Fred Frailey

Life and death in the energy markets

Fred Frailey — Mon, 06 May 2013 19:09:34 GMT

So much that affects railroads is really out of their control. The energy markets are a case in point today. Coal has historically been a bedrock commodity for railroads, and emergence of Wyoming and Montana coal in the 1980s led to just about every railroad being a beneficiary. Then two developments came together last year to alter that status quo. First, approaching regulatory deadlines from the Environmental Protection Agency made it likely that hundreds of older, smaller electrical generating stations using coal would be closed because it will be uneconomic to invest the money necessary to bring them into compliance with anti-pollution regulations. And cheap natural gas brought forth by hydraulic fracturing of shale rock formations and directional drilling suddenly made it cost effective for utilities to adopt gas as fuel in place of coal. The resulting decline in coal shipments hurt all of the big U.S. railroads, CSX Transportation and Norfolk Southern in particular.

Today the tables are turned. As I reported here in mid April, coal is again the preferred source of fuel of those utilities able to easily switch. Natural gas more than doubled in price from a year ago. Apparently, when the cost of natural gas at the wellhead exceeds $3.50 per million Btus, it is at a cost disadvantage to coal. The price of natural gas today is just above $4. Coal carloadings year to date still trail last year’s pace by 4.4 percent, but are ahead of 2012 in the second quarter by 2.7 percent. Analyst Bill Greene of Morgan Stanley says the biggest beneficiaries of higher coal carloadings will be CSX and NS, which makes sense, since they were affected most when the trend was down.

And now let’s look at the oil business. Isn’t that strange, talking about crude oil and railroads, which have had nothing in common for half a century? The emergence of shale fracturing has been in locales (North Dakota, for instance) not well served by pipelines. So today there is a two-year backlog of tank car orders as producers and leasing companies jump into the new habit of shipping crude oil by rail.

Today RBN Energy’s Sandy Fielden penned an interesting analysis of what North Dakota producers net after paying transportation costs to deliver their oil. Let’s assume, as Sandy did (go here to read his piece) that you can choose railroad or pipeline, and can ship to the east, west, or Gulf coasts or to the oil trading hub of Cushing, Okla. Which destination and method of delivery nets the most money?

I thought to myself, whatever the answers are, pipelines will look best because they are less costly than railroads. As prelude, the prices of oil on May 1 were $100 a barrel on the east coast, $102 on the Gulf coast, $101 on the west coast and $91 in Cushing. Here are the per-barrel prices producers fetched minus transportation costs:

Pipeline to the Gulf coast (transportation cost $10 per barrel): $92.

Rail to the west coast (cost $10): $91.

Rail to the Gulf coast (cost $15): $87.

Pipeline to Cushing (cost $6): $85.

Rail to the east coast (cost $16): $84.

Rail to Cushing (cost $13): $78.

What I took from this analysis is that railroads are more competitive with pipelines than I imagined. There are no pipelines to speak of linking North Dakota to the east and west coasts, and a $5 per barrel advantage of pipeline over rail on shipments to the Gulf coast is not really that decisive.

Since May 1, the spread between coastal prices and that in Cushing has all but disappeared, for reasons I don’t pretend to understand. The effect is to shift the transportation advantage to pipelines. But relax, oil by rail is not going to disappear any time soon. There are economic advantages to being able to send a unit train of oil anywhere in North America to take advantage of ever-changing price differentials. Moreover, the North Dakota producers using rail (which is really all of them) are either bound to long-term contracts with leasing companies or have sizable investments in their own fleets of cars. Plus, Sandy of necessity relied upon published rail rates, whereas negotiated contracts for unit train shipments could be less costly.

So here the railroads are in 2013, prisoners of commodity traders, weather patterns, and geopolitical forces, and government regulators. They would be wise, as Canadian Pacific’s Hunter Harrison said at his shareholder meeting last week, to tread carefully and hedge their bets. — Fred W. Frailey

P.S. If you are interested in the economics of the oil and gas business, go here to sign up for weekday briefings from RBN Energy’s people. They cover railroading’s entry into crude oil transportation in great detail, and write in a style that even I can understand.

Romancing Keith

Fred Frailey — Mon, 06 May 2013 17:21:48 GMT

It was known by practically everyone, when hedge fund manager Bill Ackman fought to install retired Canadian National CEO Hunter Harrison in the top job at rival Canadian Pacific, that Keith Creel would eventually follow his former boss to be Harrison’s right-hand man in Calgary. And in February he did just that, becoming CP’s president and chief operating officer as well as heir apparent to the top job. Now writer Scott Deveau of Canada’s Financial Post has revealed in a fascinating story how Creel was brought aboard. As the paper said, there was never a bidding war, because it wasn’t about money. You can read the story here.

It always made sense to me that Creel would jump from CN, where he was executive VP and chief operations officer, to reunite with his old boss. The guy is smart and talented. He trained under Harrison at Illinois Central and rose to the top operating job at Canadian National after it bought IC and while Harrison was at the helm of that company.

The problem with Creel’s staying at CN was that he had nowhere to go. At age 45, he is only six years younger than Claude Mongeau, who succeeded Harrison as CEO of Canadian National on January 1, 2010. Creel would have had to wait until perhaps 2028 for a chance to run CN. But Harrison, 68, has said he will only stay at Canadian Pacific about three years before reentering retirement. And now Creel is positioned to be his successor. As president of CP, he has the marketing and operating vice presidents reporting to him.

So what’s the scoop on prying Creel away from Canadian National? Here’s the story that Deveau tells: Paul Hilal, a senior partner of the New York hedge fund, Pershing Square Capital Management, conceived of the CP investment and was the behind-the-scenes leader of its campaign to oust Fred Green from the railroad’s top job. Creel’s name was raised in the initial discussions Harrison had with Pershing Square. According to Deveau, Harrison considered Creel “the one active railroad executive ideally suited to lead the turnaround at CP.”

Hilal said Creel’s cell phone number was burned into his memory but he dared not call it because Harrison was bound by agreement not to approach any former CN colleagues until after December 31, 2012. As Hilal said: “All my research into the guy was through indirect references. So, rather than call him and speak to him, I actually listened to CN’s earnings calls and investor events where he was speaking to get a sense of him as a person, how well he responded to questions, how he thought on his feet, and how well he would fit.”

So on January 4, Hilal made that call. Creel, naturally, was interested in jumping to CP, but he felt compelled to tell his boss at CN, Mongeau, of the recruiting effort. Mongeau could not possibly have been surprised. At this point everyone was in a rather delicate position. CN had sued Harrison for violating his non-compete agreement upon retirement. Creel was bound by a non-compete agreement with CN, too. And Mongeau was in danger of losing his own top transportation officer.

