Well it appears Maine potatoes are hitting the rails again! Albeit in a much reduced capacity... Anyhow.. Roughly 3 weeks ago LaJoie Growers LLC/Grand Prix Inc. Shipped two UP reefers full of Maine Russet potatoes billed to the West Coast. I can't share the video here, but if you have a Linkedin account. Login to view the video. Here's the link.
https://www.linkedin.com/posts/jay-lajoie-00701939_our-first-two-of-many-up-rail-cars-full-of-ugcPost-6877533451751317504-ufE6
Not sure if this traffic will redevelop, and in order for it too. Rails will have to show consistent reliability. Don't let Penn Central leave a bad taste in your mouth.. This traffic can be regained if the C1's want it.
Well, McDonalds just chartered three 747 freighters to move US french fries to Japan. They were running quite low over there. And now, the McDonalds in Taiwan are short of hash browns. You gotta' do what you gotta' do.
Penn Central did bankrupt some Maine potato farmers. They had temperature controlled shipments of spuds en route when PC filed bankruptcy. In the chaos the potatoes went bad. Normally the railroad would have paid a freight loss and damage claim. But everything was delayed in court and the farmers ran out of money waiting.
I'll check out Maine potato production, but I don't think it's what it used to be.
OK, as a former marketing guy I just find this stuff fascinating:
https://www.nass.usda.gov/Publications/Todays_Reports/reports/pots0920.pdf
What I see is revenue and profits. Maine produces 3.94% of the potatoes in the US. Idaho and Washington produce 56.51%. (Page 8) And people here eat a lot of potato stuff. (65.5 pounds retail weight for every man, woman and child in 2019) So, focus on Idaho and Washington.
If I was the head UP honcho (in my wildest dreams) I'd call in the VP of marketing, the VP of operations, and the VP of finance. I'd tell them if one load of potatoes went east of Denver by truck, or South of Salt Lake City by truck, or west of Reno by truck, they'd better have a very good explanation.
And do not forget about the onions and apples.
If you were the El Grande Heffe of the Yellow Peril, your Operations manager would simply report back that there is no money to be made in moving potatoes because of the restrictions imposed by the post-PSR regime driven by finance and the lack of "service" that that demands. You have already driven anything of a competitive nature over to BNSF.
While you're at it, the Colorado red potato market is basically controlled by UP as SL&RG and SLC can only interchange with UP. (Since UP bailed out of the San Luis Valley and Ed Ellis mishandled the SL&RG, almost all of the San Luis Valley taters leave by truck [taxpayer subsidized] from the packing houses. Anything time sensitive is doomed by the paper barrier at Walsenburg where SL&RG cannot reach BNSF)
mudchickenIf you were the El Grande Heffe of the Yellow Peril, your Operations manager would simply report back that there is no money to be made in moving potatoes because of the restrictions imposed by the post-PSR regime driven by finance and the lack of "service" that that demands
Nevermind.
It's been fun. But it isn't much fun anymore. Signing off for now.
The opinions expressed here represent my own and not those of my employer, any other railroad, company, or person.t fun any
greyhounds mudchicken If you were the El Grande Heffe of the Yellow Peril, your Operations manager would simply report back that there is no money to be made in moving potatoes because of the restrictions imposed by the post-PSR regime driven by finance and the lack of "service" that that demands If I were in that position (dream on) his/her giving such a response would cause me to consider requiring him/her to find another source of income. Such a response would indicate that he/she doesn’t understand the micro-economics of our firm. And that should be the first requirement for any high-level position in any company. Railroads are volume driven. Up to the point of congestion, more volume equals lower average costs per load. Get the freight on the railroad if it covers its incremental costs. Adding some potato loads to an existing train cost but few extra bucks. But it can kick up revenue big time. Also, and furthermore, and henceforth, that’s why you’ve got to include the finance people in the assignment. You want the money folks understanding and supporting the endeavor. Not fighting it.
mudchicken If you were the El Grande Heffe of the Yellow Peril, your Operations manager would simply report back that there is no money to be made in moving potatoes because of the restrictions imposed by the post-PSR regime driven by finance and the lack of "service" that that demands
You would never have risen to such a high position in a PSR railroad. The first and only goal is keeping the operating ratio low and keeping the shareholders happy. The easiest way to do this in the short term is to make cuts and not try anything new.
