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Toughest Challenge for Railroads in Coming Years ?

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Posted by Railway Man on Thursday, December 24, 2009 12:41 AM

blownout cylinder

Railway Man
If you want to know what railroads can and cannot do, or can and cannot afford, please ask.

What can any RR afford? What terms are we going on--over a 10 year period say? For example what is the ratio of capital projects to overall revenue that we are looking at? And how is that usually arrived at?

 

 

If a railroad is spending its own money, it can afford what provides enough return on investment to meet the needs of its investors.  That's all.  Each railroad has its own revenue target and ROI target.  Look at their 10-K.

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Posted by BT CPSO 266 on Wednesday, December 23, 2009 10:14 PM

I did not think that this was going into a political discussion. Bucyrus simply asked to elaborate on my main points I stated so long ago. He wasn't asking me to change my option. If anyone else wants me to clarify on any of my statements; I will be more than happy to explain my views, or go into further discussion on what I have said. I think this is a good clean discussion on what all of us in the rail community think the larges challenges facing the industry are and how to secure it's future.

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Posted by Anonymous on Wednesday, December 23, 2009 6:24 PM

BT CPSO 266
Bucyrus

BT CPSO 266

If railroads need new infrastructure, why should they ask congress for it?
 
What is the purpose of educating the public about the importance of railroads?
 
Why does industry need encouragement to move their warehouses closer to rail, and how would you encourage it do so?

 

Well I think congress are the people to go to for money related to infrastructure. I mean think about it; the federal government pays for the trucking industry's infrastructure, why can't congress help out the railroads a bit by investing some money into increasing capacity and upgrading railroad routes to meet future needs that the railroads can't afford themselves fast enough to meet capacity needs.The railroads take care of themselves but don't have the money to invest in so much that needs to be done to meet the countries future economic needs.

Most of the the nation's rail network is not built for 70-80 mph intermodal trains and their are slower coal, grain, and manifest trains slowing them down too. Plus even the short lines have slow speeds because the track isn't built for heavier & longer trains. More industries would use rail if it provide faster service.

Encouraging businesses to move warehouses & distribution centers closer to terminals is pretty much explained in a recent issue of Trains magazine. I can't find it right now but it mentioned how big an issue the distance a truck has to travel between the terminal and the business. The closer the origin/destination is to the terminal; the better the chance rail will be a viable option.

 

As far as what I said about the the re-education of America, I'am talking about giving railroads a mention in school textbooks; acknowledged that trucks and planes aren't they only ones bring their stuff. May have speackers from the freight railroads and Dept of Transportation or FRA go around to speak to communities or hand out brochures or any informative materiel about RR's present in present day and future role in society.

Even have a NBC Dateline special on the industry or have CNBC do a special on the industry. They done specials on not just industries but individual companies like Walmart, American Airlines, GM... How about Union Pacific's success story; through their ups and downs or even BNSF since it's gotten a lot of attention recently. Most people were is shock that someone actually bought a railroad; maybe this is the time to tell people why RR's are an good investment in our future.

Thank you for your clear spoken answers BT CPSO 266.  I will think about them and see if I can come up with some comments.  I have to be careful though, because this does get into public policy, and that is considered to be political on the forum.  I know which article you are referring to in Trains that discussed the truck/train terminal interface.  That was the article, WIRED UP by Scott  Lothes.  It was a highly political article. 

Here it is:  http://www.railsolution.org/uploads/PDF/TRAINSarticle11-09.pdf

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Posted by BT CPSO 266 on Wednesday, December 23, 2009 5:59 PM
Bucyrus

BT CPSO 266

If railroads need new infrastructure, why should they ask congress for it?
 
What is the purpose of educating the public about the importance of railroads?
 
Why does industry need encouragement to move their warehouses closer to rail, and how would you encourage it do so?

 

Well I think congress are the people to go to for money related to infrastructure. I mean think about it; the federal government pays for the trucking industry's infrastructure, why can't congress help out the railroads a bit by investing some money into increasing capacity and upgrading railroad routes to meet future needs that the railroads can't afford themselves fast enough to meet capacity needs.The railroads take care of themselves but don't have the money to invest in so much that needs to be done to meet the countries future economic needs.

Most of the the nation's rail network is not built for 70-80 mph intermodal trains and their are slower coal, grain, and manifest trains slowing them down too. Plus even the short lines have slow speeds because the track isn't built for heavier & longer trains. More industries would use rail if it provide faster service.

