The Railroads are Dying

[Anonymous]

I think a few people appropriately understood my original post and a few jumped to a conclusion based on the subject line.

If you go back and read my original postIn my original post at the top of the thread, I mentioned that I spend time educating my new colleagues about the fact the RR's are not dying, contrary to what many people would believe. I subscribe to the AAR stats publications and watch the freight gradually growing all of the time.

I also mentioned above that the RR's have retrenched to a more viable core-route network. I think its a strategy that has paid significant dividends for them. To that end, thank God for intermodal being their outreach tool.

I guess in selecting the subject line for this post, I was trying to employ an old journalism trick to get interest in the topic: Make the headline sensational and they'll read it.

However, I'm continually dismayed and frustrated with perception by the general public and the shipping public about the rail industry. Too commonly, either the public has no data from which to form an opinion, or their opinion is negative. I rely on RR's for not only a hobby, but also for my livelihood. I'm in sort of an intermediary function and there are a huge lot of shippers who are VERY, VERY skeptical of RR's and the railroads, as an instituion have done virtually nothing to show that they're viable. I know that there are a lot of hard working men and women who give it their all every day to try to make it work... and often do.

Many larger, sophisticated shippers accept rail transit as a price-buy and as a simple economic reality. Many would rather truck it, if the economics were more favorable. Trade offs in everything I guess - service, speed and reliability vs. price.

At times, the RR's can often be their own worst enemy. Try getting a box car rate that internlines between two RR's... or God forbid, crosses an international border. The web application, of course, can't provide this rate. There's no actual number to call to speak to a live person. So you fish around the organization. Eventually you stumble on the right person but seldom if ever, in fact thus far, never actually find them at their desk, answering their phone. So you wait and wait and wait for a reply. I've been working on one rate for two weeks and now, some 15 calls later, I'm still waiting for part of the response. The preliminary numbers that I have would say this will be a greater than $2M revenue opportunity, but I can't get a reply phone call.

What would you say about a carrier that consistantly provides service at 30-60% on time..... but of course, expects to be 100% of the rate, 100% of the time? There was a time when the RR's published schedules for more than propaganda sake. They actually meant something. There are still 2 big US carriers who get it, but there are 2 who are soooo far out of the game, its just sad. Trains magazine columnists would say that market economics will sort this out. Not when the network has been so thoroughly consolidated that there isn't a 2nd choice of RR's for several hundred miles.

Maybe they are dying and we just can't all smell the decay just yet. [xx(]

[jeaton]

dblstack- I'm pretty sure I got your point and though I have been away from the business for about 15 years, I think I know part of the story. When I started in the business of transportation pricing, the Interstate Commerce Act had a pretty tight hold on what the rates could be, and also how the rates were to be published. If you are able to look at any of the rate publications-tariffs-you would see that they were extremely voluminous with a lot of what, where, when and how much verbiage to define the charge for any given shipment. (Much like the way I tend to write). It was so complex that there were specialty business schools to teach people how to read them. It was common for many in the business to work a few years in the rate (pricing) department of a railroad and then get a job as a traffic manager (transportation buyer) for a shipper. Shipping companies needed this kind of expertise to get there goods moved. After the Staggers Act for railroads and laws for other modes "deregulated" the transportation industry, the function of buying transportation often went to the shipping department. Truck line reps had always gone around to the dock, because if a company was shipping by truck, there wasn't much, if any, difference in rates for any given product being shipped. Meanwhile, rail reps no longer had an old friend to call on, without the help of the Traffic Manager and his knowledge of how to ship by rail, there tended to be an attitude of "I don't to be bothered with all the complexities. I just want to get the freight out the door." At the same time the railroads made significant reductions in their sales force, and ultimately, there became what I would call a loss in the body of knowledge. I once did some estimating on this and figured that there may have been job reductions in the high tens of thousands. From the general view of business productivity this may not have been bad, but I think it is clearly a factor the attitudes you now find in the group you define as the shipping public.

Compared to the time and effort it took in the old days to get rates set and effective, (they even had to be published in the tariffs for 30 days before they could be used), I am amazed that there now are railroads ill equipped to get a price out promptly.

As I said before, unless there is a desire to change public policy, I don't think there is much need to "educate" the general public. But to blow off customers? That's dumb!

[jeaton]

PS:Any chance that the two railroads out of the game also have the highest paid CEO's. E-Mail me back that one if you want.

[Anonymous]

Oh, no, not another "the sky is falling" thread. Guys, the railroads will be here for a long time to come. I used to work with a crusty old head conductoir who loved to tell us how when he first hired out in the late 1940s people were saying the railroads were on their way out and that with the war over and rationing done cars, trucks, busses and airplanes would be the future of transportation. He always liked to sigh, and give us a wink and say, "the missus was sure counting on the railroad being gone so I could be home ALL the time. Thank god for the railroad boys, may she always run." Here's to ya Jack, hope ya make last call at that Golden Spike Bar two down from Heaven's Roundhouse.