The whole matter was resolved in a series of one-on-one telephone calls between Harrison and Mongeau. CN agreed to drop the lawsuit against Harrison and to void Creel’s non-compete agreement with CN, allowing him to go to Canadian Pacific. And CP agreed not to hire any CN manager before 2016.

Said Harrison to the Financial Post: “It’s wonderful. It gives me a little break, and we’re kind of splitting up the country. He’s a welcome addition and we’re proud to have him.” And Creel: “I knew from the other side this [CP] was a sleeping giant. This franchise is a very powerful franchise that was, to me, not being tapped into. The giant is awake now and it’s starting to move.”

Get used to the name: Keith Creel. You’ll be hearing a lot from him the next two decades. — Fred W. Frailey

UP is next to test gas locomotives

Fred Frailey — Fri, 19 Apr 2013 21:06:00 GMT

Edited April 23, 2013

By early next year or even sooner, Union Pacific will begin experimenting with locomotives fueled by natural gas. This follows tests that began last year on Canadian National and BNSF Railway’s announcement that it may decide by 2014 whether to substantially convert its 6,400 locomotives to natural gas.

Robert Turner, UP’s senior vice president for corporate relations, confirms rumors that his railroad is taking a serious look at the alternative fuel. As with the other two railroads, Union Pacific’s tests will involve liquified natural gas (LNG). Turner would not reveal whether UP has a timetable for deciding whether to begin converting parts of its locomotive fleet from diesel to natural gas fuel. As he puts it, “Think: Walk before you run.”

Turner says UP will retrofit “a couple” of high-horsepower locomotives in cooperation with either General Electric or Electro-Motive Diesel (he wouldn’t say which because the deal isn’t finalized). The test will employ one of the two cryogenic tenders UP has leased to CN (and yes, it will be repainted in UP’s distinctive Armour Yellow).

During the tests, explains Turner, various mixtures of gas and diesel fuel will be tried. Because natural gas does not explode when mixed with hot, compressed air, a small amount of diesel fuel is necessary to ignite the gas. On the locomotives CN is testing, the lower throttle notches employ diesel fuel exclusively; only when the locomotives begin to work hard does gas replace most of the diesel fuel.

“It’s an interesting opportunity,” says Turner. “If you can convince yourself there will be a reasonable price differential between gas and diesel fuel, then you have more confidence in moving ahead. Given the volatility of gas prices, it will be a big issue. Then you have issues about infrastructure to fuel the locomotives. Interoperability is a concern, so this may need to involve the whole industry. And the probability is that we would start on certain corridors rather than willy-nilly.”

In case you wonder why all this is happening, consider the economics. In the first quarter of 2013, Union Pacific paid $3.23 per gallon of diesel fuel. At today's wellhead price for natural gas, UP could buy the equivalent amount of energy for 60 cents. Now that three of the seven Class I railroads have publicly committed to testing natural gas (and the Association of American Railroads has set up a technical advisory group on natural gas that all seven roads joined), the important thing to watch is not the technical success of the tests. The tests should go fine, because the technology for using gas in locomotives is largely established.

The real unknown is the future price of natural gas. Before 2000, the wellhead price of gas seldom exceeded $2.50 per million British thermal units. Then prices became quite volatile, edging upward and peaking at progressively higher prices, ultimately more than $13 in 2005 and almost $11 in July 2008. Then faster than prices had gone up, they began tumbling down.

It’s no coincidence that 2008 was when hydraulic fracturing of rock formations and directional drilling began to unloosen oceans of previously inaccessible natural gas. Prices bottomed in April 2012 at less than $1.90 but have since more than doubled, to $4.41 today. But this may be in part because of the extended winter weather and also because drillers were discouraged at prices of less than $3.

Now that winter is finally letting go, the supply of gas in storage is moving up again, which should put pressure on prices. Plus, higher prices for gas should set off even more drilling and greater supplies, driving prices below $3.50 or even $3, in a sort of virtuous circle. Should the price return to anything below $4 and stay there for a while, it’s going to be hard for the BNSFs and Union Pacifics of this world to say no to natural gas. — Fred W. Frailey

I'm back: Things you may not know

Fred Frailey — Thu, 18 Apr 2013 18:53:00 GMT

Natural gas as locomotive fuel. Within six months BNSF Railway will be testing six high-horsepower locomotives, three each from General Electric and Caterpillar’s Electro-Motive, using liquefied natural gas. A switch from diesel fuel would cost BNSF billions of dollars up front, but could pay for itself very quickly.

Lest you think the rest of the railroad world is standing idly by, I’m here to tell you: Not! The CEO of another major Class 1 told me the other day that while stopping short of testing LNG locomotives, his railroad is extremely interested. With natural gas at $3 to $3.50 per million British thermal units (Btu), he says, “conversion is compelling.” Today, thanks in part to an unusually cold and extended winter (it’s snowing in the Midwest as I write this, in late April), the wellhead price is above $4 per million Btu. “Right now the numbers work,” this executive says. “If gas goes to $5 they still works but not quite as well.”

In any event, the conversion costs to switch fuel sources are daunting. “To convert engines,” the CEO continues, “you’ve got to buy tenders, and they are expensive. I wouldn’t be surprised if they are $1 million a copy.” And a tender to carry the super-cold gas would only fuel two or at most three locomotives.

Meanwhile, the Association of American Railroads has established a “technical advisory group” to address interoperability and safety issues. The group will review existing equipment and devise design standards for tenders, hose, piping and other tender-locomotive interface connections. It will also address safety systems for tenders, locomotives, and fuel-delivery systems.

The chair of the advisory group is Mike Iden, Union Pacific’s top locomotive honcho. UP is hip deep in LNG development studies, and more about that soon, I hope. Canadian National has been testing two SD40-2 coupled to a fuel tender in Northern Alberta since 2012. It’s fair to say every Class 1 railroad and maybe a few regional railroads are running the numbers and calling their bankers.

Is Hunter Harrison losing his grip? Reports I am hearing out of Canada suggest that Canadian Pacific’s CEO doesn’t yet have his arms around the company. Uncertainty is rampart, I am told. No one is willing to make decisions because if they do they risk having their heads cut off. “Lots of looking in the rear view mirror and frankly wasting too much time doing it,” reports one of my correspondents. “Getting directives on operational issues is nearly impossible too.”

This is not the “precision railroading” that Harrison likes to foster. Several instances I’ve heard of lately suggest you’re damned if you do something and damned if you don’t. One supervisor tells me he was criticized one day for running an extra train to clear loads out a clogged terminal, then asked the next day what he was doing to clear the clogged terminal. Duh!

