Why Tokyo's Metro Is Profitable and New York City’s Isn’t | WSJ U.S. vs. Japan

(light music) - Japan's train system, ranked by Statista, is the most efficient in the world. However, the United States is far behind. It is tied for 11th. About 15 million people ride the subway each day in Japan's capital, about 11 million more users than the New York subway. We compare Tokyo and New York subways to find out how Japan's rail system got so far ahead of the United States. Take a look at this map of the New York City subway system. Now, let's compare that to the map of Tokyo, a key distinction where public transport connections intersect. In New York, those traveling by public transportation to Manhattan will likely only have these options for disembarking.

The Japan map has more connection points. - What is really distinctive about Tokyo and Japanese cities in general is that they are all interconnected. - Commuter trains connect directly to the

city

's subway tracks, reducing congestion and unnecessary trips. - If you simply travel by train to your final destination, you don't have to be paying attention to your transfer station. You just fall asleep and know when you will wake up near your station. - These easy commutes are key for the 2.4 million people who travel to Tokyo daily from outside the

city

. Additionally, Tokyo Wides only need one of two cards to pay for most public transportation systems, not only in the city, but also in many parts of Japan.

And in New York... You often have to have a different card to access any of the transportation systems. It's not like an integrated payment system or a government system. - So you have to use all these different tickets to travel on public rail systems. In some cases, these separate rail systems are the result of different jurisdictions overseeing transit. The subway, for example, is owned by the city and leased to the Metropolitan Transportation Authority, better known as the MTA, which is in turn controlled by the New York state government. And New Jersey Transit, which connects to New York City, is managed by the New Jersey Department of Transportation.

While New York does not have fully integrated public transportation connections, some aspects are improving. The first thing is payment. - We now have the possibility to pay by credit card when you enter the

metro

, so it is not necessary to have a special

metro

card, which will eventually become obsolete. I think the goal is to eventually have one fare on a rail system, and that will allow you to pay for the whole process. - Then there is profitability. Aside from 2020 and 2021, during the COVID-19 pandemic, Tokyo Metro, the city's largest subway company, has been

profitable

. Compare that to the MTA, which historically operates at a loss.

Its outstanding debt is expected to reach $47 billion in 2026. A key reason for this difference is central government financing. Japan invests a lot in public transportation. The national government owns approximately 53% of the Tokyo Metro and the Tokyo Metropolitan Government owns approximately 47%. - After World War II, there was continued investment in the public transportation system, which is primarily the subway, the JR system, and interconnecting private commuter rail systems. There has never been a let up in continued investment to add lines and make them work better. - The MTA, on the other hand, is not owned by other private companies.

Its funding comes from multiple places, including taxes, city and state governments, and some federal funds. The MTA also makes money by selling bonds. - It is one of the main issuers of municipal bonds in the entire United States. - One of the largest sources of financing for both the New York and Tokyo subways comes directly from users. In Japan's capital, companies have the flexibility to charge more. - Everything is fair by distance, so you get your fair at the end. - So depending on the system you choose, the cost for passengers can range from 170 to 430 yen, which converts to around $1.27 to $3.22.

The main New York subway fares are fixed, although LIRR and Metro North prices vary by area. - Right now, about 40% of the MTA's funding comes from fares, what riders pay to ride. That number has dropped a lot, which is why we are remaking the financing model. - Because many white-collar workers have worked from home since 2020, there have been fewer passengers and therefore less income. This has worsened the MTA's financial situation. To help cover the funding gap and account for inflation, prices will rise slightly from $2.75 to around $2.86 later this year. In Japan, public transportation has a reputation for arriving on time.

In 2017, a commuter train connecting Tokyo to Tsukuba apologized for having a train leaving 20 seconds early, but the Tokyo subway may face some hiccups. Delays in Tokyo Metro publications for the last 35 days. In April of this year, several train lines were about 10 minutes late. In New York City, delays are common. In 2022, New York City passengers waited an average of 64 extra minutes on platforms cumulatively each month, as well as 18 extra minutes on the train. But the MTA says that's an improvement. - We currently have the best performance in terms of punctuality of our metro system in more than 10 years.

It may not be up to Asian standards, but for New York it's really a big step in the right direction. We have an old system, so there are things that go wrong mechanically. It has a huge system of switches and interlocks, which require a lot of maintenance. - Japan's history of investment in public transportation gives Tokyo the advantage for its rail system. - It would take years, if not decades, of very significant investments in the New York subway system for it to reach the levels of efficiency of the Tokyo subway system because they have been working hard on it for the last 60 years. (light music)