Federated and May co. Department merger bad news for Railroads

[Anonymous]

http://story.news.yahoo.com/news?tmpl=story&cid=1802&e=3&u=/washpost/20050301/ts_washpost/a61240_2005feb28

The Merger of these two retail giants will mean that will have more bargining clout with regard to intermodal rates. This could put one of the railroads deep in the hole.

[kevarc]

NO. Right now, no one is going to get a lower rate. UP is publishing their rates and telling folks to take it or find another shipper. They are not wanting contract that are more than a year and it is at the published rate.

[AntonioFP45]

Haven't railroads "flexed" before?

This may become a "short" but interesting chess match. It's always a game in big business.

[BaltACD]

Rates are always in a state of flux.

Both parties to the rates 'flex their muscles' and come to an agreement that both parties can live with. The days of the 'common carrier' rates are long gone.

[CSSHEGEWISCH]

I don't think that either firm is a major rail shipper (if they even ship by rail) so I don't think that any railroad's marketing department is particularly worried about this merger.

[spbed]

I would suspect that a department store is much into Intermodal then boxcar so I doubt if it will have any effect on the RRs.

[kevarc]

And ocnsider it is usually the shipper, not the reviever that determines shipping method.

[Anonymous]

The Department stores have huge warehouses where there have logistics planners who dicate how products will get shipped to them. Intermodal plays a huge part in moving stuff expacialy around Christmas time.

[spbed]

Maybe depends on the terms but what I was more referring to is a department store is not likely to have bulk items such as woodpulp or chemicals shipped to them. That is the reason I believe they would be more into intermodal or truck for that matter. [:D]

QUOTE: Originally posted by kevarc

And ocnsider it is usually the shipper, not the reviever that determines shipping method.

[CSSHEGEWISCH]

When intermodal is used, the railroad often is more of a transportation wholesaler who deals with the trucking company, who in turn deals directly with the shipper. If I ship a package by UPS to Los Angeles, I only deal with UPS, not BNSF.

[spbed]

Yes I am aware of what you are saying as I used to work in the stemaship industry & on a daily bases deal I dealt with the rail consolidaters, UPS & even the USPS. I think sorry to say our thoughts are going in different directions on this thread. [:o)]

QUOTE: Originally posted by CSSHEGEWISCH

When intermodal is used, the railroad often is more of a transportation wholesaler who deals with the trucking company, who in turn deals directly with the shipper. If I ship a package by UPS to Los Angeles, I only deal with UPS, not BNSF.