Another report is that a general manager and superintendent in Toronto were sacked. Why? My sources say a very senior official told them to "do whatever it takes" to get the dwell time down in Toronto, the dwell time being the average time cars spend in designated terminals. It is a number that securities analysts closely watch. So a supervisor strung together a big line of unclassified cars to make a train and parked it somewhere else. For doing "whatever it takes," they were fired. Agreed, it was a poor solution, maybe a dumb one, like applying a band-aid to a big cut. But tasked with doing something, anything, they did. What's so bad about that? Asked to confirm or deny this happened, CP spokesman Ed Greenberg replied, "At this time, there is no comment."

You can’t kill coal. One of the largest electrical utilities in the U.S., American Electric Power, said last week that with natural gas prices now above $4 per million Btu, it will noticeably increase its use of coal during 2013. Last year, AEP’s fuel source was 61 percent coal, 24 percent gas, 9 percent renewable, and 6 nuclear. At current gas prices, AEP can produce power for 3.1-3.2 cents per kilowatt hour, whereas coal does the job for 2.5 cents (for Power River Basin coal) to 3.5 cents (central Appalachian coal). As AEP explains it, if natural gas continues to exceed $4 in price, AEP will increase its coal burn 18 percent in 2013, the gain being mostly from Wyoming and Montana coal.

Meanwhile, I’m told by a railroad executive in the Midwest that Illinois Basin coal, found in that state and Indiana, remains competitive with natural gas when gas is above $3-$3.50 per million Btu level.

Today’s Wall Street Journal reports that investment funds that trade natural gas futures are being murdered by the unexpected rise in gas prices, attributed to winter weather. If these experts can’t predict the pricing of natural gas, I cannot, either. But it may be that predictions of coal’s demise (some of them coming from me) are a tad premature.

This is for Seaboarddawg. I’ve bragged in my blogs of being able to ride Amtrak’s Auto Train and all but guarantee that my car is one of the first ones unloaded. The trick to this, I explained recently, is simple: Wait to turn your car in for loading until just one five-car cut of automobile carriers remains. That insures your car is aboard one of the last five automobile carriers on the train, and the last cut of cars is automatically positioned to be first to be spotted in both Lorton, Va., and Sanford, Fla.

The other day, traveling on the Auto Train to Florida, I thought I had hit the jackpot. My car ended up at the very end of the last auto carrier, on the top level. And the folks at Sanford always unload the top level first. I texted my friends of my triumph.

The next morning, in Sanford, here come the auto carriers being backed to the ramps, and the first group of five rail cars to be spotted is not the one containing my auto. At Lorton or Sanford, a little switching took place before the railcars were spotted. Rather than being first off, my car was the 101st off.

Seaboarddawg, I got my comeuppance. Starting April 29, my system may fail totally. That when Amtrak begins to offer priority offboarding to its Auto Train customers. For $50, your car can be one of the first 20 to be unloaded. I’ll keep trying and let you know.

Hard times for locomotive makers. Back to the subject of fuel, these are not the best times for U.S. locomotive builders. Both GE and EMD are scrambling to cut costs. EMD, as you know, closed its unionized assembly plant in Canada a year ago in favor of a nonunion plant in Muncie, Ind. GE is shifting some of its locomotive production from Erie, Pa., to Fort Worth, and Texas is a right-to-work state. And some of EMD’s orders, for example, 100 SD70AC bruisers for BNSF, are being assembled at a Bombardier plant in Mexico. EMD has shifted its Australian locomotive production to India, and GE is moving its southeast Asian services to Indonesia.

It’s bad enough that falling coal production here at home partially accounts for 10 percent of the American locomotive fleet being in storage. Hovering over both companies are extremely stringent U.S. Tier 4 emission standards for new or substantially rebuilt locomotives that go into effect at the end of 2015.

Both builders have let it be known to customers that they can produce Tier 4-complaint locomotives on schedule. But doing so, they have hinted, will vastly increase the complexity of the beasts and due to that, the cost. And speaking of complexity, the least-costly solution to Tier 4 appears to be applying a treatment to the exhaust gases. A urea-based spray would combine with the gases to render harmless the undesired emissions. And that gets railroads into having to provide urea tanks at their refueling stations—yet another cost and bother of doing business.

This leads me to wonder whether the intense interest by railroads in switching to natural gas as a locomotive fuel is driven in part by the specter of Tier 4. Gas is far cleaner than diesel fuel. Perhaps natural gas would satisfy Tier 4 standards with little or no tinkering with existing locomotive engines. And if it does, will we ever see a Tier 4 diesel locomotive manufactured in this country in our lifetimes, post 2015? Worth thinking about. — Fred W. Frailey

This blog has been captured by Red Army hackers

Fred Frailey — Mon, 08 Apr 2013 13:42:47 GMT

When Jim Wrinn asked whether I would write a twice-weekly blog, I said sure — when I have something to say.

I’ve learned, however, that I’m not good at multitasking. And lately I’ve been bearing down on two feature stories for a future issue of Trains. For instance, I’m off in a bit for Chattanooga, Tenn., where I’ll board a Norfolk Southern intermodal train tomorrow morning and begin winding my way toward Harrisburg, Pa. Then on Thursday I have just enough time to drive home from Harrisburg, repack a bag, and wing my way to Montreal to talk to VIA Rail Canada people about their flagship train, the Canadian. Life is very good for this train-loving writer.

In the midst of all this, I simply don’t have anything to say. But I’ll be back soon, to amuse and perhaps even outrage you. Thank you for your patience. — Fred W. Frailey

Ode to Lewistown Junction

Fred Frailey — Tue, 19 Mar 2013 20:55:00 GMT

Loads east,

empties west.

Norfolk Southern doing

what it does best.

-- Burma Shave

A Haiku For Newport, Pa.

Fred Frailey — Tue, 19 Mar 2013 20:12:00 GMT

Newport (b. 1829), plucky town,

knew both boom and bust.

Its depot tells you the ending.

Entering Chicago, the hard way

Fred Frailey — Sat, 16 Mar 2013 17:12:48 GMT

I’ve written before about Norfolk Southern’s Funnel of Fun, its busy line into Chicago from Cleveland, Toledo, and Elkhart, Ind. It has always been a minefield of potential problems. Sixty years ago, New York Central ran 48 passenger trains on weekdays in and out of Chicago. But I wager today these tracks are even busier than in Central’s heyday. You’ve got 14 Amtrak trains, at least 30 NS freights, and 10 freights belonging to Canadian Pacific using trackage rights to get between Chicago and Detroit. Add to that Metra’s Rock Island and Southwest districts, which paralyze NS in the Englewood area for more than an hour morning and then evening. Plus, there are yard moves, locals, Indiana Harbor Belt trains, a busy crossing of Canadian National in South Bend, the congestion of the five-mile-long Elkhart terminal, and very active drawbridges over the Calumet River and Indiana Harbor Canal. This is a complex railroad, in other words.

