Hi Greyhounds. Thanks for your comments. I agree with you all around. Related to RoadRailers, I think it would have been intriguing if BNSF had been successful in merging with NS which, as I mentioned in the book, was part of our BN Intermodal vision post the ATSF combination and which Rob Krebs then attempted. That would have opened that "black hole" of 300-500 miles on either side of the Mississippi (and former IC) to single line service (with a unified income statement and balance sheet and fewer "zero sum game" challenges) and therefore a lot of 700-900 mile Triple Crown hauls between decent markets that motor carriers still dominate. Those are tough markets for double stack in that you typically need more line-haul miles to spread higher terminal costs over to be attractive profit-wise. Given your experiences, you are probably in a better position to judge than me.
Your comments about railroad per-shipment costing are spot-on. BN's Expediters were initiated for several reasons I laid out in the book but especially to fill excess capacity. They contributed to fixed cost coverage in a situation where there was excess capacity. On the other hand, BN was tied up in excess pricing litigation with McCarty Farms and, as that case went through the process, rulings went both ways until the Court finally said (an incredible 18 years after litigation started) BN's pricing practices were legal. It ultimately was really a case about how overhead/fixed costs were allocated. BN's coal case litigations had a similar underlying dilemma at their core. As I mentioned in the book, appeal decisions flip-flopped as the cases progressed through the process so even the regulators/courts struggled with the issue. You pointed out another classic case of faulty overhead cost allocation logic related to the Texas Intermodal market withdrawal. Those who ultimately judged and controlled BN's locomotives simply did not understand managerial economics in a high fixed cost/high shared fixed asset environment. Being stuck in a financial accounting mindset really harmed customers, employees and shareholders. I think these are great lessons that a lot can be learned from.
Thanks for the e-book comment. I toyed with an e-format for Against All Odds but I was concerned that so many charts and tables made a hard copy format better as it is easier to page back and forth (including to and from appendices in different volumes) when one wants to compare stuff. I never originally intended for the work to be more than 1,100 pages.
Thanks again!
MSC, all three voulumes were great.
I worked in intermodal market development and pricing for the ICG. Some situations you encountered seemed quite familiar. Later I worked for RoadRailer. Your writing about BN trying to find a place to use RoadRailers was interesting. I'd say RoadRailers were a solution looking for a problem to solve.
To me, the most salient problem you focus on is the inability of a railroad to accuratly determine the cost of moving a load of freight. I believe that inability, combined with the insistance of alocating fixed cost, is a major factor in limiting rail market development. One time I was going through some "Costing" and I came across a line for "Fixed costs per gross ton mile." I just sat there and stared at the words. It just confirmed my knowledge that my railroad was a zombie.
Your Texas service issues would make a good case study in MBA schools.
I'm glad you are going to write some more. Would you please consider making your books available as ebooks.
Hi SD60MAC. After what I went through to write what felt like a "War and Peace" version of BN and BN Intermodal history, I vowed it would be one and done. The more I have thought about how much of the rich "inside perspective" history of the railroad industry is undocumented, and how those memories are quickly being lost forever, I have reconsidered. I am working with Trains Magazine, the UP Historical Society and perhaps another entity on articles related to some of my Amtrak experiences. I have also been asked by former BN colleagues to try to document the story of the phenomenal turnaround of BN's grain business that I had some first-hand experience with so I have started work on that.
BTW, Birmingham was a big part of BN's Intermodal history. Our hub manager there, motor carrier veteran Earle Cochran, was really the one who created the model that made our vison of highway satellites a reality in order to extend our geographic reach. A few of us renagade railroaders had the vision but we didn't know how to make it a reality. Earle made it happen on a relatively large scale, as is mentioned in the book.
One thing among many I did not mention in the book was that BN looked hard at selling or shortlining lines east of Memphis (including Brimingham). One of the obstacles was an old Frisco bond that had restrictive indentures like the old JP Morgan inspired NP bonds I wrote about in the book that held back BN's ability to exploit its land/resource riches.
MSC Hello Forum. I am the author and wanted to thank all of you for your interest in the work. I wasn't aware this forum existed until Ed tipped me off.
Hello Forum. I am the author and wanted to thank all of you for your interest in the work. I wasn't aware this forum existed until Ed tipped me off.
