Murphy SidingYour platoon speed would be dictated by the slowest unit in the group.
I would opine that this is a serious problem. Unless you want extended passes while one fifteen truck platoon passes another at a differential of a MPH or two, you're faced with all platoons running at the same speed as the slowest platoon.
Now you're into transit time and HOS issues.
Larry Resident Microferroequinologist (at least at my house) Everyone goes home; Safety begins with you My Opinion. Standard Disclaimers Apply. No Expiration Date Come ride the rails with me! There's one thing about humility - the moment you think you've got it, you've lost it...
tree68 Murphy Siding Your platoon speed would be dictated by the slowest unit in the group. I would opine that this is a serious problem. Unless you want extended passes while one fifteen truck platoon passes another at a differential of a MPH or two, you're faced with all platoons running at the same speed as the slowest platoon. Now you're into transit time and HOS issues.
Murphy Siding Your platoon speed would be dictated by the slowest unit in the group.
1 MPH passing difference is like the speed of light on I-81 today. It is more on the order of 1/4 MPH difference in speed.
Never too old to have a happy childhood!
BackshopI'm not so sure about that. How are you going to determine what speed to operate at? How will you determine acceleration? How about different turning radii due to different wheelbase. I have some real world experience in OTR trucking, do you?
(1) Speed is fixed by relevant speed limit, with the (previously-mentioned but evidently not well enough) understanding that any vehicle 'qualifying' for platooning of this kind on a given route segment would be maintained and loaded either to hold that speed or an agreed 'lower' minimum for defined grades or where there are dedicated lanes for controlled -- and constant, and predictable -- speeds.
(2) There is no necessary defined acceleration rate. As you apparently do not know, trucks with smaller engines can achieve a transiently higher rate of acceleration, even within relatively tight engine powerband (or pollution-generation-related) limits, using nominally lower gears or splits in the transmission and final drive. To the extent that acceleration and grade accommodation cannot be accommodated by a 'negotiated' map (controlling throttle and transmission probably well below the 'full acceleration capacity' of a given tractor) yes, the rate of acceleration would be determined in part with respect to the slower acceleration. But I expect, and I think you should too, that the actual rate of acceleration recovery up to the aforementioned speed limit (or 'traffic pattern' if that is slower) will always be relatively achievable, albeit with somewhat less transient economy for a minute or so...
How turning ratio factors into a system using feedback in spatially-derived metrics, or predictably using maps that implicitly include precalibration of steering angle and nose swing, is something best left to pissing contests among Swift drivers. The amount of variable swing at the back of a van depending on slide position is far greater, but is accommodated even in the Peloton system without difficulty.
There would be difficulty in an associated respect with something I don't see Peloton mention: hypothetical rapid evasive following of the 'next' couple of trucks behind one that has to dodge some obstacle. (The following trucks all do negotiated-effort antilock braking and, if necessary, emergency route following, so the idiot idea that 15 trucks go into the wreck like lemmings is not really more than a poor straw attempt at an argument, but we can assume that at least one or two of the platooning trucks would have to turn out with only seconds' warning and, for the sake of discussion, without any predictive sensor-fusion-derived 'warning' from the connected environment. The following driver (or autonomous pilot) has only whatever related view of front and sides is piped in via V2V and DSRC, so may need to respond only to virtual centroid path tracking and trailer-rear path to avoid either of the 'collisions' of concern while feathering the tractor and trailer brakes appropriately for directional stability. I cannot imagine that the steering-angle correction demanded here is so radically different at typical speed-limit as to constitute an absolute incapability; the duration of both the 'ramp' into and out of peak steering angle will be relatively small, and (as noted if you were listening) the effective steering ratio as well as steering kingpin angle will be in the control maps for the platooning system -- in a properly-designed system the steering angle will be modulated in servo, with reasonably fast feedback to determine skidding or other difficulties.
Now, of course the "excuse" here is that the system will safely follow at least what the best human driver faced with this situation would do. You can answer, quite rightly, that no professional driver would be following closely enough for best draft in the first place, and add (comparably rightly) that even with predictive synthetic vision giving ideal longer-term 'smart avoidance' there may not be enough time to avoid some kind of problem. These are correct, and if there is one thing about platooning I think is most certain, it is that lawyers will blame it for accidents whether or not they would have been objectively 'unavoidable' by reasonably skilled drivers in normal traffic. (And I think you can assume that companies like Peloton will be unsuccessful in asserting statutory immunity of some kind when, not if, those suits start to be filed -- as with the Roadmaster bankruptcy all the overpriced exercise bikes in America won't fill the deep pockets fast enough...)
