Billionaire tech mogul and presidential advisor Elon Musk has suggested privatizing Amtrak passenger train services, among other federally funded services, as part of the DOGE drive for efficiency.
During a virtual appearance at a Morgan Stanley tech conference on March 5, Musk described Amtrak as a “sad situation” compared to high-speed rail in Europe and Asia, saying, “If you’re coming from another country, please don’t use our national rail. It’s going to leave you with a very bad impression of America.”
He further argued that privatization would create “a feedback loop for improvement,” suggesting inefficiency and waste in its current government-run form justify the shift. The push comes as Amtrak reported investing $4.5 billion in 2024 to upgrade infrastructure and its aging fleet, aiming for its first ever profit under the second administration of President Donald Trump. Yet Musk called it “embarrassing” and insisted privatization is the fix.
The White House hasn’t commented directly, though Trump has historically been open to privatizing government services. Amtrak is taxpayer-funded, receiving billions in subsidies to keep it operating. While privatization has been proposed in the past, such efforts have historically been derailed in favor of more taxpayer funded access to passenger rail services.
NC routes
Amtrak provides a mix of state-supported and long-distance passenger rail services in North Carolina, making it a significant hub for rail travel in the Southeast. The state’s services are a blend of regional routes supported by the North Carolina Department of Transportation (NCDOT) and national routes connecting to major cities across the country.
In total, North Carolina has 16 Amtrak stations: Charlotte, Raleigh Union Station, Cary, Durham, Burlington, Greensboro, High Point, Salisbury, Kannapolis, Rocky Mount, Wilson, Selma, Fayetteville, Southern Pines, Hamlet, and Gastonia. There are additional seasonal stops added, such as in Lexington during the BBQ festival, or the Raleigh State Fairgrounds during the fair in October.
The Piedmont route links nine of those cities across the 172-mile Piedmont corridor. Charlotte, the third busiest station in the Southeast, and Raleigh Union Station anchor the Tar Heel network, with over 281,000 and 246,000 passengers respectively in FY 2023. The Greensboro station rounds out the top three busiest nodes on the network. Everyone of those passengers costs taxpayers money, however; hence the target placed on Amtrak as the Trump administration focuses on saving taxpayers money.
As a growing state, some of the planned Amtrak expansions are focused here as well. A “Charlotte Gateway Station” is currently under construction to move Charlotte’s station Uptown, set for service later this decade; a Raleigh to Richmond route is also in development, with service expected in the 2030s; and, a proposed Salisbury-to-Asheville route, with an estimated cost of $665 million.
As of now, Musk’s proposal is just that—a recommendation. Trump recently reiterated that point of Musk and DOGE, reminding the media that cabinet heads and congress are ultimately in charge of making cuts based off these recommendations. Congressional approval would be needed to privatize Amtrak, which has been a government-owned corporation since 1971.
NC Railroad company
While DOGE drives efficiency efforts at the federal level, select North Carolina lawmakers have also been tapped to examine ways to realize cost-savings and streamline state government. The NC Railroad Company (NCRR) has been identified in the past as a valuable state asset that could draw a significant price tag to bolster other, core functions of government.
It doesn’t need privatizing, however; the 317-mile rail corridor from Charlotte to Morehead City is already private.
NCRR is organized as a private real estate investment trust in which all the stock is owned by the state. The company opted for REIT status for tax purposes in 1995, and the state acquired the remaining private shares in 1998. Also unlike Amtrak, NCRR actually makes money (maybe because it’s privately run), and is able to reinvest millions each year in its tracks and related economic development projects.
As the state looks to fill big needs related to disaster relief, the potential sale of NCRR ownership might catch the eye of the government efficiency committee. When the state became the sole shareholder nearly 30 years ago, it bought out the remaining 25% of private shares for $62 million, implying a total valuation of $282 million at that time. Adjusting for inflation, that would be closer to a $500 million price tag in 2025.
Norfolk Southern operates freight on the line under a trackage rights agreement, while the aforementioned Amtrak uses the track for passenger services like the Piedmont and Carolinian routes.
Given its role in North Carolina’s economy and connectivity to Norfolk Southern’s network, a buyer might pay an estimated $750 million to $2 billion to secure a monopoly on such a valuable corridor in a growing state. That would also mean forfeiting millions the state receives as shareholder dividends, and political resistance or buyer interest could skew the price.
As Musk and DOGE move forward with savings suggestions like privatizing Amtrak, those government efficiency efforts will likely continue to be mimicked at the state level.
Follow Carolina Journal for continued coverage of politics and policy affecting the great state of North Carolina.