Encouraging businesses to move warehouses & distribution centers closer to terminals is pretty much explained in a recent issue of Trains magazine. I can't find it right now but it mentioned how big an issue the distance a truck has to travel between the terminal and the business. The closer the origin/destination is to the terminal; the better the chance rail will be a viable option.

 

As far as what I said about the the re-education of America, I'am talking about giving railroads a mention in school textbooks; acknowledged that trucks and planes aren't they only ones bring their stuff. May have speackers from the freight railroads and Dept of Transportation or FRA go around to speak to communities or hand out brochures or any informative materiel about RR's present in present day and future role in society.

Even have a NBC Dateline special on the industry or have CNBC do a special on the industry. They done specials on not just industries but individual companies like Walmart, American Airlines, GM... How about Union Pacific's success story; through their ups and downs or even BNSF since it's gotten a lot of attention recently. Most people were is shock that someone actually bought a railroad; maybe this is the time to tell people why RR's are an good investment in our future.

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Posted by schlimm on Wednesday, December 23, 2009 5:48 PM

Bucyrus
The part of the public that is uneducated about railroads is not the rail customer, so what is the point of spending money to educate that public?  What changes when the public becomes highly educated about railroads? 
 
I also wondered how he would encourage industry to move their warehouses closer to rail.  I would think that industry would already know enough to have their warehouses as close to rail as they need them to be.  How would industry benefit from moving their warehoused closer to rail if they have already determined that rail service is not what they need?

 

You say you see no connection?  Look harder.  I agree with blownout cylinder that there is no point in trying to change your mind. 

Perhaps it would be better if return to Paul's original question which was "What is the toughest challenge?"   Let folks propose what they think are the challenges without criticism, like folks do in a "brainstorming session."

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Posted by Anonymous on Wednesday, December 23, 2009 5:31 PM

schlimm

 Bucyrus:  Everyone else can see the utility in a discussion with proposals.  For the most part, you just say no or answer with sarcasm.  The responses you did give suggest you see no need for expansion of the customer base.  I guess for you, the status quo is sufficient.

What makes you think I am against expanding the customer base?  I do not see the connection between what I said and meant and what you have concluded I meant.  Please explain.

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Posted by Anonymous on Wednesday, December 23, 2009 5:25 PM

Railway Man

These are public policy questions, not railroad questions. 

RWM

I don’t know which questions you are referring to, but the three questions that I asked on the previous page, and that have inspired further discussion on this page are not public policy questions. 

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Posted by blownout cylinder on Wednesday, December 23, 2009 5:03 PM

schlimm

 Bucyrus:  Everyone else can see the utility in a discussion with proposals.  For the most part, you just say no or answer with sarcasm.  The responses you did give suggest you see no need for expansion of the customer base.  I guess for you, the status quo is sufficient.

And if this be so then why do you insist on getting him to change his opinion? I do see some utility in these things but I'm not going to try to change someone's opinion --- ends up sounding like we are here to convert people. ConfusedWhistling

I do think that the challenges will get dealt with as they come up. Generally that has always been the case. That is what occurs when you have good problem solvers aroundSmile 

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Posted by schlimm on Wednesday, December 23, 2009 4:45 PM

 Bucyrus:  Everyone else can see the utility in a discussion with proposals.  For the most part, you just say no or answer with sarcasm.  The responses you did give suggest you see no need for expansion of the customer base.  I guess for you, the status quo is sufficient.

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Posted by blownout cylinder on Wednesday, December 23, 2009 4:29 PM

Railway Man
If you want to know what railroads can and cannot do, or can and cannot afford, please ask.

What can any RR afford? What terms are we going on--over a 10 year period say? For example what is the ratio of capital projects to overall revenue that we are looking at? And how is that usually arrived at?

 

Any argument carried far enough will end up in Semantics--Hartz's law of rhetoric Emerald. Leemer and Southern The route of the Sceptre Express Barry

I just started my blog site...more stuff to come...

http://modeltrainswithmusic.blogspot.ca/

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Posted by blownout cylinder on Wednesday, December 23, 2009 4:19 PM

Bucyrus
If I go to my banker and tell him I need to borrow $10,000, and he asks why?, I will say, “Why not?”