Welcome to the forum Mark! An thank you again for publishing the story of BN's IBU. It's especially helpful for a millennial like myself who only read about BN in Trains Mag as a child, and saw BN for a few years of its remaining existence. Brimingham AL, of all places... On road trips down to Mississippi, and Louisiana, to visit family.
Do you plan on writing any more publications about BN?
There were a couple of questions posed that I am happy to answer. The "Against All Odds" title refers to the fact that BN's Intermodal business was essentially an "illegitimate child" within the company who wanted to primarily focus investments on coal after the original 1970 BN merger, then investments in oil and gas after the holding company was formed in 1981, and then mostly for coal and grain within the rail business after that until the BNSF merger in 1995. It was kind of like trying to pull teeth from a hen to get money for Intermodal. Given how important/essential Intermodal is to the business today, it is hard to fathom that it was the runt of the litter within BN. Most of the greatest impediments were internal which make it even more of an "Against All Odds" story. I think those who read it will agree when they become aware of the facts.
References to "before it is too late" refer to the fact that we are rapidly losing institutional memory for a business from the 1970s-1990s. I wrote the book as a tribute to my former team members who essentially made a miracle happen given all of the obstacles that were overcome. One of the most prominent team mates was Bill Greenwood who was the original IBU leader. He dearly wanted the story written and convinced me to do it with an offer of any support he could provide. I found a treasure trove of documents in his attic which he graciously donated to the Barriger National Railroad Library. Resources such as those plus the documents my former Santa Fe contemporary Don McInnes donated to the Barriger were a blessing. Couple that material with the memories I was able to document from Bill (I spent countless hours talking with him which seemed to invigorate him when he was having really bad days health-wise), Darius Gaskins, Rob Krebs, Don McInnes, and scores of other former co-workers and former business associates and there was enough material to record a remarkable history for posterity. I think it is a relatively unique business history work given its depth and breadth, point of view, and the number of citations (2,300+) to back up what is stated which hopefully gives it credibility.
I was fortunately able to complete it before Bill died and I will never forget how full of joy he was when he held and paged through the volumes. It was a real race to get it done in time because Bill's health was failing fast. That is a reason the editing and indexing are not as good as I would have liked, especially in Volume III. Bill passed away in September so it was a worthwhile tradeoff.
Thank you again. I would be happy to attempt to answer questions forum members may have.
Looking forward to the day after Christmas to begin V2.
Glad you liked it.
Ed
I ordered all 3 volumes. They arrived yesterday via Amazon. I opened the package ASAP! Cracked open Vol. 1. Buried my head in the book for about 3H, or so I'm at page 190. Agree with your consensus MP173!
Amazon says Volume 2 will be on my doorstep tomorrow. Yes, on Sunday.
Tree:I understand that. What makes listening/watching on computer webcams (and scanner chatter) is the challenges presented to dispatchers and operating crews to balance the hot trains (UPS!) with the daily operations. The author briefly addresses that in discussions of the proposed intermodal service with ATSF over Avard, Ok. ATSF was (is?) a class 5 operation which allowed for 90mph passenger and 79mph freight.
One interesting win for BN was extending their intermodal market to Detroit with a run thru train with GTW. I recall that train thru town, I believe it was GTW 205 and the one time it was viewed it had a single BN motor. Those interline success stories were few and quite rare.
I am looking forward to V2 and V3...rumor has it that it will be a Christmas present.
tree68 greyhounds When Harrison came to the IC he cut the Chicago-Memphis intermodal schdule to 12 hours. Before Harrison the operating "management" complained that they just couldn't do it in 15 1/2 hours. Not reading the book (for now, anyhow), but I'd opine that while it's physically possible to make the trip in X hours, the disruption to other traffic would be problematic. Much like you see with Amtrak even today. The "halo" around Amtrak trains is discernable on a two-track main. A single track main would be far worse. And in the PSR world of insane length trains, finding a place to hide them while the hot intermodal passes would cause chaos.
greyhounds When Harrison came to the IC he cut the Chicago-Memphis intermodal schdule to 12 hours. Before Harrison the operating "management" complained that they just couldn't do it in 15 1/2 hours.
Not reading the book (for now, anyhow), but I'd opine that while it's physically possible to make the trip in X hours, the disruption to other traffic would be problematic. Much like you see with Amtrak even today.