Finance people don't need to understand the nature of their company's operations because their jobs have nothing to do with that, this also applies to HR. Their purpose is to cut costs and funnel money to the shareholders. That's it. If you can do that at one company, you can do it at any company.
Or so think upper management and shareholders.....
Greetings from Alberta
-an Articulate Malcontent
SD70DudeYou would never have risen to such a high position in a PSR railroad. The first and only goal is keeping the operating ratio low and keeping the shareholders happy. The easiest way to do this in the short term is to make cuts and not try anything new. Finance people don't need to understand the nature of their company's operations because their jobs have nothing to do with that, this also applies to HR. Their purpose is to cut costs and funnel money to the shareholders. That's it. If you can do that at one company, you can do it at any company
I agree with Greyhounds that the cream should rise to the top. The problem with P$R and chasing the OR is that said cream probably gets shut down if they propose something like what we're discussing.
You can only do what you're allowed to do, no matter how great an idea sounds.
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...
I think sector dominance within corporations runs in cycles. At one time with many rails it might have been operations, then marketing. Now it's finance and accounting with PSR riding the wave. That might look very different in a few years if BNSF's approach wins out. If not...?
SD60MAC9500Well it appears Maine potatoes are hitting the rails again! Albeit in a much reduced capacity... Anyhow.. Roughly 3 weeks ago LaJoie Growers LLC/Grand Prix Inc. Shipped two UP reefers full of Maine Russet potatoes billed to the West Coast. I can't share the video here, but if you have a Linkedin account. Login to view the video. Here's the link. https://www.linkedin.com/posts/jay-lajoie-00701939_our-first-two-of-many-up-rail-cars-full-of-ugcPost-6877533451751317504-ufE6 Not sure if this traffic will redevelop, and in order for it too. Rails will have to show consistent reliability. Don't let Penn Central leave a bad taste in your mouth.. This traffic can be regained if the C1's want it.
I think this is good news but one item I have always wondered is if they could get the perishible freight expedited in a hot shot type train through Chicago FAST, without all the typical delays and around the congestion. I trully wonder if more perishible West to East Coast and vice versa traffic could not be handled. Because the only reason in my view that rail does not have more of this traffic segment is total shipping time and in my view the culprit is Chicago and it's congestion. Get a train to the West or East Coast in less than 4 days and you got a winner for perishable traffic......in my view.
CMStPnP SD60MAC9500 Well it appears Maine potatoes are hitting the rails again! Albeit in a much reduced capacity... Anyhow.. Roughly 3 weeks ago LaJoie Growers LLC/Grand Prix Inc. Shipped two UP reefers full of Maine Russet potatoes billed to the West Coast. I can't share the video here, but if you have a Linkedin account. Login to view the video. Here's the link. https://www.linkedin.com/posts/jay-lajoie-00701939_our-first-two-of-many-up-rail-cars-full-of-ugcPost-6877533451751317504-ufE6 Not sure if this traffic will redevelop, and in order for it too. Rails will have to show consistent reliability. Don't let Penn Central leave a bad taste in your mouth.. This traffic can be regained if the C1's want it. I think this is good news but one item I have always wondered is if they could get the perishible freight expedited in a hot shot type train through Chicago FAST, without all the typical delays and around the congestion. I trully wonder if more perishible West to East Coast and vice versa traffic could not be handled. Because the only reason in my view that rail does not have more of this traffic segment is total shipping time and in my view the culprit is Chicago and it's congestion. Get a train to the West or East Coast in less than 4 days and you got a winner for perishable traffic......in my view.
