Skip to Content
Streetsblog California home
Streetsblog California home
Log In
Public Transportation

The Problem With America’s New Streetcars

Detroit’s 3.3-mile QLINE streetcar, funded in part by a $25 million federal grant, saw ridership drop 40 percent after introducing a $1 fare. Photo: Wikimedia Commons

One of the hallmarks of federal transportation funding during the Obama administration was a new willingness to support streetcar projects. With the first wave of these projects now in service, their shortcomings are becoming more apparent.

A report published earlier this year in the Journal of Transport Geography sheds light on the limits of these streetcars: They were always intended mainly to spur real estate investment, not to address urban mobility needs. As author David King explains, streetcar backers were often more concerned about land development than the transportation system.

The new streetcar segments typically run a short distance -- a few miles at most -- in mixed traffic, and they aren't well-integrated into existing transit networks. So it should come as no surprise that ridership is often underwhelming.

On Detroit's QLINE streetcar, for example, ridership dropped 40 percent after M-1 Rail, the company that operates the 3.3-mile route, started charging a $1 fare last month. Passengers now take about 3,000 QLINE trips each day. A spokesperson for M-1 Rail told NextCity he "fully expected ridership to dip a little bit" once the fare took effect.

The primary benefits of streetcar projects were always intended to be related to development. King examined the official cost-benefit analyses that streetcar sponsors submitted to the Federal Transit Administration. About three-quarters of estimated benefits derived from economic development, not transportation-related improvements, he found.

Graph: Journal of Transport Geography
Table: Journal of Transport Geography
false

King identified 12 new streetcars in operation and a few dozen more in various stages of development. All told, local and federal government spent $866 million on streetcars between 2009 and 2013, he reports, with 32 percent coming from the White House's TIGER grants. Several of the projects were subsidized with local tax incentives or special sales taxes.

The new wave of streetcars have a regressive effect, King writes, because the costs are widely distributed while the benefits are concentrated in the form of higher land values. Ironically, he says, that helped boost political support for streetcar projects, many of which are backed by business associations and downtown property owners.

Cities may have valid reasons for seeking more downtown investment, but these streetcars should be recognized for what they are: economic development projects, not solutions to the transit and transportation problems cities face today.

Stay in touch

Sign up for our free newsletter

More from Streetsblog California

StreetSmart Special Edition – LA Evictions at Caltrans Owned Properties for Formerly Homeless “Reclaimers”

Benito Flores, one of the Reclaimers, is resisting eviction to draw attention to inequities with how housing laws are being applied to people experiencing homelessness

July 15, 2025

Tuesday’s Headlines

I bet we can come up with some reasons Sacramento isn't getting higher scores on its bike ratings.

July 15, 2025

Commentary: The French City of Lyon Shows How to Connect Oakland and Western Alameda

An amazing 24/7 bike-ped-transit connection can be made for pennies on the dollar—if the Bay Area can get past its car-brain affliction.

July 15, 2025

Monday’s Headlines

R's clearly think gas prices are the way to hold on to the house.

July 14, 2025

These U.S. Communities’ So-Called ‘Complete Streets’ Policies Don’t Even Deserve the Name

Any city can call itself a "Complete Streets" champion. But not all of them are walking the walk — and if they don't, a top organization says they'll no longer give them a platform on its esteemed "best of" ranking.

July 13, 2025
See all posts