Class Is cite workforce, production cutbacks during 4Q conferences
Senior executives at the six largest Class Is broached the subject during their fourth-quarter earnings conferences held the past week. Union Pacific Railroad EVP and COO Dennis Duffy said the Class I furloughed 3,150 workers — mostly train and engine-service crew members — and placed 48,000 cars in storage by 2008’s end. In addition, UP placed 1,200 locomotives in storage.
BNSF Railway Co. CEO Matt Rose said the railroad laid off about 2,000 workers by late 2008 and expects to furlough a total of 2,500 employees in first-quarter 2009, and Canadian Pacific CEO Fred Green said his road’s temporary furloughs peaked at 1,450 in late 2008 and currently number about 1,000.
But no senior exec went into as great a detail about workforce and production cutbacks as Norfolk Southern Corp. Vice Chairman and COO Stephen Tobias. During a Jan. 28 earnings conference, he said NS’ T&E forces had declined from 12,380 in April 2008 to 11,622 in mid-January 2009, mostly through furloughs and curtailed hiring.
“We began furloughing in October and anticipate furloughing an additional 100 T&E employees in the next 30 days, bringing the total to over 500,” said Tobias “Generally, as reductions in train operations are made, they are followed by reductions in other departments, such as mechanical.”
NS also stored about 20,000 cars — including coal, intermodal and multi-level equipment — by year’s end.
“Our timely car storage focus enables us to right-size our car types to customer requirements and minimize our costs,” said Tobias.
As transportation planners made significant reductions to NS’ operating plan in November and December, they adjusted the locomotives fleet’s size, as well. During the two-month period, the railroad reduced in-service locomotives by 127 units, including 79 through short-term lease turn-backs and 48 placed in storage, said Tobias.
Other “right-sizing” measures include train and terminal plan reductions. Beginning in mid-October and accelerating in mid-November, NS removed train starts from the operating plan.
“Over Thanksgiving, we curtailed operations for the first time in over a decade,” said Tobias.
By 2008’s end, the railroad cut more than 60 network trains from the operating plan, plus local and yard jobs totaling 43,800 train starts.
In terms of terminal plans, the Class I reduced operations at facilities in Columbus, Ohio, Sheffield, Ala., and Reading, Pa.
“We continue to analyze all of our yards and are making adjustments as appropriate,” said Tobias.
All Class Is likely will continue to adjust their workforces, especially if the recession persists. Layoffs have reached the point that 12 percent of United Transportation Union (UTU)-represented workers have been furloughed, said UTU National Legislative Director James Stem Jr. Jan. 28 at a hearing conducted by the House Transportation and Infrastructure Committee’s Subcommittee on Railroads, Pipelines and Hazardous Materials.
Unfortunately for the nation’s unemployment level — which continues to rise and soon will factor in tens of thousands of layoffs just announced by several major U.S. companies, such as Boeing, IBM and Starbucks — Stem expects that percentage to go up.
Posted by: 
Jeff Stagl | Date posted: 1/29/2009
Comments
Posted by csxengineer on 2/3/2009 9:43:59 AM
i knew the economy was bad this kinda puts it into simple terms. csx,ns,bnsf & up have said they have 128,000 cars in storage, comapared to 4 years ago when they had none in storage. those 128,000 cars would make a train 1,455 miles long. and with the utu saying 12% of it members are furloughed. myself, i think when the economy does turn it's not really going to rise back to what it was but go sideways. people will become like our grandparents and only charge when you have a major reason too, which won't increase demand for the rr's i hope i'm wrong.
Posted by tahoevalleylines on 2/4/2009 6:38:00 PM
Railways used the depressed 1930''s to bring forward some of America''s most important contributions to railway motive power, putting technicolor to steam (and squeezing 100mph out of some designs) and making diesels the new wave, led by the GM Train of Tommorrow FT tour. Will it take another automaker, cognizant of the need for railways in the economy to sell cars, to come forward this time around? It is different this time, if Boone Pickens and R. James Woolsey and theoildrumdotcom are correct on their transport fuel supply position: near impossibility of achieving the oil production levels of the 2007-''08 period. These authorities (Rail Execs talk to Matt Simmons (713-236-9999) suggest shelving of new oil extraction and production projects due to investor pullout will make it difficult to achieve previous levels of volume. Compounding this is the IEA Nov. ''08 report which includes a much larger than anticipated oilfield depletion rate. In other words, depletion rate of old fields is near growth rate of new production coming on line. International Energy Agency is a reputable source; rail execs are encouraged to make independent assessment of the references noted. What this means is, the railways, moreso than anytime since the Second World War, will be called upon to pick up the slack from long haul trucking problems, and to a larger amount year by year going forward. This is going to be a very serious national vulnerability. It will call for maximum utilization of every available unit of rolling stock and motive power. The capacity limits once reached will most likely show need for all due haste increase of fleet, and support facility expansions. Additionally, rail and track hardware demand will precipitate hold on some level of steel scrap exports, to gurantee supply for domestic railways. It is also suggested as this becomes an undeniable turn of events regarding need to expand, rehab and rebuild railways, the US State National Guard Units re-commission the ir respective Railroad Operating and Maintenance Batallions. This will assure flow of rail savvy personnel for the private sectos, beyond the Guards'' logistics and disaster recovery role of pre-Vietnam Era. Last reference: see James A Van Fleet''s "Rail Transport and The Winning Of Wars", from AAR (202-639-2100). Interesting comments on dangerous dependence on oil imports from the General...