Incidentally the idea that platoons stay 'connected' going into service facilities, or that trucks can't exit or enter running platoons easily with effective 'self-healing' of the running coordination, are at best ill-informed. Even the early automatic-highway designs weren't that naive.
I don't think ttrraaffiicc works for Peleton; they at least seem to have worked out their tech model and economics rationally, and to know how to discuss what their technology can and can't do at present.
BaltACD1 MPH passing difference is like the speed of light on I-81 today. It is more on the order of 1/4 MPH difference in speed.
In a commanded system it would be understood who would speed up at best rate, and who would slow down as appropriate, to complete a given pass within the (yet to be formalized but I almost can't wait for it to be) limits on extended passing time.
The fused GIS/GPS predictive cruise, incidentally, will easily restrict actual passing to downgrades and abort passing as upgrades approach. I expect there will be timers running to show non-platooned drivers when to pull out to pass, and how long they have to do it, but that's less germane to a discussion of a platoon programmed to the accurate speed limit that comes upon some driver going just under due to speedo error or stupidity, or who persists in dragging upgrade and then pulling out to pass while overspeeding going down -- that behavior ought to be prosecuted, and in a world of high-resolution guidance cameras streaming via V2V/DSRC to a cloud accessible to DOT enforcement, I suspect and strongly hope it swiftly will be... with appropriate points on a CDL and penalties to the line or owner.
So who's going to enforce all of this? Remember, all these trucking companies are in competition with each other. Who's going to tell one company driver to slow down so that their competitor can pass them faster. In the real world, which is the one I live and work in, it's not going to happen.
Overmod BaltACD 1 MPH passing difference is like the speed of light on I-81 today. It is more on the order of 1/4 MPH difference in speed. And all of it the result of uncontrolled drivers who are tolerated 'getting away with it'. In a commanded system it would be understood who would speed up at best rate, and who would slow down as appropriate, to complete a given pass within the (yet to be formalized but I almost can't wait for it to be) limits on extended passing time. The fused GIS/GPS predictive cruise, incidentally, will easily restrict actual passing to downgrades and abort passing as upgrades approach. I expect there will be timers running to show non-platooned drivers when to pull out to pass, and how long they have to do it, but that's less germane to a discussion of a platoon programmed to the accurate speed limit that comes upon some driver going just under due to speedo error or stupidity, or who persists in dragging upgrade and then pulling out to pass while overspeeding going down -- that behavior ought to be prosecuted, and in a world of high-resolution guidance cameras streaming via V2V/DSRC to a cloud accessible to DOT enforcement, I suspect and strongly hope it swiftly will be... with appropriate points on a CDL and penalties to the line or owner.
BaltACD 1 MPH passing difference is like the speed of light on I-81 today. It is more on the order of 1/4 MPH difference in speed.
And all of it the result of uncontrolled drivers who are tolerated 'getting away with it'.
Right in there with the Perpetual Motion Machine and the reinvention of humanity! In the face of a pandemic we can't even get people to wear masks.
BackshopSo who's going to enforce all of this? Remember, all these trucking companies are in competition with each other. Who's going to tell one company driver to slow down so that their competitor can pass them faster. In the real world, which is the one I live and work in, it's not going to happen.
Note that to put real teeth in playing with peoples' livelihoods that way, you need the spectre of easy scab replacement. With a driver shortage you don't have that. With autodocking, you start to be able to do Malbone-wreck-style hiring of kids out of 'driver mills'; when you get the threat of autonomous following or full level 5 operation, it gets to where full-on abuse and bureaucratic Mickey Mouse of the sort our government and 'Deep State' systems have so come to love can be imposed on whole segments of soon-to-be-borderline-poor folks who thought they were valued and essential personnel.
Thank heaven for people like Shadow's employer who will resist any temptation to have his people manipulated like that 'because it's expedient' (and perhaps supported by those screwing adequate revenue out of trucking after the high-capital paradigm shift who know where to apply the grease).
Something I think is an interesting use of ttrraaffiicc's paradigm is the promise of 'autonomous trucks' on platoonable lanes with inadequate reliable traffic to merit even greyhounds-style lightweight, rapid, effective TOFC rail support ... but with human pilots at either end, "called" as rail crews ought to be and Ubered to key boarding points. A bit like the ultimate 'work from home' with guaranteed cumulative volume, without the waste of full crews running full distance in every cab, but taking advantage of pools of people with the equivalent of The Knowledge in local or regional terminal guidance and last-mile skills. If I were ttrraaffiicc, that's the sort of thing I'd stress about the revolutionary but always-a-bit-too-imperfect technology he's so enthusiastic for.