SD60MAC9500 Well it appears Maine potatoes are hitting the rails again! Albeit in a much reduced capacity... Anyhow.. Roughly 3 weeks ago LaJoie Growers LLC/Grand Prix Inc. Shipped two UP reefers full of Maine Russet potatoes billed to the West Coast. I can't share the video here, but if you have a Linkedin account. Login to view the video. Here's the link. https://www.linkedin.com/posts/jay-lajoie-00701939_our-first-two-of-many-up-rail-cars-full-of-ugcPost-6877533451751317504-ufE6 Not sure if this traffic will redevelop, and in order for it too. Rails will have to show consistent reliability. Don't let Penn Central leave a bad taste in your mouth.. This traffic can be regained if the C1's want it.
Don't know that speed is required for perishable shipping. It wasn't back when we were kids. Stuff from the PNW and other food growing areas were shipped via circuitous routes in order to give the growers the time to find a buyer for what they were shipping. During trans the product would eventually be sold and the car(s) contining the product would be reconsigned and diverted to the ultimate customer.
Never too old to have a happy childhood!
greyhounds SD70Dude You would never have risen to such a high position in a PSR railroad. The first and only goal is keeping the operating ratio low and keeping the shareholders happy. The easiest way to do this in the short term is to make cuts and not try anything new. Finance people don't need to understand the nature of their company's operations because their jobs have nothing to do with that, this also applies to HR. Their purpose is to cut costs and funnel money to the shareholders. That's it. If you can do that at one company, you can do it at any company Well, I didn’t rise to such an elevated position anywhere. But I strongly disagree with the idea that: “Finance people don’t need to understand the nature of their company’s operations.” I’ll use the example of Katie Farmer, the new BNSF CEO. The railroad spent decades developing her recognized innate talents and abilities. Evaluating her as she was moved to positions of ever-increasing responsibility in various departments. She worked in operations, marketing, and finance. Those departments, and others, all interact. And such interactions need to be understood by all those involved. This includes people well below the CEO level. Otherwise, there will be a sub-optimization of the company’s performance. A well-run company will move talented people into various departments so that they develop diverse experience and knowledge. In the end it must all come together well and that won’t happen if one department dominates to the extent that over all corporate performance is harmed. Does every company do this? Hell NO. But the best ones do. I do agree that “The Cult of the OR” got out of hand. Especially at the UP.
SD70Dude You would never have risen to such a high position in a PSR railroad. The first and only goal is keeping the operating ratio low and keeping the shareholders happy. The easiest way to do this in the short term is to make cuts and not try anything new. Finance people don't need to understand the nature of their company's operations because their jobs have nothing to do with that, this also applies to HR. Their purpose is to cut costs and funnel money to the shareholders. That's it. If you can do that at one company, you can do it at any company
"The Cult of the OR" was out of hand when it was first created. I get it, businesses need to be profitable and have an obligation to run efficiently, but obsessively focusing on improving one number was never a good idea, and runs directly against the idea of adding revenue to existing trains where you can.
The finance people have been in the driver's seat for years, and there is precious little real-world experience in today's executive suites. I agree that all executives need to understand the fundamentals of the field in which their company operates, but that's not where the North American business world sits right now.
We had a real good COO (Mike Cory) for a few years who had started out as a labourer on the shop floor in Transcona. He was moved around the company over the years as you described, mostly in various transportation and operations managment positions though he did also spend some time in customer service and marketing.
I think he didn't last as COO because he kept spending money on silly things like double track and new locomotives, as well as adopting a more respectful approach to on-the-ground employee relations, all the Hunter-era harassment disappeared overnight after he was put in charge (it has slowly been coming back since he left).
In his three years Cory did more for CN than every other executive of the last 20 years put together.