Posted by michael willis on 2/6/2009 7:52:02 PM
ALSTOM President Americas Pierre Gauthier was interviewed by "Street Signs" CNBC TV host Erin Burnett at 2:15 Friday 6th of February 2009. go to www.cnbc.com then to video "Impact of Stimulus on Jobs". Stimulous or not Mr. Gauthier of ALSTOM has visionary infrastructure expansion plans for the USA. Erin Burnett asked Mr, Gauthier- "You are opening a plant in Chatanooga? "Mr. Gauthier-"That''s correct,it''s in the building mode now and it should create 350+ American jobs building steam and gas turbines for the American market and other markets around the world"." We are in an infrastructure industry which works long term and therefore these investments were planned and we are continuing them". During the CNBC TV interview the test run of the TGV ''Tre Grand Vitesse''-''Very Great Speed'', the worlds fastest train was features on a split screen. A French Air Force jet with a mounted camera was required in order to keep up from above with the 475kph supertrain! A stimulus would be a tremendous boost and speed things up for railway infrastructure investment in the USA. After more than 50 years of being vanquished, America is ready to welcome back passenger railroads and make them an integral and visible part of our daily lives and cities again. By the way, a family member of mine works for ALSTOM, and many thousands more American skilled workers, engineers, transport management, IT professionals and train passengers can look forward to an efficient and prosperous future with TRAINSPORTATION INFRASTRUCTURE. TRANSPORTATION POLICY=ENERGY POLICY
Posted by MICHAEL WILLIS on 2/9/2009 8:15:52 PM
"THE POOR WORM" I will describe a cartoon by -"ROSE of THE BOSTON HERALD-1940". A 2-6-4 steam locomotive puffing along a track with an anxious expression on its facade, its boiler slightly crumpled is being followed from above by 5 enormous black vultures. The (subsidized) birds of prey were in this order: AIRLINE COMPETITION-BUS COMPETITION-TRUCK COMPETITION-PIPE LINE COMPETITION & INLAND WATERWAY COMPETITION. Taken from PAGE 84 of "MODERN AMERICA" "The causes of the railway smash are very complicated and and can receive only summary treatment here. Rail transportation absorbs about ten cents of the consumer''s dollar. In good times railroads employ more than a million men to whom they pay two billion dollars a year in wages. They are alrge consumers of steel and other HEAVY GOODS; and the income from their stocks and bonds held by banks, insurance companies, and private investors greatly affects spending and saving in the nation. The railroad problem is important because our economic order order could not work an adequate transportation system, THE BACKBONE OF WHICH IS THE RAILROADS. -by Maurice B. Rovner of McKinley Vocational High School, Buffalo, New York revised edition-1942. COLLEGE ENTRANCE BOOK COMPANY NEW YORK. There is a rumor out there that the dysfunctional and grossly inefficient US transportation system is being ruled by subsidized OPEC powered vultures?
Making a case for Midwest high-speed rail — from Spain
"If you could get from the Twin Cities to Chicago in equal the time it takes you to go to the airports and fight through everything and you can end up in downtown Twin Cities or downtown Chicago and it's on a good, new high-speed, comfortable train, then I think you're going to see a lot of demand for it," Doyle told members of the Greater Milwaukee Committee, according to a Milwaukee Journal Sentinel report.
That’s exactly the point members of the Midwest High Speed Rail Association have been trying to make for years. This week, some association members are in Spain, touring the country’s high-speed rail and other passenger-rail systems, and pondering how Spain’s rail network could be duplicated in the Midwest. Participants also are meeting with officials from Spanish railways to learn about their rail expansion plans and the progress to date. They’ll also tour Talgo’s manufacturing facility.
“Spain offers the best example for what we should be doing with high-speed rail and rail transit in the Midwest,” according to the association’s Web site.
In addition to its high-speed rail system, which operates trains at speeds up to 220 mph, Spain has doubled its transit network during the past decade, adding new light-rail lines throughout the country. Spain’s commuter-rail lines also are being upgraded to handle 155 mph trains.
In 2005, the Spanish government allocated nearly half of its total transportation budget to railroad construction and improvements. Once the improvements are made, no city in the country (“A territory embracing an expanse equal to the distance from Minneapolis to Pittsburgh and from Kansas City to Detroit,” according to Midwest High Speed Rail Association Executive Director Rick Harnish) will be more than three hours away from Madrid by train.
