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[quote]QUOTE: Originally posted by TomDiehl [quote]QUOTE: Originally posted by futuremodal "Cardwell said BNSF is more concerned with booking "long-haul" freight from the Midwest than short hauls of regional commodities. "They would get $200 to $300 a move for us and $1,000 to $1,500 to Chicago," he said." Hmmm, let's see. On a ton/mile basis, that comes to $1.00 to $1.50 per ton/mile for the shorthaul freight, while only $0.50 to $0.70 per ton/mile for the long haul. Since it is the 3PI and the ports who are doing all the legwork and gruntwork, if BNSF is getting the same relative car mileage utilization per year, they'd be making twice as much revenue on the shorthaul as the long haul. Again, this isn't carload freight with all the inherent switching and shunting costs, it's unit train operation. This idea that long haul is more profitable than short haul doesn't fly when terminal costs have been mitigated on the railroad's behalf. And the reason BNSF could make more on this shorthaul intermodal than the long haul intermodal is that they only have to compete with trucking rates on the shorthaul to Puget Sound, while on the long haul they are competing with other railroads. And yet, the only dedicated shorthaul service BNSF is offering right now in the PNW is the Ritzville grain shuttle to the lower Columbia River ports, which is having to compete with the lowest of the low barge rates, not high end truck rates. Talk about an extreme example of Ed "Ilk" B's tripping over a $1000 pile of money to pick up a dollar! [/quote] Funny how you can make $300 sound like more than $1500. That must be the new math. ALL industry, not just railroads, look at the bottom line, not a short term profit that you're looking at. Only so many trains will be able to run over that one section of track. So they should just terminate all that traffic from Chicago at the produce shippers doorstep and pick up theirs? More like tripping over $300 to pick up $1500. Must be all that "excess capacity" that exists in your imagination. [/quote] C'mon Tom, I know you are not THAT dense! You obviously must be in a constant state of facetiousness. Aside from the clerical error (wherein "ton/mile" should read just plain "mile", since corrected), there is nothing in that analysis that you cannot understand. The revenue per mile for the desired Washington state service ranges from $1.00 to $1.50, while the revenue per mile for intermodal to Chicago ranges from $0.50 to $0.70 on a net basis. If each cycle is getting constant utilization, the shorthaul would be getting from $40,000 to $60,000 per platform per year ($200 to $300 per container x 100 cycles per year x 2 slots per well), while the long haul is getting $30,000 to $45,000 per platform per year ($1000 to $1500 per container x 15 cycles per year x 2 slots per well). Now, if the Puget Sound to Chicago double stack was earning revenues both ways, that would make a difference. But it ain't. Most westbound double stacks to Puget Sound are running mostly empties, because as you know, we have a trade deficit with the Pacific Rim, and most of what we do export to the Pacific Rim is in bulk rather than ISO containers. The fact that some ag producers are willing to fill up those otherwise empties with revenue producing freight which the railroads seem to go out of their way to turn down should tell you something about the mentality of our great "American" railroads.
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