Most of the trucks I see on I-80 are not from the large truck load carriers. Sure, they are out there, but most seem to be smaller outfits. So will they be able to afford all the technology that's just around the corner?
To me, it almost seems like the way the trucking industry works will have to change to really be able to use it to the advantages some people see. Just like when someone comes up with a new plan to save the railroad industry, but requires a major upheaval from the way things currently work.
Jeff
Meanwhile, I've been waiting for ttrraaffiicc to mention one particular great nominal advantage to either autonomous or semi-automated road-train operation -- the fact that even long-triple systems can be done without specially strengthened or lifting-optimized trailers of the kinds really needed for practical van intermodal that is faster than tired old circus loading with specialty yard tractors. Many places I saw intermodal tried with various kinds of sideloading, the trailers would sooner rather than later start to shred, sometimes in a spectacularly short number of transfers. There are few ways to build transfer equipment cost-effectively at all, let alone reliably, that will lift a potentially poorly-loaded trailer entirely by the bogie and the kingpin and place it precisely onto what may be an undecked kangaroo skeleton car in a reasonable time, in typical yard conditions, in what may be increasingly poorer weather conditions as 'global warming' pumps more dihydrogen monoxide into the "climate". Handling the same trailer entirely on its road wheels is a cinch by comparison, and much of the fancy zero-turn yard operation can be achieved with not-particularly-difficult adaptive brake and pony drive (let's say 312V electric for poor ttrraaffiicc to compare) applied to the pup-style bogies used for making up the road trains. I would note that the economics that were used for CP Expressway involved multiple trailers sent for one tractor, the schedule being arranged in parallel with one tractor making the parallel road trip. The tractor would then sequentially last-mile the trailers, then hook onto one of the return loads and go meet a corresponding number of laned trailers as appropriate -- return bobtail, if no load were returned, but having done the essential last-mile service that only a truck provides efficiently, at minimum time, cost, and overall complexity. When you have safe multiples wth distributed 'assist' drive, much of that economy becomes available to the 'pure truck' system -- and at least some of the trouble involved in formal platooning doesn't happen for the hard-coupled road train. That is an operating model that might have long-term advantages that narrow the range railroads have for comparable convenience and costing in intermodal. (It is not a killer app, of course, or the sort of 'disruptive game-changer insert buzzwords in desired order' that make for bold new theory trolling. But it does represent something that was proven to work well until relatively recently, and that the railroads are unlikely to go to the trouble of implementing... )
jeffhergertMost of the trucks I see on I-80 are not from the large truck load carriers. Sure, they are out there, but most seem to be smaller outfits. So will they be able to afford all the technology that's just around the corner? To me, it almost seems like the way the trucking industry works will have to change to really be able to use it to the advantages some people see. Just like when someone comes up with a new plan to save the railroad industry, but requires a major upheaval from the way things currently work. Jeff
PST - Precision Scheduled Trucking - get rid of the one trailer shippers and consignees - 10 a day or we don't want the business
jeffhergert... will they be able to afford all the technology that's just around the corner?
There are really enough historical examples just from EMD's strategy in dieselization of freight (and GMC's strategy in dieselizing local and regional transit) to show what will be needed, and what will be valuable.
It is ridiculous to think that even deep-pockets organizations can swing the development capital to build out the necessary systems themselves, let alone be willing to 'pioneer' the first-generation systems and learn all the unanticipated 'gotchas' and risks and emergent scams -- only to see their competition happily buy the costed-down 'perfected' version once it's established. There is a wide range of tariff argument alone involving this sort of thing (think Reagan with memory chips in the 1980s). The sort of tacit assumption is that the technology will get to adequate pervasiveness somehow, but absent the precise discussions of how this will work effectively with the men who manage money in this benighted economy, you should be highly suspicious of how it will practically evolve, and where key parts of the 'right' paradigms get left ignored or suborned.
...and make no mistake, there are many areas in ttrraaffiicc's future-so-bright idea where 'good enough' compromise is NOT going to let the paradigm thrive. It distresses me that he seems either unwilling or unable to realize this.
I don't think KLLM wants to put containers away anytime soon..
