done by introducing competition into the industry or, at the least, contracting out transit to private operators who spend about 60 percent as much, per passenger mile, as public agencies. It goes without saying that an efficient transit industry would not sink billions into rail capital improvements when buses can do everything rail can do at a far lower cost.
Unfortunately, rather than consider these options, many planning advocates just call anyone who proposes them “anti–transit.” That’s like calling anyone who proposes to improve our health care system “anti-medicine.”