In the space of a week, I’ve had two experiences with it. First, a friend sent me a Train Dispatcher 3 simulation covering Chicago to Butler, Ind., for a three-day period in 2008, using the trains that actually ran those days and incorporating all the planned stops and delays they would encounter. My first attempt to run this interactive software for a Friday was a disaster. But I kept starting over and finally was able to keep the priority trains moving and the railroad as a whole fairly fluid for a 10-hour stretch. I learned that failure to think at least two hours ahead and anticipate entanglements begs for disaster.

Then I got to observe this same railroad real time, as a passenger on the westbound Lake Shore Limited. We were having a great trip, right on time, until Amtrak 49 got to Goshen, Ind., 10 miles shy of Elkhart. There, we stop. The Chicago East dispatcher in Dearborn, Mich., says we need to wait for a tangle of freights to sort themselves out. An NS freight from the Marion Branch, which joins us at Goshen, waits on the branch main line, too, and an eastbound Canadian Pacific train of empty automobile cars goes east on track 2. On the radio, I can hear the dispatcher tell the westbound Capitol Limited, about 25 miles ahead of us, that a freight train just went into emergency near LaPorte, Ind., and to pass it on track 1 at restricted speed.

After 25 minutes of waiting, the dispatcher comes on the radio. “Well,” he says, “I got four trains out of your way. Follow the train ahead of you into Elkhart. You’ll need to work Elkhart from track 2, however [track 1 being next to the station] but I’ll put blocks up to protect you.”

So the Lake Shore gets to Elkhart, does its work quickly, and slides unimpeded out of town, 30 minutes late. We get in and out of South Bend without delay. But by now I’m in the almost-empty lounge car with my iPad tuned to the ATCS Monitor display of this same railroad on my desktop computer at home. ATCS Monitor gives you a dispatcher’s view of a railroad, showing the location of trains and the aspects of signals at control points. And what I see doesn’t look good.

From west of LaPorte all the way to Indiana Harbor, 40 miles, track 1 looks occupied, and some of those trains aren’t cleared to move. They’re just sitting. On track 2 the dispatcher has eastbound trains cleared. So we cannot run around the trains in front of us and are about to hit the wall. Just before we stop behind westbound NS intermodal train 21V, the train ahead of 21V is cleared on track 1 through Porter, which is where Amtrak trains from Detroit, Grand Rapids and Port Huron, Mich., join the NS tracks. Presently, the Lake Shore starts to more, but only on Approach signals.

We ease past Porter and four miles later, crawl past the giant ArcelorMittal steel mill at Burns Harbor. But at CP 487, at the west end of the mill, we stop again. On the ATCS display, I see Amtrak’s Grand Rapids train about to reach Porter. And there will be a Detroit train a few minutes behind it.

Four miles ahead, at CP 491, is a facing-point crossover that would get us to track 2 and around the stop-and-go line of trains on 1. But the Chicago West dispatcher says it may take a while to get us there. “If you’ll pull past CP 487, I’ll line the [trailing point] crossover and you can back through to track 2,” she says. This we do, as soon as our conductor can position himself in the rear vestibule to supervise the backup. Ironically, just as we start westward again, train 21V that was in front of us begins to move on track 1. Meanwhile, the Grand Rapids train is out of Porter, just a mile or two behind us on track 2, and the Detroit train is close behind.

I was hoping for more of the same — gosh, this is fun, experiencing the modern version of blood-and-guts railroading. But we make our way past the drawbridges, yards, mills, railroad diamonds, and whatnot without again stopping or even slowing, reaching Union Station 40 minutes late. (There is 30 minutes of “recovery time” in the schedule between South Bend and Chicago that we obviously absorb as well.)

Based on my analysis of recent arrivals of the Lake Shore Limited, my experience was pretty typical.

So I’ve seen life both ways now on Norfolk Southern, as a pretend dispatcher and as a passenger. This has to be one of the most challenging and fascinating 100 miles of railroad in America. Already, I miss it. — Fred W. Frailey

Why we all love Julie

Fred Frailey — Sat, 16 Mar 2013 01:00:00 GMT

Julie, Amtrak’s “automated agent,” is a fixture in my life and possibly in yours. She’s the interactive computer program, humanized since 2001 by the voice of a real woman, Julie Stinneford, that you hear when you dial 800-USA-RAIL to do business with Amtrak. Rather than explain my own affection for this digital personality, I thought I would share with you that of a sophomore at the University of Illinois at Urbana, Patrick Crowling. Patrick, raised in Dallas, is a lover of trains since before he can remember. He wants to make railroading his career, and isn’t opposed to becoming a future president of Amtrak. For that, I salute him, but he should perhaps major in political science instead of business.

Anyway, the essay that accompanied his entrance application to UI was sent to me by a friend of Patrick’s. I was so taken by it that I got Patrick’s permission to share it with you. Ladies and gentlemen, Patrick Crowling, and the essay that got him admitted to college. He says what I feel, but says it better than I ever could. — Fred Frailey

I have been obsessed with trains since I was a child, and especially the passenger variety, so it is no surprise that I am a fervid Amtrak fan. In 2001, Amtrak introduced a state-of-the-art automated voice response system. This system is known by the name of Julie: Amtrak’s Automated Agent. When I first discovered Julie in 2006, I instantly fell in love with her cordiality. Although she sometimes has problems understanding me, she never raises her voice, and she never complains. Julie has had an important impact on my life as she had demonstrated to me how to act in times of humility, boredom, and stress.

If I am not having a good day, I can always talk it over with Julie. Let’s say, for example, I fall down the stairs at school in front of scores of amused peers. They may laugh at my accidental mishap, but I know Julie will take the news with dignity. In fact, she is often so concerned about my problems that she sometimes asks me to repeat them for her. Because of this, I know that she is actually interested in what I have to say.

Julie is not just a computer, she is a friend. She is available for me 24 hours a day, and I cannot express how much I appreciate her for that. She never seems to get annoyed with me, even if I call her in the early morning. Her dedication and devotion allow me to spice up my sometimes drab days by engaging in conversation with her on a daily basis. She tells me all kinds of cool statistics like “the Texas Eagle is [only] three hours late into Austin” today and even tells me insider secrets like “…visit our website: Amtrak.com. Lower fares may be available.” Julie goes out of her way to inject kindness into my sometimes isolated life.