We seem again to be at the intersection of roads and rails, and no not a level grade crossing. Also a bit of 'trolling' sprinkled over, I think if I could I would requote for emphasis a good bit of what Overmod has posted.My background, I started my career in ramp operations management for one of the top 5 IMCs (used to be top 3 but I think they've slid since I worked there) bouncing around on site at the various Class I partner facilities, and have since moved into a logistics group for a major shipper of commoditized goods (took a chair on the other side of the table basically) -- the core responsibility of the latter is designed the network to fill our customer's orders while negotiating and controlling costs with our carriers.
This all being said, I’d like to throw my hat in the ring to this conservation, hope to lend some insight into some of the various points mentioned. There seems to be a notion from the author of this thread, to whom I’ve address other points in other threads of a similar nature, that the trucking industry is has some sort of extreme cost advantage over rail/intermodal services or by some magic swing of a pendulum, will make obsolete rails by switching to a semi or fully autonomous state. My opinions on the ‘obsoleteism’ of rail are well documented again in other threads that simply put, it is too big and important a cog in the supply chain to simply be replaced by trucks (remembering again depending on car capacity you have 4-5 trucks for every single railcar out there so the physical ability to replace trains with trucks on a the flick of a switch is nearly impossible anyways…). Also the cost advantage of rail at the economies of scale are real, so don't doubt that for a minute if you've got a million tons of product to move in a year you need a reliable rail connection as part of your carrier mix and supply chain strategy.
For this piece I’d like to explore a bit more about the trucking side. Again, I worked for a jolly orange prominent IMC out there, well endowed in both the intermodal and trucking side of the equation. Something I thought interesting mentioned early on in this thread was a notion that ‘trucking costs are variable’. Nothing could be further from the truth. If you don’t know how much it costs you to pay your drivers, maintain your trucks, pay you SG&A for all the support, mechanic, operations, IT, CS, TMS’ and other odd&ends... Not to mention the budgeting that goes into all of the fleet improvements year over year then you have no business running a trucking company. The only variable cost is fuel, which is passed on mostly to the customer as a FSC and a separate line item measured weekly. Now we can say that yes, the cost structure or ‘liabilities’ are different between a railroad and a trucking outfit, but you should know in what core lanes you operate, what your cost per mile loaded, empty and bobtail are.
If you didn’t have a high fixed cost business, pricing would be nearly impossible. Think for example in your own home, you think that sure, my electric bill is variable because it depends on how much electricity I am using… but at the end of the day we establish operational patterns, and those create baselines we can measure. So you know how much per month your operating costs for your house should be, and you already know when it is high within 10 seconds of looking at it. That is usually due to a change or a behavioral issue that you can and usually address, so the logic is similar because if you didn’t know month to month how much it would cost to operate your home, you likely wouldn’t own one for very long (exceptions being people who have no concern over $$ )
Back to trucking, you have x amount of tractors, y amount of trailers (owned, leased or otherwise) so you should again know what your capacity is at any given time relative to the asset utilization of your fleets. And remember, pricing is a function of capacity. The model as of late, and this was true of my tenure, was that of the airlines -- sell 110% of your capacity. End of the day, you cancel, you push, you ‘prioritize’ with the customers and really they’re used to it anyways. The best that I still get is ‘I had several drivers call out today’... yes they do call out but day-to-day it's really not that many as they do really enjoy getting paid.
So again knowing how much it costs to operate your fleet (usually per mile), knowing how many load miles you need to run and the price point you can make it and operating at your capacity are all critical elements. Someone mentioned speed, why do trucking companies pick certain speeds? Fuel consumption and their philosophy around it. We had a fleet of trucks less than 3 years old average age governored at 60 at the time I worked there (its probably changed by now they place with this quite a bit just like how the RR’s constantly tinker with operations), one of the slowest there was. Some smaller fleets don’t have a governor at all, so the philosophy is at what speed can you provide the best service, but at the optimal fuel efficiency (trucks frequent mid-single digits to low double digits in MPG). Then of course, maintenance of the tractor factors into that too… again another cost.
Understand, or I should say lack of understanding (or caring/managing) these costs can be to your own peril. The last two years or so saw a tremendous number of trucking outfits go belly up… they weren’t well managed is the simple truth they didn’t have a good grasp on their operations. Even the traditional trucking models for some of these big box guys have changed in that time, because at the end of the day they were bleeding and needed to think outside of the box. Now you see the shift towards more contracts and committed volumes, one might even say take-or-pay type arrangements (wonder where trucking got that idea…?) and the dedicated programs for large customers have all been the latest to forecast consistent volumes and ‘eliminate the surprises’. I’ll actually throw a poll to the audience -- what do you all think is a good loaded ratio for intermodal/truck? And how many loads per truck per day (within HOS) is considered good for a local intermodal driver?