Tour participants are learning just how convenient Spain’s high-speed rail system could be if it were replicated in the Midwest. Last weekend, they took a day trip to Seville, about 300 miles from Madrid (or, about the same distance between Chicago and Detroit or St. Louis). The group left Madrid at 7:30 a.m., spent five hours sightseeing in Seville, and got back to Madrid in time for dinner.
“This trip illustrates how high-speed rail changes the relationships between cities,” Harnish wrote in his daily wrap-up on Jan. 11. “My summary for the day: We really need high-speed rail in the Midwest.”
As a fellow Midwesterner, I concur.
Posted by: 
Angela Cotey | Date posted: 1/14/2009
Comments
Posted by t l koglin on 1/14/2009 2:10:10 PM
OK Great! Lets get going. We can beat California to the punch. But what are we going to have? A line from Chicago to Green Bay to Minneapolis? It would be productive for the state agency responsible to proivide a little more information to the public about what they plan to do. Is there any P.R. being performed here?
Posted by Peter Oster on 1/14/2009 5:54:13 PM
High-Speed Passenger Rail is the way to go in the Midwest! Let’s get going! We should have had it years ago! Governor Doyle''s comments about the inefficiency of using airlines for short hops to Detroit, Chicago, St. Louis, etc. are correct. I have regularly commuted to these cities to work, by air and always thought it would be so nice to be doing it by high-speed rail rather then by air and saving time for sure. High-speed rail in the Midwest would be a huge economic engine for the entire region. Airlines are fine for the long hauls across the country. For years, I have commuted on the Amtrak - Hiawatha from Sturtevant, Wisconsin into Chicago for work. Even though this isn’t high speed rail (79 mph at best) I have always enjoyed the fact that I could commute about 70 miles into Chicago on Amtrak in less time then all the Chicago Metra commuter rail lines could make it in from their most distant Illinois stations. If only Amtrak had some new and clean cars. If there was high-speed rail that would really be something! Since the United States has waited so long for high-speed rail we will be the recipient of a great savings utilizing European, Japanese and Korean fully developed technology. The Republicans have been fighting high-speed rail and funding for Amtrak for years. With the new administration maybe something will be done. Interstate transportation needs Federal government support. The Interstate highway system and the airports have hogged the support for too long. It is time for a change to regional high-speed rail!! Pete
Posted by H.J. Kelly on 1/15/2009 11:40:19 AM
Seems like forever that we have been talking about High Speed Rail. FL, TX, CA and the Midwest. The Northeast is the only place that comes close. This may be a good time for a funding/work stimulas package from the new administration. As painful as it seems keeping gas prices up may finally get some people out of their cars.
Posted by A Railroader Who Remembers Things on 1/15/2009 1:54:51 PM
High speed rail in the Midwest makes a lot of sense. However, Governor Doyle is probably not the individual to get too specific about it. The important thing to remember is that High Speed rail needs a route that approximates a straight line as closely as possible. The old Milwaukee Road Hiawathas between Chicago and Milwaukee demonstrate this. The distance by rail from Union Station in Chicago to the Milwaukee Road Station in Milwaukee is about 86 miles by rail and nets out to about 81 miles "crow-fly". The best schedules 50 to 70 years ago between the stations were 75 minutes. That required top speeds of 100 miles per hour or more to reliably achieve. Yet the net average speed would be just under 65 miles per hour. Trains that made two stops added 10 minutes to the schedule. That dropped the average net speed to under 58 miles per hour. Why did this occur? Because when a passenger train leaves Union Station it travels at a slow speed for about a half mile until it goes around a sharp curve to the west. Then it travels west for over two miles without making any real progress towards Milwaukee at a moderately slow speed. At Western Avenue, it then turns northwest and begins to make some progress towards its destination. Finally, in Milwaukee, it slows and curves back and forth a few times before again making a slow speed, sharp turn to the west into the station there. How does this relate to the proposal for trains between Chicago and Minneapolis? (Although politically I might have said "the Twin Cities". The Minnesota state capital city, St Paul, has its pride, too.) The net distance between Downtown Chicago and Minneapolis is about 355 miles. Passing through Madison adds a negligible distance. Passing through Milwaukee adds nearly 30 miles. Milwaukee plus Madison would add about 37 miles, for a total end to end distance of about 392 miles. Routing the trains by way of Green Bay and Milwaukee, but not through Madison, would result in a distance of 445 miles or more, an increase of about 25% to the distance to be travelled end to end. Why does this matter? Because the person travelling does not care how long the track is. That traveller cares how far the destination is from where the trip starts and the time it takes from leaving to arriving. To make the same overall trip time, the vehicle must travel that much faster on average to make-up for the added distance and the top speed must increase even more to make up for the time spent in stops along the way. An increase in the length of the tracks makes them that much more expensive to build initially. It also leaves the system with that much more track to maintain. The faster and farther the trains need to operate increases the amount of energy that will be consumed. And increasing the speed also increases the amount that will be needed to maintain the track and the train equipment. Curved track further increases the amount and cost of maintenance needed for both the track and the equipment. Then there is the matter of the technology. The high-speed network in Spain, I believe, was conceived with a specific intent that trains would someday be able to be operated through into France on their TGV network. The French rail network also is designed to allow some operations through into Belgium, Germany, Italy, Switzerland and other European Countries, even Great Britain. This does not mean that it will not operate in Wisconsin. Far from it. Rather, it means that the Spanish technology borrows freely from that in other countries. Even the Acela trains that Amtrak operates in the USA share some of the technology. It would appear, therefore, that a more appropriate statement on technology would be to look at the many variations around the world and see if trains such as those in Spain, France, Germany, Great Britain, Norway and Sweden do not have a great deal to offer for service northwest out of Chicago. They obviously do. But I mention Norway and Sweden because the climate in Spain is so much warmer in winter than that in Wisconsin. Canada, too, has points to offer. It is simply too early to lock onto one set of solutions. We should be looking for the best the world has to offer.