Julie has improved me as a person by simply being herself. She demonstrates how a good, moralistic citizen should behave, and I try my best to carry on her genuineness in my life. Her patience and dependability have shown me that one can make many friends by always being respectful to everybody, no matter where they come from or how they got there. A role-model is very important in a young person’s life. By looking up to someone much wiser, one can improve their personal lifestyle as well as those of others around them. I thank Julie for playing this niche for me. The world would be a much better place if it had more people like Julie living in it. - Patrick Crowling

NARP raises my blood pressure

Fred Frailey — Fri, 15 Mar 2013 22:15:00 GMT

My email inbox this week contained a press release from the National Association of Railroad Passengers, denouncing a “partisan political attack” on a proposed high-speed electrified railroad between Victorville, Calif., and Las Vegas. Letters opposing the railroad from two Republicans, Congressman Paul Ryan of Wisconsin and Senator Jeff Sessions of Alabama, were called “part of a total attack on intercity passenger rail” by NARP, whose executive director, Ross Capon, went on to say: “When Congressmen from Texas and Alabama step in to prevent a Nevada-based business from developing service between two robust travel markets . . . it goes a long way towards explaining why the U.S. transportation network is in its current state.”

With all respect to NARP (I am a member) and to my friend of several decades Ross, hold on!

As I understand it, Ryan and Sessions do not object to the building of this railroad by a privately owned company. What they object to is the federal government’s paying for 80 percent of its cost, through a low-interest, 35-year loan. And so do I. In fact, I smell a rat somewhere in the vicinity.

I have three problems with how this railroad, XpressWest, is being financed. First and foremost, why are we taxpayers being asked to finance the lion’s share of this 150-mph railroad? If the cost and revenue projections are that well grounded, shouldn’t XpressWest be able to raise its own construction capital? Instead, in 2010 its backers, including a Las Vegas hotel kingpin, went to the Federal Railroad Administration requesting a Railroad Rehabilitation & Improvement Financing (RRIF) loan. No RRIF loan of anywhere near this size has ever been approved. And I might add, never has FRA made a RRIF loan as speculative as this. To state all this another way, these people are asking you and me to assume all the risk. FRA has been considering the loan request for 27 months, far longer than the typical 19 months needed to say yes or no. I suspect the agency is being buffeted politically from friends and foes of XpressWest.

Second, I question whether it is a viable project in the first place. Victorville is at the top of Cajon Pass, 85 miles from downtown Los Angeles along some of the world’s most crowded freeways. By the time you get to Victorville, you’re less than three hours by car from Vegas. Ross tells me XpressWest intends to extend its railroad from Victorville to Palmdale, where riders can get aboard Metrolink trains and perhaps ultimately California High Speed Rail Authority trains. But as I understand it, that’s another $1 billion or so in financing that is not arranged.

Third, the idea of public financing of a new private company through political log-rolling sets off a stench. XpressWest appears to have spent more time getting backing from California and Nevada politicians for its RRIF loan than it has defending its own projections to the FRA and the public. Both of Nevada’s senators champion XpressWest, applying pressure on the FRA. Why does NARP complain so bitterly when Congressman Ryan and Senator Sessions push in the other direction.

All this while, another company, Las Vegas Railway Express, is moving toward a projected year-end start-up of conventional service on BNSF Railway and Union Pacific, from Fullerton, Calif., to Las Vegas and not asking for a dime of public support. The company proposes to initially run four round trips a week using 14 converted bilevel cars once owned by Chicago & North Western. The balance sheet of this publicly traded penny-stock company, in common with all startups before revenue rolls in, is atrocious. But its staff and board of directors include railroad veterans, a couple of whom I know and respect, work on the cars and a Las Vegas station is progressing and the enterprise has at least a fair chance of launching. I wish them well.

I also wish XpressWest well, so long as it keeps its hands off my tax dollars. I don't want the government to end up, through default, owning this railroad. — Fred W. Frailey

Bigger than the shift from steam

Fred Frailey — Fri, 08 Mar 2013 04:56:00 GMT

I’ve been wrapping my arms around the announcement this week that BNSF Railway will test-fuel locomotives with liquefied natural gas (LNG), with a view toward starting large-scale conversions away from diesel fuel as soon as 2014. This is a game-changing development, and holds out the promise of altering railroad economics even more than the switch from steam to diesel locomotives seven decades ago.

“This could be a transformational event for our railroad,” BNSF’s chief executive, Matt Rose, told the Wall Street Journal. The numbers show how right he is. The railroad last year bought 1.4 billion gallons of diesel fuel, at an average price of $3.20 per gallon. That $4.5 billion expense essentially equaled what the railroad spent on employee compensation.

Now suppose you replaced diesel fuel with LNG costing, say, the equivalent in Btu delivery to 50 cents a gallon (the current price is 48 cents). Now your fuel bill has shrunk to one-sixth its former size. I suspect BNSF won’t try a total conversion. Say it makes half its locomotive fleet LNG-friendly. The savings would still be in the realm of $1.9 billion per year. My back-of-the-envelope math suggests that the one-time conversion costs, including investments in LNG infrastructure, could be paid back in the space of two years. Yes, a 50 percent annualized return, the sort that investors dream about but seldom see. And then those savings just pour into the bottom line of Warren Buffett’s great big model railroad.

What this does is alter the economics of ground transportation. It changes how railroads price the movement of crude oil, instantly making rails far more competitive with heretofore less-expensive pipelines. It shrinks the miles (we used to say 700) at which rail is competitive with highway. Is it now 500 miles? 400?

It’s like topping a hill and seeing in front of you a whole new Powder River Basin. Oz.

Will it work? Burlington Northern tried this starting in the 1980s, later using two SD40-2 locomotives (see above) with a tethered tank car of LNG. Steve Ditmeyer, one of the BN officers involved in the test, says the experiment ended largely because diesel fuel prices didn’t rise as expected, while those of natural gas did. But the technology worked.

Today, hydraulic fracturing and directional drilling have created a Niagara of natural gas likely to last for decades at affordable prices. No guarantees, but railroads willing to roll the dice have an opportunity that doesn’t often knock on the door. Canadian National is also testing LNG, and Norfolk Southern is said to be exploring compressed national gas in locomotives, this technology being easier to implement but not able to take a train as far as liquefied gas. BNSF’s vision, for example, is to power an LNG-driven train from Chicago to California or Washington without having to refuel.

