When a railroad needs more locomotives, who order's them? Also, who makes the decision to order more? Could you explain this process?
Thanks,
Justin
The road to to success is always under construction. _____________________________________________________________________________ When the going gets tough, the tough use duct tape.
Justin,
I assume you're asking about the Big Class 1 RR's? The locomotive purchasing decisions are made at a very high level by a Corporate Vice President (working in conjunction with a large staff).
As far as the purchasing process goes the RR looks at it's current motive power requirements (based on current and projected traffic levels) as well as the current operating and maintenance cost of the existing locomotive fleet. They analyze a number of factors including locomotive performance as well as the all-important fuel consumption figures..
I'm sure some of our fellow forum members who work in the railroad industry can give you a much more in -depth answer to this question...
"I Often Dream of Trains"-From the Album of the Same Name by Robyn Hitchcock
New locomotives are a major committment of cash flow. The process is on-going, all the time. The operating department is continually updating its future needs including predictions of regulatory requirements, traffic types, maintenance locations, reliability desires, and availability desires. The mechanical department takes those needs and projects forward versus predictions of technological improvements, prices, regulatory requirements, maintenance costs, labor agreements, and so forth. When there is a consensus that new locomotives are needed, and a consensus on what they should be, and the respective department heads have all signed off on a plan, then it's advanced to a least an executive committee level. Again, this is an ongoing process, so usually on at least a quarterly basis the executive committee is updated on future motive power needs and what the long-range plan looks like. Meanwhile, discussions with the manufacturers are ongoing, virtually constantly, on what future locomotive possibilities are. When the executive committee agrees that it's time to open negotiations with the manufacturers, they're invited to submit formal proposals. Then the proposals are negotiated. When everyone agrees on terms and conditions -- and the railroad's need hasn't in the meantime changed -- then an order is given to the purchasing department to execute.
In short, this is constant, on-going process, with lots of people involved from operating, mechanical, legal, purchasing, labor relations, engineering, and signal.
RWM
(Is the beancounter actually listening to the other supervisors, or has he been cowed to be driven soley by the balance sheet?)
Thanks all who responded. So it's not just the operating department who makes the decision. I see. Thanks for clearing that up for me!
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