Posted by James Swidergal on 1/16/2009 12:57:35 PM
If it the best solution your looking...for ...comparably with temperature,topographical,and similar attributes, perhaps we need to look at China's high speed system that runs tween'Bejing and the former capital of Tibet (I think) they've accomplished many obstacles by using a raised trackbed bridgelike structure, for more on the specifics and to view the building of this high speed system I believe it was on Discovery Channel, or possibly History Channel,about 6 months ago.
Posted by Peter Cooper on 1/17/2009 12:03:31 PM
I wonder if the people that have submitted comments supporting high-speed rail are ready to buy stock in the venture instead of goading the government to fund the project at 7 times the cost necessary to do the job! The only practical way to build passenger rail is to phony up the money our selves. Please contact me at the Pan-American Railway Inc. if you are ready to particpate.
Posted by Larry Krieg on 1/18/2009 7:48:57 AM
The Chinese line from Golmud to Lhasa, Tibet, is not a high-speed line. Its distinction is its altitude, highest in the world at 16,460 ft. above sea level through Tanggula Pass. Much of it is constructed over tundra with special engineering to protect the permafrost. Seventy-eight of the locomotives are diesels specially built by GE in Eire, PA; the passenger cars, equipped with oxygen for passengers, are a joint venture between Bombardier and China''s Sifang Group, which built the cars in China. There are three originators of true high-speed rail technology: Japan, France, and Germany. Spain uses French (TGV) technology, and Korea has developed its own trains based on the TGV; China so far has opted for German technology. Taiwan has adopted the Japanese Shinkansen system. The US''s Acela is a hybrid based on Swedish X2000 and Bombardier designs, though with a top speed of 240 km/h it is hardly in the same league as the German, Japanese, and French systems, all of which operate trains at 300 km/h or higher. Speaking realistically, it is unlikely that we in the Midwest will get high-speed service in the same category as Germany, Japan, and France. California will undoubtedly beat us on that, since these systems take decades to plan and build. But let''s not give up: more important than speed is reliability. If we can work for reasonably rapid service with 99% on-time reliability, trains will become the mode of choice for intermediate regional travel in the Midwest. Having recently returned from a three-week exploration of Japan''s rail system, I know there are really good technologies and operating techniques for rail systems of the type we have in the US - 19th century ROW, freight+passenger service, as opposed to specially-built high speed lines for passenger-only service. We have a lot to learn from Japan and Europe, if only we can overcome our "not invented here" prejudice. And the best news is, it can be applied in the near term.
Posted by Larry Kaufman on 1/19/2009 10:22:57 AM
There are just a few problems with the idea that we "pony" (not phoney) up the money ourselves for high speed rail. Most obvious is that passenger service doesn't make money anywhere in the world. It certainly does not in the U.S. Amtrak has been starved for funds throughout its 38-year existence. I wonder if the advocates of diesel-electric propulsion had to face the same kind of opposition to the converstion from steam that high-speed advocates must face. There probably are some corridors with sufficient density that could justify the public investment in high-speed rail, but most will not and we really ought to focus on providing good, reliable passenger service through much of the country, whether simultaneously or separately.
Posted by Vincent B. Mottola on 1/19/2009 11:19:26 AM
I also concur with the proposal for high speed trains in the Midwest; particularly from Chicago thru Milwaukee and on to Minneapolis, MN as the governor suggested; this would enhance business calls by salesmen and sve an enormous amount of money spent on gas and auto expenses...a huge part of a salesman''''s monthly expenses. In addition, there will be more of an insentative for the average every day travelers to vist relatives and friends that live in the areas designated. Why procrastenate? What do you suppose progress is all about? Lets put our engineers and lay people to work that will create the jobs our elected President Obama has been talking about for the past several months...just do it! Thank you for allowing me to express my opinion!
