The operators of the QLine are plotting a pandemic comeback to get the Woodward Avenue streetcar rolling again by late summer.
M-1 Rail, the not-for-profit owner of QLine, has canceled its operations contract with Transdev Services Inc., the Lombard, Ill.-based transportation management that has operated the streetcar since it launched to great fanfare in 2017.
The streetcar should be back up and running by late spring after M-1 Rail hires and trains drivers and mechanics and goes through testing of the track and cars before resuming service to the public by late summer, spokesman Dan Lijana told Crain's.
"We brought the services in-house because the level of service that the outside provider was providing wasn't in line with our service expectation," Lijana said Monday.
Transdev's original five-year $15.5 million contract dating back to 2016 was set to expire June 30 of this year; M-1 Rail incurred no cost to cancel the contract, Lijana said.
"We're looking at it as a fresh start," Lijana said.
The QLine's fresh start also includes a new day-to-day leader at M-1 Rail's Penske Tech Center, the streetcar's operations facility along Woodward Avenue in New Center.
Lisa Nuszkowski, founder of Detroit's bike-share nonprofit MoGo, joined M-1 Rail full time as the organization's new president on Jan. 1 after coming onboard part-time last July, Lijana said.
Last week, Nuszkowski announced publicly she was leaving MoGo, but didn't say where she was going.
The QLine halted service March 29 during the height of the first wave of COVID-19 infections in Michigan. It has not operated since, idling a 12-stop, 3.3-mile mass transit route that runs from Congress Street downtown to Grand Boulevard in New Center.
Nuszkowski's first big challenge will center on hiring a general manager to run the technical end of the business managing drivers, mechanics and technicians that Transdev previously supplied under its contract, M-1 Rail CEO Matt Cullen said.
Transdev had "constant staffing problems" that affected service, Lijana said.
"It's just never worked out the way that we expected," Cullen told Crain's. "They just didn't operate the way it needed to be operated. ... And it required us to be much, much more active in the day-to-day activities."
Some M-1 Rail employees returned to work last year as the organization made plans to cut ties with Transdev. Drivers and mechanics who worked for Transdev will be recruited to work for M-1 Rail, Lijana said.
Nuszkowski brings a "big depth" in public-private partnerships from her ground-up launch of MoGo and an operational background that M-1 Rail needs to reintroduce the QLine to downtown Detroit workers and visitors after the pandemic ends, Cullen said.
"We really wanted to have a second opportunity for a first impression," Cullen said. "We really want to make sure when we relaunch that it's operating the way it should be. And (Nuszkowski's) passion for transit and the customer service I think will be important to achieve that."
"We want to demonstrate value as we relaunch," Cullen added.
Cullen remains the volunteer, unpaid CEO of M-1 Rail. But Cullen has never been day-to-day chief executive, in part because of the several hats he has worn in Rocket Companies founder Dan Gilbert's business empire, which Cullen exited last summer after a stint as CEO of Bedrock LLC.
Cullen has since become chairman and principal of Jack Entertainment, the Cleveland-based casino business Gilbert previously owned. Cullen and his business partners bought Gilbert out of the last two Ohio casinos in December.
Gilbert and Cullen were among a group of business and foundation leaders in town who were instrumental in getting the $140 million QLine constructed with a mixture of corporate and philanthropic donations as well as taxpayer grants. Gilbert's Quicken Loans bought the naming rights to the streetcar.
The QLine had just over 1 million riders in 2019 or about 3,000 rider trips per day, Lijana said.
Beyond revenues from fares, the QLine's operations have been subsidized by a mixture of private donations and taxpayer support.
In September, the Michigan Legislature approved a $15 million earmarked appropriation for M-1 Rail's operations spread over three years to help restart operations.
In the 2019 fiscal year, the last full year the QLine operated before the pandemic, M-1 Rail's total operating budget was $9.47 million. Transdev was paid $3.1 million annually to manage and operate the streetcar, though its contract did not cover all of the operating costs M-1 Rail incurred, Lijana said.
Since its inception, the long-term financial viability of the QLine has always been a question mark, especially after the streetcars first few years were plagued with operational problems. The most common service delay stems from vehicles parked on Woodward Avenue blocking the tracks — an inherent problem for a fixed-rail form of mass transit sharing lanes with passenger vehicles and buses.
"It will always require support," Cullen said. "There's no transit system anywhere that operates on the fare box."
The QLine's route times also were hampered after Red Wings and Pistons games and concerts at Little Caesars Arena let out and vehicles clogging up the tracks brought the streetcar to a crawl some nights.
Lijana said M-1 Rail's leaders are actively looking for solutions "to ease the path of the QLine along the route."
"We feel much more in control of the outcomes than we did with the vendor," Lijana told Crain's.
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