Historically speaking we’ve seen intermodal pricing lower than TL (in shorter lanes it can be a 5-10% advantage, but coast to coast or long haul you can reach upwards of 50%) and that has been for a variety of reasons but mostly the longer the haul the greater cost advantage to rail due to the efficiencies of the rail networks. Disruptors to that as of late is the widely known PSR movement that axed a lot of low density and other odds & ends services, which after hitting the proverbial ‘reset’ button, end up finding their way back into the market and service mix of the railroads as they move back towards beefing up their volumes. When TL pricing dips below intermodal pricing, which happened recently in 2019 (coulda been 18 but I think it was last year), then there is a problem in the market which is overcapacity. Too many trucks, not enough loads and it's a race to the bottom. What contributed to these lack-luster volumes the last few years…. A trade war maybe? Actual demand stagnant? You be the judge (and please don’t quote the DOW, the stock value of the top 30 companies in the US is really a poor measure of overall economic health, any real economist will tell you that).
Trend wise, modern truck drivers don't like the long haul as much as their historical counterparts, but rather enjoy the terminal life, where you can be home every night (or every other in extended regional fleets). Another thing to remember, not nearly every truck you see is loaded. In fact I posed the question above, but you’d be surprised how many empty trucks are out on the road. Repositioning moves or deadhead miles come at a cost (who has heard the joke about sailboat fuel?). Bobtails certainly come at a cost and should be avoided, because for everyone 1 bobtail move you create, you will likely inevitably create another one (all bobtail moves come in pairs for terminal based operations). Anyone ever hear the term ‘boxwork’ as a part of operations? That's a service cost to the customer, you want to move loads with them and you say you’ll have a pool of 3 containers/trailers at their yard which works great (empty in and load out remember) until your pool goes down to 2 with a commitment of 3 after a trailer is OOS, missing, or a driver skips assignment and bobtails in (thus not replenishing the pool). You’d have at least one driver a day doing just boxwork, getting chassis/trailers to a nearby repair shop, finding the one that has been idling for several days (usually for good reason), pulling the one that smells like cat litter and was rejected (I’ve had trailer rejects for a variety of things including ‘blood’).
Well, I think I’ve gone off the rails on my post. I’m not really sure if I established any points here or just rambled along about the insights into the trucking industry. Like the railroads, they are challenged as well. And to be honest one of the biggest challenges in the industry is keeping those drivers in the seat. I’m not sure what the turnover is for the railroads, but for some trucking outfits it's upwards of 50% for drivers. So the appeal of reducing headcount to the trucking companies is really something they’d like to explore…and push (the political piece being mentioned already, that’ll take some work for certain). Something that has always fascinated me is the difference in the trucking industry from the US to Canada. Legal road weights, HOS and the doubles/triples really create a different environment. It’s always fun too to mix and match as some border states adopt the Canadian standards and can leverage shipping a load from Vermont to Michigan via Canada at 100K Max/gross.
Anyways, maybe you learned something, maybe you didn’t, but I think my overall point is there is more to the story than reading an article, and if someone could have found a way to make the railroads obsolete by now they would have. We are in it for the long haul for both the trucks and the rails.
Thank you. That was educational.
Thanks to Chris / CopCarSS for my avatar.
Just a little side track about trucking. I have lately be watching a number of YOUTUBE video's of MIDWEST TRUCKING. These are of a high strength tow truck operation that handles semitrailer accidents. Man is a pro at his job. But when you see the damage that can be done to a truck, and the time and effort to clean it up, (much smaller than a RR crash) I wonder how that factors in the business case for trucking.
Electroliner 1935Just a little side track about trucking. I have lately be watching a number of YOUTUBE video's of MIDWEST TRUCKING. These are of a high strength tow truck operation that handles semitrailer accidents. Man is a pro at his job. But when you see the damage that can be done to a truck, and the time and effort to clean it up, (much smaller than a RR crash) I wonder how that factors in the business case for trucking.
Ron Pratt of Midwest Truck out os Scott City, MO
Thanks, CMO. And you are now "on the other side of the desk!!"