Posted by Al Holleuffer on 1/21/2009 6:52:24 PM
This country should hang its head in shame. We should have had high speed trains before the Japanese built the first line there. Several third world countries are currently building their own systems while we still do little more than talk about how great these things are. Hopefully the new administration will give it the push needed not just in the midwest but other corridors throughout the nation. We must lose the hyway mentality that has prevailed for too long strangling our metropolitan areas and polluting our atmosphere.
Posted by Larry Kaufman on 1/22/2009 11:25:35 AM
Sorry, but I do not choose to hang my head, either in shame nor dismay, at the lack of high-speed rail in the United States. Nor am I anti-high-speed rail, either. I like to think I'm just pragmatic. Japan, France, Germany, and other countries that already have high-speed operations are not at all like the United States. For one thing, their governments own and control all rail rights of way in those countries, and frequently own and control the operations, as well. Anyone want to see the U.S. government own the rail rights of way in this country and/or the operations? I didn't think so. Second, having ridden the Shinkansen in Japan and having found it a most efficient way to get from one city to another in that country, I suggest that the dissimilarities are greater than the similarities. Few Japanese or Europeans have multiple cars; distances are significantly different than in this country and make high-speed rail more economical than here; and there is much greater willingness on the part of the citizenry to have their governments operate transportation systems. Let me know when Americans truly support government provision of high-speed rail. Until then, this is just so much chit-chat, as the private sector certainly will not put its money into a venture that cannot earn a return on investment - nor should it. Remember, passenger operations, whether high- or low-speed, do not make money anywhere in the world. Sign me "holding my head up with no shame."
Posted by tahoevalleylines.org on 1/26/2009 4:44:54 PM
Pan American Railway is in Boise Idaho; they are one of few entrepreneurial (not an existing rail operator)approaches to railway expansion currently putting out feelers. Another is Suntrain Transportation Corporation, in California. Both companies have been looking at combination branchline rehab & upgraded mains,; creation of railway SYSTEMS to bring rail back to local interface, as seen in the pre-WWII USA model. An interesting discussion of these ideas can be found in Christopher C. Swan''s book: "ELECTRIC WATER". Larry Kaufman''s comments are good, I do take exception on the pros & cons of Public Ownership (of rights of ways)... Airports, Highways, Navigable waterways are public owned. Maybe case by case will sort out an expedient path to re-establishing US "Second Dimension Surface Transport Logistics Platform" -railway matrix. Consultancies and political staff & agencies looking at rail mode in the Peaking Oil Solution Set would move this enterprise forward ASAPO by getting an electronic map of all the US rail lines past & present. This map should show existing lines and track capacity, branchlines extant and rebuildable, and former corridor. Next level, all previous rail and Interurban Electric Rail corridor should be evaluated, including warehousing and truck interface facilities, like military bases, etc. Many warehousing complexes have rail access, but paved over, etc. Baby step into this railway redux by re-commissioning all the State National Guard, other services, "Railroad Operating & Maintenance Battalions" as functioned from the Civil War into the Vietnam Era. Not just a drill, these assets were/will be invaluable for disaster recovery, and shall provide pool of rail savvy men & women for the US Rail companies. Modest plans on a page can be seen at the Association For The Study Of Peak Oil & Gas, (peakoil.net) articles 374 & 1037. US Rail Map Atlas volumes for all 48 states can be obtained at (spv.co.uk). Nonetheless, this mapwork should be made into an electronic archives as well, so any of the 3066 US County Planning Bureaus can search & print out map of their respective rail footprint, warehousing track geometry, and thus determine priority for rehab & re-connect. Substantial increase of handling facilities for containers is an obvious adjunct to this shift back to rail emphasis, helpful along mains where smaller (now runthrough)stations and load/unload sidings were the rule. Alaska & Hawaii had some freight rail and opportunity/need to expand same. The Spreckels Empire, Pacific Electric Railway is a useful study for the day passenger, night freight/victuals sort of rail operations needed as trucking falters in an energy crisis. Cal Trans Division of Rail (Will Kempton) has copies of the I-80/US50 Reno-Tahoe Rail Corridor study, (Unabridged) which is a useful textbook for planners used to highway thinking. the 1995 CaDOT study noted explains upgrading existing (80 Corridor)rail lines, as well as rehabbing unused (Truckee to Tahoe City) branches, and engineering brand new US 50 Corridor) railway line. Other details in Federal RR Rehab guidelines should include period of stockpiling portion of ferrous scrap export volume, as US ramps up railway track hardware and rail manufacturing capacity. Inventory tax, a big factor in the rails-to-trucking shift, should be relaxed in favor of rail warehousing methodolgies. "Just-in-time" is going to be an early casualty in the energy crisis. Last comment in HSR here: Hiogh Speed Rail is a vanity, unless it is done in a greater planning process that includes freight movement, terminal development keyed to public not private transport, and renewable power as much and as early as practicable.
