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It gets very complicated.  Many builders such as Toyota, Honda, and BMW are clearly building a substantial manufacturing base in the U.S., but that may or may not be good for railroads.  It might lose for the railroad the long-haul assembled vehicle business from a port -- or it might actually enhance the railroad's traffic as the plant seeks to distribute by rail throughout North America rather than a lot of import short-hauls by truck to dealer from seaports around the margin of the continent.  It might build an autoparts traffic from U.S. parts manufacturers, or a nice container business from a seaport to the plant, and which is more profitable, anyway?Often the "foreign" manufacturers have started out in North America only as assembly plants with very low U.S. content but later the North American content rises substantially.  Many "foreign" autos such as Toyota actually have a higher domestic parts content, up in the 80% range (counting domestic as both U.S. and Canadian) than many "U.S." products such as Chrysler (the U.S. manufacturers have substantial content from Canada and Mexico).  From an automaker's point-of-view empty backhauls of multilevels, steamship containers, and RoRo ships all come under the category "things to avoid," as does the risk of having all of the assembly and parts sourcing in one country and the market in another, due to currency volatility penalties and the risk of tariffs, labor unrest, political unrest, transportation cost volatility, etc.  The automakers that intend to compete in the long term are really not "domestic" or "foreign" but multinational in outlook and dispersal of assembly and sourcing.From a railroad's point of view it might make more money to long-haul foreign-made parts from Long Beach to Kentucky, than from northern Indiana to Atlanta.  On the other hand railroads understand that manufacturers, especially big ones like automakers, are in the business of trimming their transportation costs to zero.  Assembly plants in the Kentucky-Tennessee region are within one day's truck transportation to better than 50% (two thirds? I can't recall) of the U.S. population base, according to Ward's Automotive.  So at first blush while it might appear that a new Toyota plant in Kentucky hurts rail traffic on the output side it might actually be better than a Detroit plant on the input side, or, if it sources its parts locally it might hurt rail traffic, but meanwhile rail traffic increases for the raw materials that make the parts -- plastic pellets, steel, iron ore, coal, etc.Fundamentally I do not see how the financial woes of GM, Ford, and Chrysler are necessarily "bad" for North American railroads.  No one is talking liquidation of them yet, only liquidation of the obligations.  Regardless, even if the domestic manufacturers should dwindle much or most of the loss of U.S. auto production will be made up by the foreign makers building assembly plants and parts supply networks here.  That is because U.S. heavy manufacturing is vastly more competitive than many think.  The labor cost advantage that developing nations such as India and China have is not sufficient to overcome the cost disadvantages of transportation, engineering, support, and infrastructure for vast swaths of the manufacturing universe, and as their labor costs rise they become even less competitive.  U.S. heavy manufacturing is highly competive with its industrial-nation competitors -- ask Komatsu why they failed to unseat Caterpillar's global dominance of earthmoving equipment, CNH-Global why they haven't overturned John Deere, Airbus why BearStearns predicts Boeing will get 64% of the revenue for heavy jetliners, or any number of companies why GE eats their lunch.  I think the bottom was reached several years ago in the U.S. in terms of loss of output to low-labor cost nations, depending on which particular sector one happens to be in.  In heavy capital goods we appear to be gaining ground rapidly. I apologize that this wanders; auto traffic is very hard to parse.  Coal is vastly easier to understand.S. Hadid
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