One thing that puzzles me about containerization and how it has grown from the original 20 foot box - from container ships being measured in TEU's (20 foot equivalent units). Growth from 20 foot to 40 foot was a no brainer. But the next lengths brought to the market were 48 foot and then 53 foot. The question in my mind is why did the industry didn't (and hasn't) gone to 60 footers?
I know there are a number of restrictions on truckers in the US on length and I suspect there are also restrictions throughout the rest of the world. But, the container industry is BIG business all around the world - big business has big money and big money gets the laws it wants.
BaltACDThe question in my mind is why did the industry didn't (and hasn't) gone to 60 footers?
A 53' box is already a kludge, no longer on a common ship 'module'; it specifically represents a 'Western' van trailer length. While it is possible that the length could be extended, 53' is already way too long to go many, many places, and loading it to 'capacity' leaves you concerned with weighing out at the cubage that would have fit in a compatible 48' -- remembering that you have to balance and dun the load both longitudinally and transversely.
As happens, there has been an experiment with 60' containers, in captive traffic that suited the increased cubage. That was for Canadian Tire, and I suspect someone like greyhounds can tell the story better than I could.
Meanwhile, check how the permitted combination weight increases as you get from 48' up with full intermodal box strength. The economics of the RailRunner were badly under water with 48' units ... now consider the same axle-weight limits, and no amount of lobbying will get those increased with so much damage from trucks already publically obvious, and then consider the vise between having to fill the whole 60' length with goods that don't weigh out prematurely. Even if you have, or can tie into, an effective freight forwarding agency or 'express' line for efficient LTL, there's a lot of empty space for your full-price perilously-long can.
Now, it might have been interesting if LASH had caught on to see whether lightering could make something of a 60' module loaded to non-road weight, drayed only to terminals, and loaded to facilitate rapid (and as automated as possible) transfer to right sized trucks (or to stuff that worked with existing well cars).
In some limited areas, it has. CN and CP move a small fleet of 60ft containers for Canadian Tire. I have seen these myself on one occasion. They are only allowed on certain certified road routes and must ride on the top of a stack.
Besides longer containers/trailers grossing out before cubing out, there's also the matter of manuveurbility while on the road.
BackshopBesides longer containers/trailers grossing out before cubing out, there's also the matter of manuveurbility while on the road.
I would feature a single 60 is more manuverable than the doubles and triples that I have seen on the roads.
BaltACD Backshop Besides longer containers/trailers grossing out before cubing out, there's also the matter of manuveurbility while on the road. I would feature a single 60 is more manuverable than the doubles and triples that I have seen on the roads.
Backshop Besides longer containers/trailers grossing out before cubing out, there's also the matter of manuveurbility while on the road.
Backshop BaltACD Backshop Besides longer containers/trailers grossing out before cubing out, there's also the matter of manuveurbility while on the road. I would feature a single 60 is more manuverable than the doubles and triples that I have seen on the roads. Yes, but doubles and triples can be broken apart when going into urban areas. A 60ft stays a 60ft. Turns are an adventure.
Yes, but doubles and triples can be broken apart when going into urban areas. A 60ft stays a 60ft. Turns are an adventure.
Isn't that what Distribution Centers have been developed to serve - Mass quantities to the DC, store sized quantities from the DC to the stores.
A single 60 vs. double 27's. While the 27's can handle more gross, they also present more tare - loaded or empty.
Bruce D GillingsThe world is changing. It is less and less about rates on commodities of any value other than the low-end bulk moves and a small number of non-bulk moves. It is about supply chain costs. And that is where railroads are getting skunked, and badly. And the shift to controlling supply chain costs is accelerating. Unpredictable/unreliable service translates to higher costs in warehousing, labor, inventory, and the loss of customer satisfaction. The evolving ability to analyze the cost impacts is not boding well for railroading. The railroad attitude of “my way or the highway” more and more means the highway. Lower rates do not equal lower costs. And poor service makes the risk of alienating YOUR customers because you couldn’t deliver on time because the railroad switched to PSR and ran trains too long for sidings/yards that died on the law; and had maintenance windows that made an already-late Z train later by 6 more hours; and all the other reasons. Railroading is losing market share. Not just because of the loss of coal, or trade wars, or Covid. But because they are failing to understand their customers. Their financial focus is on their own costs, not the costs/impacts to their customers. If that doesn’t change – soon – then freight railroading will become a niche operation in a limited number of heavy haul lanes.