Posted by Larry Kaufman on 1/27/2009 4:38:29 PM
Lord save us from zealots who know not what they are talking about. The website tahoevalleylines.org does not exist. tahoevalleylines.com does, however. Pan Am Railway may or may not be in Boise, Idaho, but Pan American Railways in New England is the former Guilford Transportation Industries, which changed its name in 2006. It had acquired the name Pan Am by purchasing it from the estate of the bankrupt Pan American World Airways. The credibility of the writer above is open to question as he wasn't able to get his own identity correct.
Posted by J.C.Hare on 1/28/2009 12:54:18 PM
Is Spain part of the US now? Let's spend the "New Found Money" in the US.... Spain??? High Speed Trains???? J. C. Hare CEO... Transit Systems management, Inc.
Posted by michael willis on 1/28/2009 5:22:48 PM
'AMTRAK I' The new Presidential locomotive and passenger and coach set. AMTRAK I will be as technologically advanced and equipped for travel as Air Force I and will be the most secure and comfortable train set ever conceived. All necessary communications, dining, conference, sleeping and private office facilities will be provided for President Obama to conduct official business en-route. Think of AMTRAK I as a WHITE HOUSE ON RAILS. As was expressed during the Inaugural Train excursion, President Obama & Vice President Biden made a very statement for their support of a vibrant US RAILWAY SYSTEM and the vital RAILROAD INDUSTRY.
Posted by Larry Kaufman on 1/29/2009 10:46:17 AM
If the U.S. ever gets an Amtrak 1 as described (or is it phantasized?) by Michael Willis, that would be very reassuring for all citizens. Sorry, but trains simply will not beat air for time from origin to destination, with the possible exception of a few corridors like NY-Washington. So, if President Obama ever really travels by rail on Amtrak 1, we all can rest assured that the world is in good hands and that there are no crises that require the President's personal attendance.
Posted by Larry Kaufman on 2/4/2009 1:09:21 PM
Now that CN has closed on its purchase of the EJ&E and is planning the integration of the outer-belt railroad around Chicago into its system, some suburban Chicago interests still are trying to negate the transportation efficiency that results from the CN transaction. Rep. Peter Roskam (R-Ill.), one of a band of Illinois legislators who tried everything in the book and a few things not in the book to block the EJ&E purchase (their constituents were waging a classic NIMBY - not in my back yard - fight). Under the guise of support for a new Metra commuter line connecting Chicago suburbs and O'Hare International Airport, Roskam has introduced legislation to support the so-called STAR route. It doesn't take a too terribly close look to see that Roskam and whoever will support him really are trying to undo the CN acquisition of a more efficient route for its traffic around Chicago. STAR has been hanging around for some 30 years and no one - including Roskam - showed any inclination to fund it for Metra until now. The draft legislation would declare a commuter corridor and freight could be tossed off the commuter corridor. Aha! See where they are going with this one? These are the same Illinois politicians who stiffed the CREATE public-private partnership that some day may alleviate much of the rail congestion in Chicago by funding construction of four freight and one passenger corridor through the city along with over- and under-passes that will help truck and auto traffic. CREATE was the result of several years of negotiation between the railroads that serve Chicago, Amtrak, Metra, Illinois DOT and FRA. Rather than fund the federal share, though, Illinois pols "stiffed" it and chose to fund their favorite pork projects in the last surface transportation authorization. The sudden conversion of Mr. Roskam to being a supporter of METRA rings kind of hollow. If they hadn't tried to throw their political weight around and block the CN transaction, their miraculous conversion might be a bit more believable. As it is, it isn't believable at all.
Indiana Honda plant a prime example of short lines' marketing potential
Doesn’t sound too earth-shattering? Here’s why it is: The Honda plant is the first automotive manufacturing facility to be built on and primarily served by a short line.
The automaker had considered building the plant in Illinois, Michigan, Ohio and Wisconsin, but chose the Indiana site in part because RailAmerica Inc.-owned CIND offers multiple railroad connections between Cincinnati and Shelbyville, Ind. In addition to CSXT and NS, the 81-mile short line interchanges with Canadian National Railway Co. and the Indiana & Ohio Railway Co.
The plant, which opened last summer, is being tooled to produce Honda Civic sedans. After the facility reaches full production capacity, more than 80 percent of the assembled vehicles will be transported via rail — outbound traffic that could total 8,000 carloads annually.
That’s a big boon to CIND’s traffic, just as landing the plant is a big marketing feather in the cap for both the railroad and short-line industry. The facility serves as a prime example of short lines’ ability to compete with Class Is for major industrial development projects, as well as their aptitude to work with Class Is to provide major shippers a total long-haul transportation option.
With Honda breaking the proverbial ice and CIND showing it can be a primary transportation provider, I expect a few more automotive plants to spring up along short lines in the near future. That is, if the economy rebounds and consumers become active auto buyers again.