It's not just that finance people are in charge. I believe Lance Fritz has always been in fiance, but I've heard that he wasn't keen on going down the PSR route as hard core as he has done. CEOs are also just employees. They need to deliver what the majority ownership of shares wants. (You don't have to own 51% of shares, just convince the owners totaling 51% of shares to follow the path you've proposed.) If they want large returns, as soon as possible, with no concern of long term ramifications, the managment team had better deliver. Or there will be a new management team in town. In this day and age, I think this affects almost every industry.
That being said, I've been working for over 23 years on the railroad. Almost every year it seems we announced record or near record profits. Without the cutting and gutting and termoil that G-55 (a lighter form of PSR) and the more aggressive full blown PSR has brought. Yet it wasn't enough for the activist investors and hedge funds. They saw, and see, money that they think should be in their pocket.
Jeff
jeffhergertIt's not just that finance people are in charge. I believe Lance Fritz has always been in fiance, but I've heard that he wasn't keen on going down the PSR route as hard core as he has done. CEOs are also just employees. They need to deliver what the majority ownership of shares wants. (You don't have to own 51% of shares, just convince the owners totaling 51% of shares to follow the path you've proposed.) If they want large returns, as soon as possible, with no concern of long term ramifications, the managment team had better deliver. Or there will be a new management team in town. In this day and age, I think this affects almost every industry. That being said, I've been working for over 23 years on the railroad. Almost every year it seems we announced record or near record profits. Without the cutting and gutting and termoil that G-55 (a lighter form of PSR) and the more aggressive full blown PSR has brought. Yet it wasn't enough for the activist investors and hedge funds. They saw, and see, money that they think should be in their pocket. Jeff
I am surprised that the bean counters don't want the OR to be in negative numbers.
SHhhhh!!!!
BaltACDI am surprised that the bean counters don't want the OR to be in negative numbers.
I'm on the board of our local ambulance. We'd like to be able to make a little money by putting some in bank savings (they frown on NFPs making riskier investments), but the interest rates are so low that I often wonder aloud if we aren't lucky they aren't charging us for the priviledge of holding our money...
jeffhergert Without the cutting and gutting and termoil that G-55 (a lighter form of PSR) and the more aggressive full blown PSR has brought. Yet it wasn't enough for the activist investors and hedge funds. They saw, and see, money that they think should be in their pocket. Jeff
Without the cutting and gutting and termoil that G-55 (a lighter form of PSR) and the more aggressive full blown PSR has brought. Yet it wasn't enough for the activist investors and hedge funds. They saw, and see, money that they think should be in their pocket.
Cash, unlike a rail line or a boxcar, can be readily moved to other investments or countries - whatever offers the best short or medium-term potential ROI. If you're a top executive of a railroad controlled by such a fund, you either get with the asset liquidation or are out of job in short order.
tree68 BaltACD I am surprised that the bean counters don't want the OR to be in negative numbers. I'm on the board of our local ambulance. We'd like to be able to make a little money by putting some in bank savings (they frown on NFPs making riskier investments), but the interest rates are so low that I often wonder aloud if we aren't lucky they aren't charging us for the priviledge of holding our money...
BaltACD I am surprised that the bean counters don't want the OR to be in negative numbers.
With the rates they are paying for our deposits versus what they are charging for loans - effectively we are paying for having our money depositedl
tree68I'm on the board of our local ambulance.
I have had local first responders take my wife to the hospital twice. Once she was at a park district facility and a neighboring FD EMT crew filled in for our towns. EMTs On the second occasion, our towns FD EMTs handled the call. Saw in my Medicare & BCBS statements that it was billed and covered for one but the other never appeared. Does your board bill for calls?
Electroliner 1935Does your board bill for calls?
Yes, we do. And we're a not-for-profit.
Unfortunately, we sometimes have to accept what the payer will pay (Medicare, Medicaid, insurance companies we contract with). Otherwise, the patient is on the hook for it. Our rates are kind of keyed off the Medi* rates. Even with that, the two townships we cover both kick in cash - kind of an "opportunity cost." They essentially pay to keep a paramedic in the house.
