Ottawa will spend $4.7 billion on 313 new VIA Rail passenger cars manufactured by Alstom in Thunder Bay and Quebec

Off the rails

The announcement was understandably well received back home. It will support nearly 700 jobs and provide a welcome shot in the arm for a community that could use it. I am glad for the workers and their families.

At some risk of offending my fellow Thunder Bayers, however, the most important question isn’t whether the trains could have been built more cheaply somewhere else, as some have raised. It’s whether Ottawa should be replacing VIA Rail’s trains at all.

Canadians have largely answered no through their own transportation choices. VIA recorded 4.4 million passenger trips in 2025, down roughly 12 percent from its 2019 peak despite significant population growth.

This shouldn’t be a huge surprise. VIA’s on-time performance was just 35 percent, and yet its prices aren’t especially competitive with air or car travel. It’s a self-evidently inferior experience.

The consequence is that the Crown corporation’s financial results are deteriorating. Last year, VIA generated $518.5 million in revenue against $894.2 million in operating expenses. Federal funding totalled $735.5 million, following more than $900 million the previous year.

Every single route fails to break even and requires an operating subsidy. In some cases, like Toronto to Ottawa, the subsidy is about $50 per passenger. In others, like Toronto to Vancouver, it’s almost $1,000 per passenger.

As explained by the government, the new cars being built in Thunder Bay are intended to serve eight long-distance, regional, and remote routes that carried only 216,000 passenger trips last year. Given the operating and capital expenses, it’s not obvious that it wouldn’t be cheaper to purchase the affected travellers their plane tickets or even cars.

Off the rails

Prime Minister Carney came to my hometown of Thunder Bay this week to announce that Ottawa will spend $4.7 billion on 313 new VIA Rail passenger cars manufactured by Alstom in Thunder Bay and Quebec.

The announcement was understandably well received back home. It…

— Sean Speer (@Sean_Speer)September 4, 2026

Budgeting is policy. This week’s announcement therefore amounts to a long-run endorsement of VIA Rail and its current business model. The new fleet will become the justification for continuing the routes, and the continuing routes will become the justification for ongoing operating subsidies and capital funding. At no point is the institution itself required to demonstrate that Canadians actually want what it provides at anything approaching its real cost.

VIA has come to resemble the CBC in this respect. Both institutions command a kind of emotional attachment among politicians, commentators and a segment of the public. They’re treated as expressions of Canadian identity whose continuation is inherently valuable. Yet Canadians’ own choices reveal considerably far less attachment. They may like the idea of VIA Rail or the CBC without riding its trains or consuming its programming.

Public policy should take those revealed preferences seriously. Governments routinely claim to act on behalf of Canadians while discounting the clearest evidence they provide about what they actually value.

Thunder Bay can celebrate the jobs without the rest of us pretending that the real question about VIA Rail has been answered. Before spending billions to give a chronically subsidized and lightly used passenger railway several more decades of life, Ottawa should ask whether Canadians have already rendered their verdict—and whether the government simply refuses to hear it.