The "halo" around Amtrak trains is discernable on a two-track main. A single track main would be far worse. And in the PSR world of insane length trains, finding a place to hide them while the hot intermodal passes would cause chaos.
Most people don't understand how big of a 'foot print' a train has on the railroad and what is required for that train to have clear signals in its journey across a route. A track segment is occupied no matter if it is light engines or a 14K foot train and appropriate signals will get displayed behind it.
Never too old to have a happy childhood!
greyhoundsWhen Harrison came to the IC he cut the Chicago-Memphis intermodal schdule to 12 hours. Before Harrison the operating "management" complained that they just couldn't do it in 15 1/2 hours.
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 have not finished V1, but I'm getting there.
When Harrison came to the IC he cut the Chicago-Memphis intermodal schdule to 12 hours. Before Harrison the operating "management" complained that they just couldn't do it in 15 1/2 hours.
Greyhound:Have you finished V1? I just did today. The author covers quite well the spin off of the "Resources" group from the railroad and how the railroad was saddled with considerable debt. It doesnt seem like the railroad had very good investment banking advise.
I was a bit surprised also by the Chicago - Memphis Expediter service. I do not recall any publication (Trains) covering that service. That would have been quite a roundabout route to Memphis. According to 1988 Official Guide, the BN route from Cicero to Memphis was 672 miles...Cicero to Galesburg to West Quincy to St. Louis to Memphis. I dont think the West Quincy to St. Louis was a high speed operation, nor the old Frisco line linking St. Louis to Memphis.
Compare to the Illinois Central, Mainline of Mid America which shows as 526 miles. Further, the 1988 OG shows IC had a scheduled intermodal departing at 1830 and arriving Memphis the next morning at 1000...average of 34mph.
If BN was actually making progress on a route which was 146 miles longer and probably tougher operations (going thru St. Louis had to be difficult), then it had to have resulted from marketing and sales. Nothing else.
Other gems in the book (there are many) include E. Hunter Harrison - quite the hero to the Intermodal folks, but he wore out his welcome in the late 80s (read the book to find out why). I have said it before, but this is as much a history of the BN as it is the Intermodal Business Unit.
MP173he inside information in this book is nothing short of amazing. Ed
Yes, it certainly is.
It’s also often painfully familiar.
The problems with the operating department.
Trying to work with the unions in order to make shorter rail intermodal hauls truck competitive. Sometimes meeting with success and other times meeting with intransigence.
The “Black Hole” in the Midwest caused by the east-west divide of the US rail network.
The realization that door-to-door service was needed in lieu of terminal to terminal rail service.
The issues mitigating against door-to-door service.
It's all there. And more. And it’s explained.
The biggest surprise for me was that BN set up Chicago-Memphis Expediter service in competition with the ICG. The author says they found a lot of freight for it. I was gone from the ICG when that happened.
There is a very interesting chart showing how Kellogg shifted from rail to truck over a four year period.
The books are printed on demand. That will not delay the delivery.
Inside the back cover of the book I am reading it has the date printed and location. This book was printed Oct 7 in Mokena, Il. It was available at the library (I ordered it) on October 12th. That is fast. Printed and distributed by Amazon.
As mentioned above V2 and V3 are available.
I am currently in 1987. Will finish that chapter tonight. So far in 1987 the author covers a number of intermodal developments, including ongoing negotiations with Santa Fe (including documents) that would have opened the interchange at Avard, Ok for intermodal marketing to Memphis and St. Louis. Santa Fe would have controlled all marketing and pricing to those points with BN handling the line haul plus the intermodal terminal facilities in both cities.
In other words, BN opened up two significant markets for Santa Fe which would have controlled the marketing/pricing in return for BN to fill capacity on the old Frisco line...woefully under-utilized. Already one can see the shift occuring as BN has moved past the old regulated days and are looking for asset utilization at signicantly lower revenue.
The author indicates the Frisco merger was viewed as a big mistake and was executed due to personal relationships between CEO's at the time (mid 70s). While the Kansas City-Birmingham line opened up nice coal markets in the Southeast, the non-consideration of MoPac as a merger partner would haunt BN for years. the inside information in this book is nothing short of amazing.
BH Class B shareholder here...........go BNSF, go!!! Also own UP and CPKC.
croteaudd When are Volumes II and III scheduled to be released?
When are Volumes II and III scheduled to be released?