One hiccup we've encountered is where the insurance covers the bill, but sends the check to the patient, instead of the ambulance service. Far too many people seem to think that means a new flat screen TV, or they have other bills they need to pay.
We staff a paramedic 24/7, and on weekdays our director and/or ops director (both paramedics) are also available should a second, simultaneous, call come in. We try to staff the driver slot with a volunteer, but that's not always possible, so we end up paying them as well.
Our pay rates are on a par with other agencies in the area, but it's not unusual for medics (and EMTs) to work for several agencies so they can pay their bills.
My agency runs around 1,000 calls a year, with something over half resulting in an actual transport to the hospital. We also bill for "refusals," where the ambulance is called, but the patient decides they don't want to go. If there is no patient contact, there's no bill - stuff like assaults, suicidal person, etc., where law enforcement takes care of it. But there's still the fuel and wear and tear on the rig (which costs $120,000 or more).
It's a tough business.
tree68 Electroliner 1935 Does your board bill for calls? Yes, we do. And we're a not-for-profit. Unfortunately, we sometimes have to accept what the payer will pay (Medicare, Medicaid, insurance companies we contract with). Otherwise, the patient is on the hook for it. Our rates are kind of keyed off the Medi* rates. Even with that, the two townships we cover both kick in cash - kind of an "opportunity cost." They essentially pay to keep a paramedic in the house. One hiccup we've encountered is where the insurance covers the bill, but sends the check to the patient, instead of the ambulance service. Far too many people seem to think that means a new flat screen TV, or they have other bills they need to pay. We staff a paramedic 24/7, and on weekdays our director and/or ops director (both paramedics) are also available should a second, simultaneous, call come in. We try to staff the driver slot with a volunteer, but that's not always possible, so we end up paying them as well. Our pay rates are on a par with other agencies in the area, but it's not unusual for medics (and EMTs) to work for several agencies so they can pay their bills. My agency runs around 1,000 calls a year, with something over half resulting in an actual transport to the hospital. We also bill for "refusals," where the ambulance is called, but the patient decides they don't want to go. If there is no patient contact, there's no bill - stuff like assaults, suicidal person, etc., where law enforcement takes care of it. But there's still the fuel and wear and tear on the rig (which costs $120,000 or more). It's a tough business.
Electroliner 1935 Does your board bill for calls?
The Medical-Industrial Complex with Medicare and its payment policies raising the complexity to the Nth degree.
SD70Dude greyhounds SD70Dude You would never have risen to such a high position in a PSR railroad. The first and only goal is keeping the operating ratio low and keeping the shareholders happy. The easiest way to do this in the short term is to make cuts and not try anything new. Finance people don't need to understand the nature of their company's operations because their jobs have nothing to do with that, this also applies to HR. Their purpose is to cut costs and funnel money to the shareholders. That's it. If you can do that at one company, you can do it at any company Well, I didn’t rise to such an elevated position anywhere. But I strongly disagree with the idea that: “Finance people don’t need to understand the nature of their company’s operations.” I’ll use the example of Katie Farmer, the new BNSF CEO. The railroad spent decades developing her recognized innate talents and abilities. Evaluating her as she was moved to positions of ever-increasing responsibility in various departments. She worked in operations, marketing, and finance. Those departments, and others, all interact. And such interactions need to be understood by all those involved. This includes people well below the CEO level. Otherwise, there will be a sub-optimization of the company’s performance. A well-run company will move talented people into various departments so that they develop diverse experience and knowledge. In the end it must all come together well and that won’t happen if one department dominates to the extent that over all corporate performance is harmed. Does every company do this? Hell NO. But the best ones do. I do agree that “The Cult of the OR” got out of hand. Especially at the UP. "The Cult of the OR" was out of hand when it was first created. I get it, businesses need to be profitable and have an obligation to run efficiently, but obsessively focusing on improving one number was never a good idea, and runs directly against the idea of adding revenue to existing trains where you can. The finance people have been in the driver's seat for years, and there is precious little real-world experience in today's executive suites. I agree that all executives need to understand the fundamentals of the field in which their company operates, but that's not where the North American business world sits right now. We had a real good COO (Mike Cory) for a few years who had started out as a labourer on the shop floor in Transcona. He was moved around the company over the years as you described, mostly in various transportation and operations managment positions though he did also spend some time in customer service and marketing. I think he didn't last as COO because he kept spending money on silly things like double track and new locomotives, as well as adopting a more respectful approach to on-the-ground employee relations, all the Hunter-era harassment disappeared overnight after he was put in charge (it has slowly been coming back since he left). In his three years Cory did more for CN than every other executive of the last 20 years put together.