HEY!!---it seemed to work up until recently!!---Sign - Oops-did I say that too loudly?Sign - OopsMischief

As an aside here I do believe asking 'why?' is necessary at times. Given what has happened in terms of no doc loans and all that the question of 'Why?' would you 'need' a loan has come back. Maybe we need to ask that?

Any argument carried far enough will end up in Semantics--Hartz's law of rhetoric Emerald. Leemer and Southern The route of the Sceptre Express Barry

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Posted by Railway Man on Wednesday, December 23, 2009 4:19 PM

These are public policy questions, not railroad questions.  If you want to know what railroads can and cannot do, or can and cannot afford, please ask.  But whether the public should invest (or not) in railroad infrastructure or operations, that's not a railroad's role to decide.

RWM

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Posted by blownout cylinder on Wednesday, December 23, 2009 4:13 PM

Bucyrus
What is the purpose of educating the public about the importance of railroads?

 I would say the idea of educating the public about the importance of railroads would be the same as trucking---how about transportation as such? One reason would be to give young people who are in areas wherein certain issues--say, the lack of educational programming geared to the technical trades--a chance to get some of that information. Another reason would be to 'enlighten' certain populations who/what gets the goods they buy/eat/use to where they live. This last one was done pretty recently by the United Farmers of Ontario and other associated groups and had actually gained not only an increase in the interest in a host of rural issues but also created a dialog between both rural and urban areas. The purpose would be things like getting people interested in a career in those fields or creating dialogs or----

Bucyrus
Why does industry need encouragement to move their warehouses closer to rail, and how would you encourage it do so?

Reuse of former industrial land, bringing industry closer to the heart of a community such that one can reduce commutes further, creating eventually a stronger base for urban centers by bringing people into the whole of the city--rather than spreading them even further out into the area. Just a few off the top of my head---then again, I've been accused of yapping out'n my head anywaysLaugh

As for encouragement one would have to look at the situation that might be there. One way might be to offer a tax incentive to the business owner for a set number of years to offset the costs maybe of re-establishing the warehouse. Or, as an incentive to a business developer to re-establish a spur--if one needs re-establishing. I think that the issue here is that some of the problems now were mostly due to the increasing seperation of industry from urban development by planners who completely ignored the needs of industry as well.

So I'm wondering about how one goes about bringing RR into these development issues. Just some things to toss around---Smile,Wink, & Grin

 

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Posted by Anonymous on Wednesday, December 23, 2009 4:10 PM

If I go to my banker and tell him I need to borrow $10,000, and he asks why?, I will say, “Why not?”

 

And then I will tell him: “Perhaps you don't agree with that (nor do I), but it seems to me a discussion would be more productive if you were clear about which part you disagree with and why so.” 

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Posted by Ulrich on Wednesday, December 23, 2009 3:56 PM

Why not?Sign - Oops

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Posted by Anonymous on Wednesday, December 23, 2009 3:45 PM

schlimm

 

Bucyrus
What are the answers to those questions? 

Again I say, why not?  Why don't you answer a question or propose something positive instead of asking more questions without giving reasoning of your own?  He stated a need (infrastructue upgrades) and proposed a solution (let Congress...).  Perhaps you don't agree with that (nor do I), but it seems to me a discussion would be more productive if you were clear about which part you disagree with and why so.  

 

I am not agreeing or disagreeing with anything.  I just wondered why he believes a private business should ask congress for new infrastructure rather than just providing it by their own private investment as they typically do.  

 

I also wondered why he believes that the public should be educated about the importance of railroads.  Doing so would cost some money for advertising or whatever type of education he is proposing.  The part of the public that is uneducated about railroads is not the rail customer, so what is the point of spending money to educate that public?  What changes when the public becomes highly educated about railroads? 

 

I also wondered how he would encourage industry to move their warehouses closer to rail.  I would think that industry would already know enough to have their warehouses as close to rail as they need them to be.  How would industry benefit from moving their warehoused closer to rail if they have already determined that rail service is not what they need?

 

You can say that all my questions should be answered with:  â€śWhy not?”  And perhaps the person I have asked the question of would say the same.  So to the question:  “Why not?”  I would have to answer:  â€śBecause I see no point in what you propose.”  

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Posted by schlimm on Wednesday, December 23, 2009 2:54 PM

 

Bucyrus
What are the answers to those questions? 

Again I say, why not?  Why don't you answer a question or propose something positive instead of asking more questions without giving reasoning of your own?  He stated a need (infrastructue upgrades) and proposed a solution (let Congress...).  Perhaps you don't agree with that (nor do I), but it seems to me a discussion would be more productive if you were clear about which part you disagree with and why so.  