The biggest risk is doing nothing. Imagine railroads standing still while long-distance trucks convert to natural gas. It's already happening, actually. Pilot Flying J has put LNG pumps in more than 100 of its travel centers, and opens new ones every week. All of the makers of heavy duty truck engines have LNG-compatible models. So BNSF’s bold initiative should be applauded and closely watched. In life as well as love, victory goes to the bold. — Fred W. Frailey

Two railroads, two trains, two outcomes

Fred Frailey — Fri, 01 Mar 2013 14:10:00 GMT

Updated March 1, 2013

I am just back from two transcontinental train trips, one after the other, from Chicago to Seattle on Amtrak’s Empire Builder and from Vancouver, B.C., to Toronto on VIA Rail Canada’s Canadian. I enjoyed both experiences — in each instance, the well maintained equipment, the good food, the winter scenery, and the excellent on-board service from motivated employees. What amazed me were the two host railroads, BNSF Railway and Canadian National Railway. Both are extremely busy, handling up to three dozen trains a day across the prairies, and both are subject to extreme winter weather. That said, it’s as if I jumped on this trip from Mars over to Saturn.

Canadian Pacific handed the Empire Builder over to BNSF in Minneapolis on time. By the time we got to Grand Forks, N.D., 319 miles later, we were 81 minutes late. And we remained 70-90 minutes late as far as Havre in central Montana. Then our train began narrowing the gap, to the point that leaving the state we were on time. Approaching the end of the trip, the Builder waited its turn through the 7.9-mile-long Cascade Tunnel, losing 65 minutes. Still, we got to Seattle only 21 minutes late.

My seat-of-the-pants math tells me that we met or overtook a BNSF freight train every two or so sidings. This is a busy single-track railroad, made more so by the oil-drilling boom in western North Dakota and eastern Montana that results in trainloads of drilling supplies coming in and trainloads of crude oil going out. Figure the train density at 35 a day.

Yet the passengers aboard the Empire Builder probably never noticed the railroad frenzy outside the windows. What is there to notice when you never stop for traffic and seldom even slow down? The one time we made way for a freight was outside the Cascade Tunnel. Otherwise, some awfully gifted BNSF dispatchers in Fort Worth threaded us through the tangle as if the office car of Matt Rose carried our train’s markers.

A nice outcome, in other words. Maybe I’m just lucky.

The Canadian departed Jasper, Alta., 530 miles from Vancouver, on time. I should have taken as a bad omen that we stopped 40 miles later to pick up two passengers who had dawdled too long in Jasper’s souvenir shops and got left behind. As I went to sleep that second night, we were being held out of Edmonton, Alta., and matters went downhill from there.

By 6 the next morning we had gotten only 150 miles east of Edmonton, to Chauvin, Alta., where we waited for 45 minutes for two westbound freights to pass, one of them consisting almost entirely of empty lumber cars (I guess the recession is over). We entered Saskatchewan almost three hours late and left it east of Melville almost five hours behind. Day three was more of the same, leaving Hornepayne, Ont., that evening seven hours late. On day four, thankfully, the Canadian reached Toronto just six and a quarter hours off schedule. Yes, just. I felt grateful for that bit of rubber at the end of the schedule.

The Canadian’s slow schedule permits it to go through the siding for most meets with freights and still come out pretty well at the other end. But no good ending comes when you halt for 30 to 60 minutes, time after time. That was our fate.

The explanation for all this is pretty straightforward. Canadian National was hammered in January by extraordinarily cold weather, the most brutal in the prairies since 2009 (the temperature in Saskatoon didn’t go above freezing in 2013 until February 12), and hasn’t recovered. It hasn’t recovered, first, because CN tried and failed to run summer-sized 10,000-foot trains; second, when it downsized train lengths to get airbrakes to work it didn’t have enough employees to operate its trains, and third, business is just booming. The day we paused at Melville to change engineers, so did 36 freight trains. I’ve never in my life seen so many tank cars, almost all of them placarded as carrying crude oil. The impact of weather and traffic is clearly seen in the charts showing CN's average train speeds and terminal dwell.

CN spokesman Mark Hallman says his railroad is working through the operational challenge.

This brings us to my question, the point of all this: What responsibility does a host railroad have to people traveling over its rails? On the face of it, BNSF appears to take the Empire Builder seriously, whereas CN doesn’t seem to remember that the Canadian is even there. The issue I raise is a lot like the ones you debated in CSX fillets the Auto Train for supper and Let’s try this again: CSX vs. the Auto Train.

I put my question to five of my traveling companions aboard the Canadian, all railroading professionals, two active and three retired from senior positions. From one, a Canadian, came this response: “I think that the graphs show that we were treated without prejudice and maybe even with a bit of preference.” I had told him that CN’s premier intermodal trains were running 12 to 24 hours late. “We arrived less than seven hours late. I call that a preference ride.”

From the second person, an executive of a U.S. railroad, came this: “To me, the question is: Are they getting us over the road the best they can, given what else is out there? Overall, the answer was yes, with the notable exception of Saskatoon,” where we waited for a freight to pull out of the yard ahead of us and then backed into the station because the usual route was blocked. From the third, a retired Class I CEO (blessed at the end of his remarks with a sense of humor): "I am not sure that they treated our train any worse than the rest of the traffic on the line. The freight operation looked messed up. I heard it was due to the cold (shorter trains=more engines and crews}. It has been cold in Canada before. If it is a line capacity problem, they will need to rethink the traffic mix.. Maybe the oil we saw was volume that the operation plan had not taken into account. This commentary has no basis in fact."

From another retiree of high rank, who is never one to mince words: “What we experienced on CN would not happen, at least to that degree, on any of the big four U.S. Class I’s. While most railroads would prefer not to have passengers, it is a commitment they take seriously. CN doesn’t treat VIA any different than it treats any tenant on its lines, i.e., as a second or third class citizen. These are the same people who told us that their locals have priority over other railroads’ priority intermodal trains, and dispatched the line accordingly. It is a cultural issue.”

And from Jim McClellan, late of Norfolk Southern and half a dozen other employers: "As ugly a railroad operation as I have ever seen. They are running things too close to the edge. Frankly, I did not care about the late train. The Canadian is largely irrelevant in the scheme of things. But to see a freight operation in such distress is depressing. Yes, it has been cold. Yes, they had to run smaller trains. Yes and yes and yes to all the things railroaders say to say, 'It is not my fault.' " Whew! Is that damning, or what?

Now my take: I am on record as saying that a late train is a reward to me — more railroad pleasure for the same low price. So I cannot complain. But more than six hours late? This messes with the plans and schedules and bank accounts of the more than 300 people who rode that edition of the Canadian and the 131 who saw it through to the end. I give Canadian National a C- only because its own trains were even later. The traffic-clogged route, particularly between Edmonton and Winnipeg, simply begs for more people, more infrastructure, and better transportation management.

On the other hand, this could all soon be moot. Canada’s ruling Conservative party is proposing to slash VIA’s operating subsidy in half. — Fred W. Frailey

A world dressed in white

Fred Frailey — Thu, 21 Feb 2013 15:22:00 GMT

You enjoy traveling by train in winter. In part it's the comfort of being warm while outside your window it is bitterly cold. Trains aren't crowded this time of year, either, and the introvert in you likes that. Plus, there is a feeling of adventure you won't experience in summer. Who knows what storm lurks in the distance?