A company a friend works for reconditions large cylinders. As large as 177,000#. Their culture is imbued with safety first, quality second, productivity third. Top of the organization to bottom. They're very profitable. Too bad railways don't follow suit.
GrampA company a friend works for reconditions large cylinders. As large as 177,000#. Their culture is imbued with safety first, quality second, productivity third. Top of the organization to bottom. They're very profitable. Too bad railways don't follow suit.
I can see how safety could be a tradeoff with profit or productivity. But why should safety be a tradeoff with quality?
I would make quality & safety first; and profit & productivity second.
BaltACDThe Medical-Industrial Complex with Medicare and its payment policies raising the complexity to the Nth degree.
Ross Perot made his Billions off Medicare / Medicaid. First by selling IBM Mainframes to states to process Medicare, second by starting EDS and selling the same states computer programmers on a contractual basis to program Medicare on the mainframe. He understood the Federal Government was in way over it's head with the complexity of the Medicare program and would probably never be able to afford decent IT people via Government Salary. He was correct on both counts.
EuclidI would make quality & safety first; and profit & productivity second.
Agree totally and the last two follow the first. If you produce something of sufficient quality for a fair price it will sell itself via word of mouth and you will never hurt for business. All the Class I railroads should relearn that lesson. They understood it once. I am not so sure they understand it today. Though I am beginning to think CP is the closest to learning it again of all Class I's.
Twenty-six replies in a thread about TWO carloads of potatoes...
Backshop Twenty-six replies in a thread about TWO carloads of potatoes...
Better than zero loads...
People take the service your type of operations provide for granted and do not like paying for it until they need it. Then they complain about any delays and trivial things. You already know this. I worked for a utility, as long as the power was available, they would complain about bills and other issues. Let the lights go out and they want it back NOW. Thank you for what you do. I for one appreaciate volunteer and paid first responders. As the Mastercard ads used to say, "PRICELESS". Thank You.
until it is not available and
CMStPnP BaltACD The Medical-Industrial Complex with Medicare and its payment policies raising the complexity to the Nth degree. Ross Perot made his Billions off Medicare / Medicaid. First by selling IBM Mainframes to states to process Medicare, second by starting EDS and selling the same states computer programmers on a contractual basis to program Medicare on the mainframe. He understood the Federal Government was in way over it's head with the complexity of the Medicare program and would probably never be able to afford decent IT people via Government Salary. He was correct on both counts.
BaltACD The Medical-Industrial Complex with Medicare and its payment policies raising the complexity to the Nth degree.
I don't think anyone can make sense out of all the competing profit motives from all the parties involved in the medical-industrial complex.
This Summer I had issues with both my 'exhaust' systems. Issues with my bladder, one kidney and my regular 5 year colonoscopy. Medicare was billed in excess of $59K. Medicare 'approved' payments of over $21K, Medicare actually paid a little over $20K. My 'medicare supplement' policy paid out over $3K. To date my out of pocket payments have been less than $115.
How it all works is beyond my pay grade.
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