The Florida Fun Train was meant to be a lot of different things for a lot of different
people.
To the employees of First American Railways, it was going to be the start of a new trend
in vacationing.
A trend they would lead.
To the residents and businesses of Broward and Osceola County, it was going to be a boon
to tourism.
And to those in transportation, it was going to be yet another stepping stone along the
path to expanding railroads in the state of Florida.
However, after less than a year of operation, some conveniently timed missing financial
paperwork, and a fatality, the Florida Fun Train was just one thing: a failure.
The premise was simple.
Plenty of tourists, especially international ones, were taking longer vacations in Florida.
On those vacations, they were doing everything from cruising around the keys and visiting
the beaches of Miami, to enjoying the theme parks of Orlando.
The perceived problem was that in between the beaches of Miami and the theme parks of
Orlando was a whole lot of nothing.
Tourists would either have to rent a car and take a 3.5 to 4-hour drive, or take a train,
or even book a short flight.
It was boring travel breaking up a fun vacation.
But what if the travel itself could be as fun as the vacation?
The Florida Fun Train was first announced in early 1994.
It was going to be a direct train service that connected Fort Lauderdale with Orlando
and the train itself was going to be packed with entertainment.
The various cars of the train would offer everything from restaurants and dance clubs
to video game arcades and even a theater.
The President of First American Railways, Gene Garfield, described the company’s project
as a theme park on rails.
They also wanted it to be affordable, suggesting an intended one-way price of $50 per person.
At the time that was slightly higher than your average Amtrak ticket, but the idea was
you were getting additional value out of it.
In order to create the Florida Fun Train, First American Railways sold publicly offered
securities to foreign investors.
It was considered a risky investment by the SEC, but it was a fascinating enough concept
to win over support.
While the funding for the Fun Train came in, it did so slowly.
As a result, their initial planned launch of 1995 turned into 1996 and then 1997.
At an estimated cost of $900,000 each, First American Railways planned to start with six
cars.
Of the three entertainment cars, one would feature a tropical bar and grill, as well
as live music for adults.
The second would include a 1950s style diner, a wine bar, and a gift shop.
And the last car would offer play areas for kids, along with an arcade that featured VR
attractions.
Because if there’s one place you want to experience 90s quality virtual reality, it’s
definitely on a moving train.
There would also be three passenger cars that were designed to have large glass dome tops
so that riders could take in the sights as they made their way through Florida.
Throughout those cars, guests would be greeted by roaming magicians and two clowns by the
name of Choo-Choo and Bubbles.
Before the service even launched, First American Railways began to plan ahead for possible
success.
They teased the idea of a potential second line, called the Space Coast Fun-Train, that
would run to Kennedy Space Center.
Now I need to stress that this was an unusual move.
While the company did secure the funding they needed to get the Fun Train off the ground,
they only barely did.
The project itself needed to be altered as a result.
For instance, the original plan of connecting Fort Lauderdale to Orlando International Airport
was changed.
Instead, the Fun Train would stop in Kissimmee, creating a shorter and cheaper trip.
The price of the journey itself was also raised before it premiered, from $50 one-way to $70.
Lastly, the train itself was a compromise, with it originally being planned to have 13 cars.
So while it’s not unusual for a company to plan internally for success, the fact that
they went to the media to tease a second line already was… kind of ambitious.
The Florida Fun Train departed on its inaugural trip on October 15th, 1997, and the early
reviews were mixed.
While many found the experience unique and thought it was a cool idea, others were claiming
that the train just wasn’t offering enough entertainment to fill the four-hour ride.
Offerings like the traveling magician and clowns quickly got repetitive, and the fact
that the video game arcade cost money like any other arcade made it feel like a hidden expense.
Still, it felt like a concept that just needed refining.
They were problems that could be easily fixed.
However, the more important problem that wasn’t so easy to fix was the general lack of interest
from tourists.
On a train designed to fit up to 400 passengers, the first Fun Train had a total of 120 sold tickets.
Analysts hired by First American Railways predicted that the company would need to sell
a quarter of a million tickets a year to break even.