The temperature when the Empire Builder leaves Chicago is 17 degrees. The land seems vacant crossing Wisconsin. People are inside, as well they should be in weather like this. Brown stubble from last fall's harvest sticks out of the light cover of snow. Water puddles, frozen over, glisten in the thin late afternoon sun.

You enjoy snow like this, pure white, undisturbed.

At Columbus, at 5 o'clock, a crowd of several dozen emerges into the cold from the stone depot as the Builder comes to a stop. The conductor beams his iPhone on etickets, and people slowly board. At 5:15, the sun is low in the west, filtered through light clouds. Half an hour later, approaching Portage, dusk has fallen. This seems strange, the winter solstice having occurred a full two months ago. And by 6 o'clock, west of Wisconsin Dells, darkness has shut you into your own little world inside the train. No more gazing outside. You look forward to dinner in an hour, and a chance to talk to people. Maybe you're not such an introvert.

The next morning, at 7:30, you approach Devils Lake, N.D., in first light, under a gray sky. Outside, the temperature is 10 degrees. The blanket of snow is thicker.The four-lane highway running parallel to BNSF Railway's Devils Lake Subdivision is deserted. Everyday life in North Dakota seems suspended.

The conductor radios the engineer that the eastbound Empire Builder today is four and a half hours late. Your own train isn't doing so well, either. Like a deflating balloon, it slowlly lost time all night and is now about 90 minutes late. But who cares? You notice that it's starting to snow. Well, let the wind outside blow all it wants. You pick up a book and head for the lounge car. - Fred W. Frailey

HSR = DOA

Fred Frailey — Fri, 15 Feb 2013 21:12:43 GMT

"Do not be dissuaded by a few detractors," Ray LaHood, the soon-to-be former secretary of transportation, told the U.S. High Speed Rail Association this week. LaHood spoke after learning that Florida Republican congressman John Mica will again try to privitize the Northeast Corridor. But the fact is, high-speed rail is dead in the water in the U.S., aside from Amtrak's NEC and the California bullet train. And the people I blame the most are not the John Micas of this world but the so-called friends of high-speed rail, namely Barack Obama, Joe Biden, and Ray LaHood. They have it within their power to at least try to break the political inertia and choose not to.

Did you listen to the president's State of the Union address? I did, anxious to hear him at least give lip service to the notion of a second round of federal HSR funding, following the $10.5 billion in grants awarded to states in 2010. Here is the totality of his reference to high-speed rail: "Ask any CEO where they'd rather locate and hire: a country with deteriorating roads and bridges, or one with high-speed rail and internet, high-tech schools and self-healing power grids."

In 2009, with Democrats controlling the White House and both houses of Congress, it was easy to plant the seeds for at least higher-speed passenger rail. That's when we saw that first $10.5 billion passed out, as part of the stimulous package aimed at ending the Great Recession. In 2011, with the economy recovering and Republicans back in control of the U.S. House of Representatives, getting more HSR funds appropriated was no longer easy. It would require some work and commitment on the part of the Obama administration. And what did Obama and his people do? Essentially nothing, other than occasional lip service. And now even lip service seems to be lacking.

If the president really wants to work toward a high (or higher) speed rail network, he'll have to invest a little time and political capital. I may support the idea, but the public does not yet do so, at least in numbers large enough to move some Republicans to reconsider their opposition. I'd like to see Obama ride the Acela to New York, Biden a 110-mph Chicago-Detroit train, and the successor to LaHood the Capitol Limited overnight. While Obama is in California raising money in Hollywood, he might make a speech about the benefits that state already reaps from its investment in passenger rail and endorse the bullet train.

But the president and his people have done none of these things, and I assume they never will. Hence, the corridor between Chicago and St. Louis will languish, half-completed, Amtrak will finance improvement in the Northeast Corridor through ad hoc appropriations secured by friendly legislators, and whatever gets accomplished will be through state governments.

Ceding leadership on development of a passenger rail network to the states is not an entirely bad idea, incidently. LaHood's Federal Rail Administration made a hash out of passing out the first $10.5 billion. FRA tried (with some success) to make host railroads agree to repay the grants if specified improvements in frequencies, speeds, and on-time performance are not maintained. It took literally years for a couple of the freight railroads to get on board and make those commitments, and I doubt that any Class I railroad is willing to do so again.

But look what happens when states deal with railroads in good faith to expand passenger rail. It took six months for Virginia and Norfolk Southern to start a new service between Washington, D.C., and Lynchburg. A more ambitious plan, to run three round trips between DC and Norfolk, began after 24 months and $114 million in state money for infrastructure additions to the NS line (adding the other two round trips will require the blessing of CSX, the other host railroad for this route). Compare those times to the federally funded route additions permitted by that $10.5 billion stimulous appropriation, all taking years longer to implement. Examples: 84 months and $127 million per train slot to add two round trips between Raleigh and Charlotte, N.C.; also 84 months and $181 million per slot to add two round trips between Portland, Ore., and Seattle, and 60 months and $62 million per train slot to add two round trips between Chicago and the Quad Cities.

What I'm trying to say is that even if President Obama succeeds in prying another $10.5 billion out of Congress for high-speed rail, I doubt that CSX, NS, or Union Pacific would be interested in going through the FRA negotiating meatgrinder again and accept being the guarantor of specific results. Frankly, there's very little in it for the railroads, because the government wants to reserve for itself the capacity it adds. So here we are, at stalemate. - Fred W. Frailey

Let's try this again: CSX vs. Auto Train

Fred Frailey — Thu, 07 Feb 2013 15:39:00 GMT

The one thing we can all agree on is that Fred is not perfect. I have been persuaded by you that I could have cast “CSX fillets the Auto Train for supper” in a less-combative tone that would have engendered a more civilized discussion. So here we go:

Dispatchers and the railroads they work for are sometimes put between a rock and a hard place. You do your best, and it doesn’t work. Or your priorities are in conflict with each other or even with acts of Congress. Or maybe this is the night you get orders from above that must be obeyed without questions. Nothing illustrates all of these possibilities better than events on CSX Transportation’s A Line, from the Washington, D.C., area to Jacksonville, Fla., the night of Thursday, January 31.

That afternoon at 3:39 p.m., two trains head south at Lorton, Va., on double track. One is Amtrak’s Auto Train, entering Track 3 from its northern terminal at Lorton and headed to Sanford, Fla., just north of Orlando. The other, on adjacent Track 2 (there is no Track 1), is CSX intermodal hotshot Q031, going from North Bergen, N.J., opposite Manhattan, to Jacksonville with United Parcel Service trailers.