Railroading is losing market share. Not just because of the loss of coal, or trade wars, or Covid. But because they are failing to understand their customers. Their financial focus is on their own costs, not the costs/impacts to their customers. If that doesn’t change – soon – then freight railroading will become a niche operation in a limited number of heavy haul lanes.
+1.
Bruce, great post.
Allow me a friendly rebut if you will --
Lets talk load utilization. And I can only speak to my experiences, mostly shipping a high density commoditized good that doesn’t have any utilization issues (IE I weigh out before I cube out every load). My reference of a 1 railcar to 4-5 truckloads holds true, I can load a C plate to 156Klbs and an F Plate to 209Klbs, whereas I load van-trucks to 45 to 46K going over US federally subsidized highways and outside of established state coalition zones. I’ll load ‘cans’ up to 43,500lb without legal weight issues. The utilization of the box vs van is really not a huge issue and doesn’t drive the needle cost wise. A load for me however isn’t a load for the Walmarts or Amazon’s of the world. Retail goods have a lot of air and dead space in that packaging (styrofoam), so they typically cube out before they weigh out (or get to some equilibrium that is close). Also, its foolish to think every box has perfect load utilization, you wouldn’t believe how many trucks or boxes are out there that are empty (we'd call it a repo move, meanign reposition to a different market area with better freight prospects) or loaded with 10K, 20K and only half or partially cubed. Some companies don’t care, they just need to ship something and they don’t like the LTL networks. Actually intermodal is a good fit for some of these, better price point and the service is good (compared to even 10-15 years ago). We used to repo 5-10% of our boxes out of the East coast markets to Chicago/Midwest daily because they were high consumer markets and produced less than they consumed. The rail gave us a break to move empties and it saves you having a driver wonder around miles and miles looking for a load. If you couldn't sell the capacity on the spot market, get that box back to somewhere it's useful (you touched upon asset utilization imagine that and we did it most everyday).
You’ve dialed over from load utilization to asset utilization. Again, your assumption relies on the idea that a truck driver drives 1000 miles, drops off a load either D&H or live unload, and grabs a load within 1 mile of his drop and returns exactly to his point of origin. The freight markets don’t work that way… and again, drivers aren’t perfectly utilized on their assignments (oh your van was rejected and the nearest empty is 200 miles away?). I’m not saying rail is perfect either, but the terminal model with intermodal makes things simpler -- everyday you start and stop at the same place. Flat tire? Broke down tractor? It’s easy to recover the load when you have more assets working a marketplace. I think comparing asset utilization of a railcar vs a truck is really a poor idea, thats apples and oranges. Rail is a conveyor belt, you plan on recieving x amount of cars a day. Also I forgot to mention, if you are a shipper the most important thing with railcars are not sending out the loads, but taking the inbound empties. Here’s another advantage of mixed modes in the supply chain you probably didn’t think of (I didn’t think of it until just this second since my warehouse days are long over)-- labor management. Remember, before a load can leave a warehouse, it needs to be built in a system and that translates to the floor. You plan on loading 100 trucks a day at 40 pieces each, that means you have 4000 pieces in your warehouse you need to find, stage and move efficiently… each...day. You fall behind? Tomorrow will be worse. What’s that I see outside? Oh its a truck line, D&D starting to rack up, drivers on the clock, turning around, VNU charges…. Yeah been there. Railcars offer labor flexibility, lets say you have 20 rail spots and a switch every 2 days. You can load those on your own time and it eases the burden of having to manage more smaller loads with each truck having its own unique issue. D&H loads offer some more relief there, but thats not perfect either (and requires a yard service)
The other thing I think you’ve overlooked is the value of each mode working together in the entire supply chain . A widget factory reached production efficiency when it can make 100,000 of widget ‘A’ all on a single run, but is there market demand at that time for all those? No. Maybe the order book over the next 2-3 months will cover that demand, but we have to get product off the floor so we rely on the slower, cheaper modes and put product through an intermediary RDC or warehouse, whereas we can truck/intermodal some loads that are more urgently needed. That’s the value of the supply chain (end to end), maintain efficiency in your core operations. Remember for shippers, 99% of them logistics is not their core function, it’s making or consuming stuff. They really sometimes are so focused on that they realize they are within one day of shutting down a production line because they are out of physical space in their warehouse. I’ve loaded boxcars, stuff ‘em in the yard and called it a ‘warehouse’ to my boss. SIT cars come in handy too, especially if you have a good shortline partner who is happy to plug ‘em somewhere (the PSR fad does not look keenly on SIT cars).