All three volumes are currently available on Amazon.
https://www.amazon.com/Against-All-Odds-Burlington-Innovative/dp/B0C9SB2JKB
I've definitely got to get this book!
Backshop I know that most Morning Sun books only have print runs of 500-2000 copies. I wonder what the print run of a book like this would be?
I know that most Morning Sun books only have print runs of 500-2000 copies. I wonder what the print run of a book like this would be?
Years ago I developed a formula.
W=K*E (wisdom = knowledge * experience).
Later I modified it to W=K*E (squared). It became obvious that experience needed to be squared. Sometimes things look great on paper, not so well in the real world.
BaltACD:
Your ‘51+ years’ post above was marvelous! From it all can see your great depth of wisdom, understanding, and knowledge. It really was a gem of a post! Thanks for replying that way!
croteauddBaltACD: Close to thirty-five years ago an imaginative new President of a Class 1 railroad famously reduced employees without the extreme pain of doing so. It just was a commonsense approach instead of the typical viciousness. Even my father-in-law took advantage of its wondrousness! So, such great things are possible! That railroad president not long afterward resigned because the parent company was scaling back and the future looked bleak for him. But another First Class railroad was so impressed with him and his imagination that they hired him and made him its Chairman, CEO, and President! And he went on to do absolutely great things for that company!
Close to thirty-five years ago an imaginative new President of a Class 1 railroad famously reduced employees without the extreme pain of doing so. It just was a commonsense approach instead of the typical viciousness. Even my father-in-law took advantage of its wondrousness! So, such great things are possible!
That railroad president not long afterward resigned because the parent company was scaling back and the future looked bleak for him. But another First Class railroad was so impressed with him and his imagination that they hired him and made him its Chairman, CEO, and President! And he went on to do absolutely great things for that company!
As a 51+ year employee of the B&O, Chessie System and CSX - I went through more 'buy out' force reductions than I care to count. My observations were that those that rose to 'power' because their former superiors took the buy outs, repeated the mistakes that their predcessors made. Experience is a fierce teacher, but those lessons walk out the door when the institutional knowledge of those that had those hard lessons taught to them walk out the door.
Ideas and Plans rarely survive intact after they experience their first battles with reality. As that noted philosopher Mike Tyson [/sarcasm] says every plan changes when you get your first punch to the face.
Somebody here is a great fan of "I know something that you don't know" without realizing that we don't really care.
croteaudd Labor … There is a magical way to get one man crews fast! (Though I question the practicality of one man crews, such as use of the cab restroom.) But managements invariably take the hate route and suffer war as a consequence.
Labor … There is a magical way to get one man crews fast! (Though I question the practicality of one man crews, such as use of the cab restroom.) But managements invariably take the hate route and suffer war as a consequence.
One-man crews are getting a lot of pushback from sources other than organized labor. A variation on full-crew laws is the latest approach.
croteauddMP173 (Ed): It is hoped that your readings of the book series ‘Against All Odds” are rewarding! Decades ago, I tried to get railroad managements to think differently about yards, operations, and labor, and if they had done so they would have made much, much more money, But, to no avail. Example, yards. My philosophy is to keep railcars to be sorted moving! It once took me about four seconds to draw for a patent attorney a new type of yard, and after looking at it for just two seconds, he exclaimed, “There is money in this!” But I knew something he didn’t … Labor … There is a magical way to get one man crews fast! (Though I question the practicality of one man crews, such as use of the cab restroom.) But managements invariably take the hate route and suffer war as a consequence. The purpose of mentioning the above is for you, MP173, to compare the difficulty or magical ease of implementing new ideas in your reading of the ‘Against All Odds’ book series. Happy reading!
It is hoped that your readings of the book series ‘Against All Odds” are rewarding!
Decades ago, I tried to get railroad managements to think differently about yards, operations, and labor, and if they had done so they would have made much, much more money, But, to no avail.
Example, yards. My philosophy is to keep railcars to be sorted moving! It once took me about four seconds to draw for a patent attorney a new type of yard, and after looking at it for just two seconds, he exclaimed, “There is money in this!” But I knew something he didn’t …
The purpose of mentioning the above is for you, MP173, to compare the difficulty or magical ease of implementing new ideas in your reading of the ‘Against All Odds’ book series.
Happy reading!
Did you present the 400 MPG fuel delivery device to the auto makers too?
MP173 (Ed):
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