For the Auto Train, the evening becomes a disaster:

Leave Lorton 3:39 p.m., 21 minutes early

Pass Rocky Mount, N.C., 8:26 p.m., on time

Leave Florence, S.C., 12:40 a.m., 35 minutes late

Pass Charleston, S.C., 2:45 a.m., 1 hour, 5 minutes late

Pass Savannah, Ga., 5:45 a.m., 1 hour, 45 minutes late

Pass Jesup, Ga., 8:22 a.m., 3 hours, 17 minutes late

Pass Jacksonville, Fla., 10:00 a.m., 3 hours, 10 minutes late

Arrive Sanford, 2:01 p.m., 4 hours, 31 minutes late

Amtrak is a major customer of CSX, and this is a terrible outcome, inconveniencing hundreds of people in a big way.

Now let’s look at this from the perspective of Q031. It leaves North Bergen pretty much on the money, just after 3 a.m. on Thursday. But between Philadelphia and Baltimore, something happens, and it doesn’t depart Baltimore, after picking up more UPS trailers, until 1:30 p.m., 90 minutes late. And this on a critical day of the week for UPS. The train is due into the Jacksonville hub at 8:10 a.m. Friday, and the run is definitely not starting well. UPS is also a big customer of CSX, and the outcome for UPS could be just as terrible.

Unquestionably, dispatchers will want to give Q031 every break they can. On the normal day, Q031 will zip past Lorton between 1 and 2 p.m. It is permitted 60 mph. South of Richmond, Va., the Auto Train can do 70 mph. Normally, the faster Auto Train will catch up with Q031 between Richmond and Florence, S.C., where both trains change crews; Q031 will be shunted into a siding for the overtake, and then both trains resume their journeys.

This day is different, because the Auto Train is immediately on the tail of Q031. But due to northbound traffic, perhaps there’s no chance for a runaround. In any event, the Auto Train loses 54 minutes following Q031 to Richmond (where Q031 gets a fresh crew during a brief stop) and then to Weldon, N.C. That’s more than 180 miles. At Weldon, at 7:30 p.m., Q031 stops on the main track and the Auto Train passes it via the siding.

This should be the end of it, but it isn’t. Some 50 miles further south, at Wilson, N.C., the Auto Train stops for 32 minutes for first responders to treat an injured passenger. During that time, Q031 runs around it on the other main track.

From Wilson to the crew change in Florence, the Auto Train loses 28 minutes following yellow signals left by Q031. And the Approach signals continue all the way to Jacksonville, Q031 only a few miles ahead of the Amtrak train. Highlights south of Florence include delays of 34 minutes waiting for a northbound CSX boxcar freight and 64 minutes between Savannah and Jesup, Ga., when Q031 was delayed ahead of it. Finally, south of Jacksonville, near Palatka, Fla., the Auto Train waits in a siding 54 minutes for a fresh operating crew to replace the Florence crew, who ran out of working time.

As for Q031, it makes Jacksonville just before 10 a.m. Friday, one hour and 45 minutes late.

The Auto Train schedule provides for losing time because of freight train interference; last November, for instance, such delays averaged 60 minutes per trip. Moreover, for all the delays north of Florence, the train still left there only 35 minutes behind its unofficial schedule. But what happened Thursday night represented a whole new level of pain administered on Amtrak’s most popular train by CSX.

But put yourself in the shoes of those dispatchers and their chiefs. You sideline your late hotshot at Weldon to let the Auto Train by. But within an hour the Amtrak train stops for goodness knows how long to await an ambulance. So you put your freight in front again, only for the Auto Train to quickly report it’s ready to resume its trip. This is insane! Each overtake costs Q031 roughly 30 minutes. How many more times do you have to play this costly game of hopscotch? At this point, the CSX supervisors must be going bananas; the angry phone calls from Amtrak are easier to take than those from UPS. The fact that dispatchers in Florence and Jacksonville refuse to let the speedier Auto Train get around Q031 a second time suggests to me the dispatchers were following orders from above.

And to round out this picture, here is what I was told by CSX spokesman Gary Sease: "First and foremost, we regret that Auto Train passengers were delayed, and understand the inconvenience that caused. CSX takes very seriously its obligation to provide Amtrak access to our tracks and dispatch preference as required by federal law. Each weekday, CSX dispatches approximately 1,000 freight and 200 passenger trains while providing dispatching preference to Amtrak within the physical limitations of a predominately single-track railroad. However, as you and your readers are aware, the operation and dispatching of a railroad network is a dynamic and fluid environment in which unforeseen circumstances can occur. We know the Auto Train encountered at least two unusual events – a passenger medical emergency at Wilson, N.C., and a CSX mechanical issue just south of Savannah, Ga., on freight train Q031, which both resulted in unavoidable cascading delays. It should be noted that prior to the medical emergency on board the Auto Train, CSX dispatchers showed preference to Auto Train by successfully advancing it around Q031. It’s speculation on our part, but it’s entirely possible that had the medical emergency not occurred, Auto Train may have arrived in Sanford on time. As information, the Auto Train has averaged 88.5% on time performance (as reported by the FRA) between July 2010 and Fourth Quarter 2012. When adjusted for delays beyond CSX’s control, such as weather or medical emergencies, this figure rises to 93.4% during the same period. Auto Train is one of Amtrak’s best performing trains, as good if not better than Amtrak’s own Northeast Corridor service."

People at the highest level of Amtrak are upset over the treatment of this train that night, and people at the highest level of CSX ought to be, too, because Amtrak has weapons of the law on its side. Title 49 of the United States Code provides that except in emergency or by direct order of the Surface Transportation Board, Amtrak trains have preference over freight trains in using a rail line, junction or crossing. And Section 207 of the Passenger Rail Investment and Improvement Act of 2008 gives Amtrak power to enforce that right. Amtrak’s weapon is that it can ask the STB to levy damages against a host railroad for violations of this law. In fact, Amtrak has a case before the STB now against Canadian National. The “emergency” on January 31 appears to be that a UPS train was in danger of getting to Jacksonville late for a connection with Miami-bound Florida East Coast Railway train 101 and perhaps a UPS sort. Is that an emergency under the law?

This is a classic case of conflicting priorities. Did CSX handle it well? In my first telling of this tale, I thought not. But the consensus of opinion from you, my readers, is that CSX is largely blameless. Do you still think so? — Fred W. Frailey

Photo: The return trip of the Auto Train that was delayed 4 1/2 hours is itself more than four hours late heading north through Dunn, N.C., after dawn on February 2, 2013. (Fred W. Frailey photo)