If you look at the FHA data, the highways could certainly not handle all the tons of volume handled by the rails. How long does it take to add an additional lane to a highway that is 100 miles? We’ve all suffered through the chaos of additional lane construction that seems never ending. Capacity can’t come out of thin air.
I'd be curious to know where you get the 2-1 factor for railcars? Again, we go by weights in boxcars, hoppers, ect. Remember we pay per load per mile in trucking, so a truck 1000 miles costs $1000 whether you put one pallet on it or 40. A railcar is billed in weight classes and miles, so <140K is one weight class, 140-170, may be one, 170-200 another and 200K+ its own price per mile. Autoracks our outside of my purview, so I won’t pretend to know anything about that. Tank cars are interesting, some chemicals in transit separate or ‘lose suspension’ or encounter a physical property change. So rail on some of those can be problematic if you encounter issues along the way.
A lot of the raw materials like that are on auto-reorder points and inventory management programs where a company’s inventory of raw material (lets say Latex) is monitored or mapped remotely by the vendor/merchant/supplier, and they establish a threshold to say, when you reach 30% of your inventory we send you another tank car of Latex, which takes 20 days to reach you (and in 20 days you’ll be down to 15%). The customer tries it, tweaks it, then agrees and eventually it's not something they end up really managing, but rather its something they expect. One of the supply chain managers I worked for early on in life told me that when something just shows up when you need it and you don’t have to think about it, everything is going right. A lot of the ‘Hey Frank do we need to buy more raw materials’ days are over, the inventory management models are created to ensure supply never runs out, and usually only during an exceptional period or a supply shock are there problems (I feel like every year up north LPG is always a problem in Q1/Q4 like everyone forgets winters are cold)
The loss of market share has mostly been coal but largely PSR…. let’s not ignore that for a second. You had to drag the STB into the CSX implementation, things got ugly really fast there. But I disagree on the failing to understand their customers. In fact, I think they are understanding our needs more and more. They come in and discuss with us all the things they are doing to become more of a ‘one-stop’ solution. They're getting better in their systems, and the blend of intermodal capability into their service mix to offer a truck like solution is getting better all the time. In fact, they wouldn't offer intermodal at all if they didn't care about capturing the volume (remember the retail vs wholesale model of intermodal too) Again, withstanding COVID, I’d say the PSR movement has really been the issue with market share, and a lot of that is driven from the top trying to boost that almighty market cap. A lot of the ops and sales people are really trying to make it customer centric, but the rug in a lot of cases has been pulled from beneath them. Railroads as a ‘niche’ supply chain option is akin to saying that SUVs are going to become a ‘niche’ in the vehicle market (and there are a lot of people that say that time to time) in the future.
I'll do a more comprehensive follow up later but I tend to disagree still on some points. What I've been seeing has been the charge towards intermodalism, LTL guys are buying boxes now (Estes, ABF, YRC, ect) and major retailers (Walmart, Amazon) are getting their own in the US following the Canadian Tire success story. I can't think of a more high priority traffic than UPS or FedEx, and yet they ply the rails. Nothing I see as of now indicates that is in jeopardy.
Bruce D GillingsCan highway handle most of what is moving on intermodal now? In time, yes. Hell, it already does in most lanes. Only in a handful of lanes would the loss of rail service overburden the roads. In most lanes, intermodal share is a rounding error. (Okay, that may be an exaggeration, but not too much of one). In the I-5 corridor, if UP stopped running everything (intermodal and carload), truck traffic would increase about 30% north of Roseville. Less so south of there. North of Las Vegas, the complete secession of UP service would increase truck traffic on I-15 and I-70 about 20%. Lane after lane after lane is the same. The Southern Transcon and a few others are the exceptions, not the rules.
Bruce D GillingsBut as LCVs are allowed on more bulk loads in more states, and allowable truck weights increase. Sorry to all who bemoan that, but follow the money…the damage done by trucks to our nation’s infrastructure already is just a precursor of the future. Governments in a handful of states complain about it, but the Feds and most states just respond with deeper cross sections and stronger bridges, and funding will happen one way or another. The public is too hypnotized by whoever is being eliminated from AGT or Survivor to have any understanding of complex issues like transportation infrastructure costs. A handful of states will likely fight the heavier bulk LCVs, but most will allow it. Short- to medium-haul heavy, non-unit train moves will increasingly switch to OTR.
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