First American claimed that they had 360,000 inquiries for tickets, but they wouldn’t
disclose how many they actually sold which was corporate-speak for “probably less than
a quarter of a million.”
It would only take a few weeks after that first trip before the problems would begin
to pile up.
That November, First American Railways president, Raymond Monteleone, resigned.
At the same time, an SEC filing from the company revealed that ridership was lower than expected
and that “only minimal revenue had been generated.”
The filing stated that if ridership didn’t increase and they couldn’t secure more capital,
they would be forced to stop operating the train by the end of the year.
That news, in turn, caused the company’s stock to drop.
Between the summer before the launch and that December, the stock had lost 74% of its value.
After securing additional funding, mainly from previous investors, they pushed ahead
into 1998 with a new focus: locals.
They expanded and began offering a Tampa to Orlando route with a stop in the middle at Lakeland.
The hope was that the shorter trip and a new reduced rate for Floridians would open them
up to the local market.
Instead of being a means of travel for tourists going from attraction A to attraction B, the
Florida Fun Train would be the attraction itself.
Unfortunately, this new approach to the business was kicked off with tragedy.
One hour into its very first trip between Tampa and Orlando, the Fun Train stuck a tow
truck that was sitting on the tracks in Polk County, killing the driver.
It was reported that the train dragged the wreckage for nearly half a mile before coming
to a complete stop, and since those three passenger cars were designed with glass domes
for scenic views, many on board were able to witness the accident.
Tragic accident aside, the inaugural trip wasn’t too promising.
The initial journey only had a reported 50 passengers, and the accident resulted in First
American Railways having to send the train to their Fort Lauderdale maintenance team
to check it over.
It would otherwise be a routine part of recovering from an accident, but for a company with just
one train that was hemorrhaging money, it was a crucial lost week.
As the summer of 1998 came to a close, First American Railways was plagued with problems.
For one, Carnival Corp sued them for trademark infringement, claiming that the railroad company’s
use of “Fun Train” was too similar to their use of the term “Fun Ships”.
Perhaps First American could have fought back, but again, in their financial state, a lengthy
corporate lawsuit was not going to do them any good.
So they settled out of court for an undisclosed sum along with the promise to tie the “Fun
Train” brand closer to their company name.
That same week, the company was delisted from the NASDAQ for consistently trading for under
$1, which usually isn’t taken as a good sign by investors.
Finally, at the end of August, their latest SEC filing revealed that they had lost nearly
$10 million that year against just $500,000 of revenue.
See, that filing right there told the true story of the Florida Fun Train.
Even if one was to assume it was entirely made up of the lowest-priced offering of $55
for locals, that would still only average out to between 250 to 300 passengers a week.
Regardless of their financial woes, or the lawsuit, or the accident, or the stock issue,
the truth was that not nearly enough people were choosing to ride the train.
On Thursday, September 17th, after failing to obtain the $1 million a month needed to
run the service, First American Railways indefinitely ceased operation of the Florida Fun Train.
Seventy of the company’s seventy-five employees were laid off.
The following month they filed for Chapter 7 bankruptcy.
They also, conveniently, claimed that in the couple-of-week window between filing for bankruptcy
and having to submit their schedules of assets and liabilities, that their “computers crashed”
resulting in incomplete financial information.
Information including things like how much the company was paying their officers and directors.
Yeah.
OK.
And that was that.
The following March the company put their Fun Train up for sale, and that July it was
purchased by the Alaska Railroad Corporation for $3.6 million, which went towards paying
off debts.
The Florida Fun Train was interesting because, on the surface, its failure could be tied
to a swath of problems, from its initial underfunding to the accident to lawsuits at the worst time possible.
But underneath those problems, it was still a concept that seemed fundamentally undesired.
Sure, that four-hour drive from Miami to Orlando can be boring, but when it’s just four hours
out of a one or two-week-long trip, it’s not that big of a deal.
And that’s how it turns out sometimes.
The problem they were trying to solve wasn’t much of a problem at all.
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