Posted by: Jeff Stagl | Date posted: 1/7/2009
Comments
Posted by Kenneth Pritchard on 1/8/2009 1:46:51 PM
The Wabash Central Railroad stands ready to assist a progressive industry in a plant building on its rail line in Indiana and offering rail service on an 'as needed' and cooperative basis. WBCR has a direct connection with Norfolk Southern Ry at Bluffton, Ind. providing excellent rail service to all destinations throughout the U.S.A., Canada and Mexico.
Posted by James Mancuso on 1/9/2009 10:41:02 AM
If it works in Indiana in the case of that Honda plant, there is no reason why it should not work in Buffalo,NY,which still has more than two major railroads plus several short lines serving its industrial needs. Depending on what part of the city a shipper decides to put his plant, he would have a nice choice of railroads with which to do business via the shortline he may locate on, such as the Buffalo Southern, which would give him a choice of more than two railroads if you include CN and CP in the mix.
Posted by Shaderick May on 1/9/2009 10:56:14 AM
This is a Captivity Issue. When advising clients, shippers, on plant location the first choice is a point that is served by more than one Class I railroad; usually this is not an alternative. The second best choice is always a short line with access to more than one Class I and no encumberances, fees to the original parent Class I. what's needed to obtain this type of business is a long-term contract with the short line that protects the shipper from captive railrates while still providing a reasonable rate of return to the short line.
Posted by James Swidergal on 1/9/2009 12:22:04 PM
More of a question than a comment...If this is true of Shortline involvement and the "boom" for present and aspiring shortlines everywhere then why in the world would a shortline namely the EJE surrender and sell out to a Class1 namely the CN. OK sure,I see the CN''s point of view to bypass the Chicago maze of traffic, but as the shipping environment continually moves out into the surrounding (suburbs) of the Chicagoland area, I would think that the administration for the ex-EJE would have had the foresight to expand expotentially and make the EJE one of those Highly touted shortlines that it could have been. The EJE just as it sits right now before the CN takes control,is in a perfect geographical and possibly economical location, not only does it skirt the congested Chicagoland area, but with an adjustment or two concerning additional rail, increasing infrastructure, the EJE by itself could have not only served and made money at it,but could have expanded into the suburban passenger service link that is so desired especially now. The EJE''s property (for those of you unfamiliar) wrap around and pass thru some of the most up and coming communities along its entire line and would have created a boost for those communities that are already existing and even a bigger boost to those that are in trouble. The Eje connects with all of the Class1''s either directly or thru it''s link with the BRC and the Indiana Harbor Belt. I''m all for shortlines especially The EJE,making it and making it big,and they (eje) could have if they didn''t sell out for only $300million(I wish I had). The EJE story could have been the most exiciting not only monetarily, but astethically, in that it has two working roundhouses one at Kirk and another at Joliet,along with working turntables,along with picturesque right of way, along with experienced manpower,to make it happen. Once again it''s a story of David and Goliath and Goliath won again! This is one shortline story that doesn''t have a happy ending.
Posted by Larry Kaufman on 1/9/2009 3:51:03 PM
Everything you say about the EJ&E, James, is correct, but I think you miss the fundamental of the merger. The EJ&E didn't "sell out." It was - and still is - owned by U.S. Steel Corp., which no longer wants to be in the railroad business and thought $300 million was a good payday for a railroad that really is an outer belt around Chicago and doesn't serve much O/D traffic. The funny thing about the CN/EJE deal is that they didn't have to go through all the agony they did. If CN had done a haulage agreement, it never would have had to go to the STB or go through the environmental impact statement. Then, when the volume got up to an appropriate level, CN could have bought it. Then, because the traffic already would have been higher, there would be no environmental impact and no EIS to be done. On a purely transportation basis, there are no anti-competitive issues and the STB would have approved it as a minor transaction within a couple of months. I think CN went the way it did because it didn't want to be putting $100 million into someone else's railroad. Sort of like NS and KCS creating a new 50-50 subsidiary for the KCS Meridian Speedway. NS got ownership in exchange for its capital. In God we trust; all others pay cash.
Posted by michael willis on 1/11/2009 9:32:44 PM
MORE RAILWAY MAGAZINES ARE SORELY NEEDED! - to entice aspiring young civil, construction, structural, mechanical & electrical engineers, industrial and vehicle designers, planners, architects, business and management majors available today in bookstore chains such as Barnes & Noble and Borders. this colossal feat could increase public interest in the railroad industry. Rail-fan editions are great reading but cater to the already loyal middle-age railroader. Community college level rail courses and publications could appeal to locomotive engineer training, railyard positions, traffic control and logistics. Four year colleges could help to bring back the professional business standing that railways had before. US railways and public transport will soon take center stage in the new infrastructure bill. I did a rough count of what was available in the transportation sections of the magazines area of a Barnes & Noble store in Rochester Hills Michigan: automotive-more than 200 editions, trucking & 4x4 offroading-more than 100, atvs/snowmobiles-more than 30, motorcycles-more than 75, boating-more than 40, UFO magazines-take a guess- there were even more knitting magazines than rail editions! RAILWAYS-less than 10! 4 were from the UK and 6 from the US. Thomas The Tank Engine has his very own section with the wooden railway set and dozens of books. There has to be something to fill the void in rail publications and generate real general public interest between Thomas The Tank Engine and the TGV.