LC

[ironhorseman]

QUOTE: Originally posted by dblstack

Here's one to ponder.......If you asked 10 people on the street how the railroads are doing, I would bet that 8 or 9 would say that they're dying, they're a non-issue in America. Who uses them? What do they haul? The remaining one or two would have no data to even offer that much of an opinion. Does that prospect concern anybody?

I work in transportation and when newly-hired people sit in with me for orientation (since I'm the RR guy), a lot of them sheepishly ask, "Um, are the railroads still a viable way to move freight?" These are educated people who are starting a career in transportation.

I think a lot of this outlook that the RR's are on the way under is based on people seeing the branch line in their hometown being torn up and being made into a bike trail. People don't realize how the RR's have sort of mimicked the interstate highway system (their supposed nemesis) and have retrenched largely to a high-volume, hub-to-hub, corridor focused system (i.e. many fewer lanes, but more capacity and more trains in those lanes.) The average person has no idea about that. They've never seen the triple track at North Platte or Logan Hill in the Powder River Basin. They don't know about the BNSF Double-Track Transcon Main. They have no idea what it means that CTC was added to a line or sidings were added or lengthened. They just know what they see, which, with regard to RR's, frankly isn't much for most folks. The trains that they do see just appear as random things. No real rhyme or reason to them. No pattern. No big picture.

Do the RR's care that this perception exists. I've directly heard Sr. Execs from BNSF, NS, CSX & CN say no. When asked if this bothers them, they said that they wouldn't support any advertising to change this perception.

Did the Union Pacific "Building America" campaign do any good with regard to this issue. Well, it was flashy. It had some nice landscape shots. It even won some awards, but really, when you boil it all down, what did it say? "We're still in business!" Not much more than that, did it?

I've had stunned looks when I tell people that in the last 10-15 years, the RR's have moved more tons of freight, more miles than at any time in history (even more than during WW II.) They don't believe it. They just say "You're kidding, right?"

The RR's are satisfied to toil in obscurity. Maybe that's why they have such a hard time getting support for things like regional transit, Amtrak, public-private funding for infrastructure (i.e. intermodal ramps, grade crossing projects, etc.)

I guess if the majority of folks thought that my business was dying, I'd be concerned. I don't think that the RR's are. I've seen no showing of concern. Maybe that's just their arrogance. Would it bother you?[?]

I don't think it's anything to be concerned about and I wouldn't worry over it. I'd say So What? The railroads are doing fine and making a profit. I've come to find out over time that a majority of people are ignorant and apathetic. They don't know what goes on in the world and they don't care. They just don't pay attention. They don't watch the news or read newspapers. They get up, go to work, come home and find someway to be entertained. Most people don't listen to the radio anymore. When they get in their car they put in a CD. Most people are watching DVDs, videos, or cable TV. Then they get mad when a tornado comes through town and they weren't warned. Well, if they had been paying attention to the weather and turned off their tapes and turn on the local TV station or radio they'd know what the weather is going to be and what's going on in the world.

When I tell people of my rides on Amtrak they're first reaction is to get wide eyed and say "wait wait wait, stop, back up--- there are still PASSENGER trains?!?!?" People get aggravated at trains because it makes them late for work. People spend all this time and effort in trying to get to work or class or the store on time, but once they get to their destination they're not there 5 minutes before they're already thinking about leaving and how soon they can get off or how many breaks they can take in the next 30 minutes.

But that doesn't bother me except in the case when I have to work with such people because they're never focused on the task at hand. They get so distracted about what they're going to do later and not what they're doing now. It's all about going to a club or a party or constantly being on the phone because they can't stand where they are now so they need to be in touch with someone who is not where they are now.

We spend our days filling our minds with trains and consuming railroad data and there are some train enthusiaists who get surprised and upset when other railfans or non-railfans don't know what an SD40-2 is or who makes it or how old it is. It's just like baseball stats: not everybody follows baseball and not everybody who watches baseball doesn't know the career stats of every player.

I don't care that people don't care about trains. Trains are MY hobby, they are MY interest, I don't care that the "average man on the street" doesn't know the first thing about trains and I don't expect him to. And it really doesn't matter either. It doesn't affect anything. There are too many people out there that don't care a lick about anything, all they know is the universe revolves around them and there is nothing I can do to change their minds or thinking. You can't force someone to care about or educate themselves about something they have no desire to get involved in.

[ironhorseman]

QUOTE: Originally posted by andyjay

I've never met any teenager or college-age person who's expressed any interests in working a steam engine.

You haven't met me. I've always wanted to drive a steam engine, and not just as one time deal either. But an engineer is someone with tenure and experience. If you get hired to work on a railroad your not put in their engineer's seat on an over-the-road freight frist thing. You have to work your way up to that spot. I'm in my 20s and even us 20-year-olds will someday be driving the steam engines, some day, when we're past middle age probably. There wil always be someone out there to fill the shoes of those steam engineers who past on.