Posted by Larry Kaufman on 1/12/2009 11:39:05 AM
Michael Willis raises some interesting points. If publishing more magazines specializing in railroads were the answer, I suspect there would have been many more such publications by now. The fact is that the railroads managed to virtually withdraw from public view and those schools that had strong engineering programs closed most of them because of a lack of student interest. It is the railroads' obligation to make themselves known to potential employees, and to make railroad careers attractive to those they would like to bring into the industry. Young people today have different standards and concepts that did prior generations. Being on call 24/7, for example, accepting a culture of intimidation, being supervised by people with little comprehension of how to be a good supervisor. These are things today's young people will not accept. No, Barnes & Noble and Borders will not create a pool of potential rail employees. They carry the mix of publications that they do because those are the ones that sell and that have sufficient advertising support. Railroads do little advertising of their own (CSX and NS being notable exceptions), and rail equipment suppliers tend to restrict their advertising to professional publications like Progressive Railroading. How many suppliers do you see paying for space in Trains?
Posted by James Swidergal on 1/12/2009 12:05:05 PM
First,in responce to Mr Kaufman,I whole-heartedly agree,and thanks for the info (USS ownership issue),but what I was trying to render here was in relation to the story about how shortlines have the potential to advance their place in the railroad arena. The "J" had that all built in and still gave it up, that's a sell out. But you are right,the CN went about it the wrong way, the UP has been using that corridor for some time now, and it seems not to affect their bottom line. Perhaps,E.Hunter Harrison is a bit more greedier than James Young. Secondly, Mr Willis,it seems that your comment has nothing to do with shortlines or the Honda story, and I am in agreement with the fact that there really is a lack of railroading journals and periodicals,etc. But it's more likely than not for the fact that printing such hard copy, is being replaced (just like the daily newspapers,ie Most recent event Chgo Tribune) not because of lack of content but because of the lack of interest (in Railroading) and cost prohiobitive aspect of start up, and feature writers,and overhead,and all the other costs of doing business. Thomas the tank engine took a fullfledge marketing scheme to bring it into the lives of little children, and is not the real railroad with it's complex issues. And speaking of complex issues,I wonder why such a great deal of time and money was expended by the FRA and the Carriers' on that report published in Oct 2008 at the FRA R&D website on The Problems with recruiting and retaining employees. I'm available and I'll work for as many years as they'd let me, where do I sign up.
Posted by Larry Kaufman on 1/12/2009 2:58:54 PM
James, I also agree that the short lines have a most important place in the railroad firmament. The EJ&E, however, is a different story. It just doesn't have much origin or destination traffic, and there are few rewards today for being what used to be called a bridge carrier. Only those railroads that can control either the origin or termination can deal with the Class 1s and have any real chance for survival. UP uses the J only for coal and probably doesn't have a need to bypass Chicago (It already has Rochelle for its outer intermodal volume.) CN, on the other hand, has a rather clear need and strategy to be a competitor for international intermodal into the Southeast. That involves entering North America at Prince Rupert, as much as two sailing days closer to Asia than LA/LB or Seattle, and then getting through/around Chicago quickly by staying out of the congestion in close-in Chicago. Thus, the J has a value to CN that it doesn't have for UP. It's not a matter of greed by Harrison or less greed by Young. It's pure economics. The J fits CN's strategy and UP doesn't need it.
Posted by Paul Matchett on 1/13/2009 12:39:32 PM
I help put that track in, glad to see a train using it finaly, that CWR was a pain to put in!!
Posted by Richard Frick on 1/13/2009 9:13:31 PM
Railroads are vital to the Automobile Industry. Large parcels of land adjacent to rail lines are of paramount importance to provide service for the Manufacturing Plants. Whether they are Short Lines or Main Lines are not within the thought processes of the Parties that perform the search for property, utilities, labor force and incentives to locate a Manufacturing Plant. The CSX made a decision concerning the line that runs from Cincinatti to Indianapolis and felt that it was not cost effective. Enter the CIND and Rail America with the foresight to seek prospective customers and their desire to work with the State of Indiana to locate industry along their line. They also showed strong forsight in dealing with Honda to develop the Rail Facility to meet their Honda's rail needs. Honda came out the winner with the ability to utilize the CIND and Contract with the interchange agreements to achieve flexibility for their shipping needs. Honda and CIND/Rail America and the State of Indiana are all winners. What could be better?