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Posted by Ulrich on Wednesday, December 23, 2009 2:21 PM

No rail experts..but they run the gravy train..Need money?...get a handout..

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Posted by Anonymous on Wednesday, December 23, 2009 2:10 PM

schlimm

Why not?  Since BT CPSO 266 already gave reasons why we should do those things,  dispute them by giving your reasons why not.

He gave partial reasons for what he proposed, but those reasons raise further questions such as the ones I asked above.  What are the answers to those questions? 

 

For instance, he said the railroads should ask congress to improve rail infrastructure.  The reason he gave is that rail infrastructure has a substantial need for infrastructure improvement.  He compared rail lines to a narrow, twisting highway that should be made more like a modern super highway. 

 What he did not address is why congress should do that.   

Is congress the rail expert that knows what track infrastructure is needed?

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Posted by schlimm on Wednesday, December 23, 2009 1:44 PM

Why not?  Since BT CPSO 266 already gave reasons why we should do those things,  dispute them by giving your reasons why not.

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Posted by Ulrich on Wednesday, December 23, 2009 1:16 PM

Indeed... railroads should finance their own infrastructure improvements..(just like any other viable business)..and marketing effectively to select customers instead of vaguely educating the public..

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Posted by Anonymous on Wednesday, December 23, 2009 11:57 AM

BT CPSO 266

Having the railroads focusing on asking congress for needed upgrades to the rail infrastructure.

1) Much of the rail network is like a double yellow line road with occasional brief passing lanes. They need to make the steel interstates like the fast moving highway interstates. 

2) Intermodal Terminal times need to be improved, having the trains loaded and unloaded faster. More organization and destination options.

3) Encouraging businesses to move their warehouses and distribution centers closer to terminals or even upgrade short lines so business can us rail as an option. 

4) Reeducation of America, we need to take a step up and start informing others of how far the rail industry has come and how important they are to our future.

If railroads need new infrastructure, why should they ask congress for it?

 

What is the purpose of educating the public about the importance of railroads?

 

Why does industry need encouragement to move their warehouses closer to rail, and how would you encourage it do so?

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Posted by BT CPSO 266 on Wednesday, December 23, 2009 10:18 AM

Having the railroads focusing on asking congress for needed upgrades to the rail infrastructure.

1) Much of the rail network is like a double yellow line road with occasional brief passing lanes. They need to make the steel interstates like the fast moving highway interstates. 

2) Intermodal Terminal times need to be improved, having the trains loaded and unloaded faster. More organization and destination options.

3) Encouraging businesses to move their warehouses and distribution centers closer to terminals or even upgrade short lines so business can us rail as an option. 

4) Reeducation of America, we need to take a step up and start informing others of how far the rail industry has come and how important they are to our future.

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Posted by schlimm on Wednesday, December 23, 2009 9:01 AM

 Perhaps we should get back on topic?  Namely the future.

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Posted by oltmannd on Tuesday, December 22, 2009 8:20 PM
You are forgetting about large chunks of the west end. Pittsburgh to Indy via Columbus and Muncie was all done in 77 and 78, and ripped up a few years later. Also, the PRR panhandle from Columbus to Indy was taken out, although it was never CWR. Then there was the NYC from Indy to St. Louis that was ripped up. If there was new rail purchased, it wasn't much!

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Posted by Paul_D_North_Jr on Tuesday, December 22, 2009 5:37 PM

oltmannd
  Much of what Conrail tore up in the early 80s had been rehabbed in the late 70s. They reused the nearly new track material to keep the viable lines going. Conrail did not have to purchase any new rail until the 1990s because of this . . . [snip; emphasis added - PDN]

The first part is certainly true of main lines, such as the '4th track' around Horseshoe Curve (then actually Track 2, if I recall correctly), the parallel 'Mule Shoe' line, the Atglen & Susquehanna 'Low Grade' line, the Trenton Cut-Off, etc., etc.  But I'm skeptical of the 2nd part, for a couple of reasons.  First, while some branch lines yielded rail that was good for relay as 'Switch and Yard' rail - albeit in some odd sections, such as the NYC's 127 lb. Dudley - most rail from branch lines was either light weight, corroded from coal dirt, and/ or 'surface-bent', etc., and so not suitable for reuse as anything other than 'reroll' or as scrap.  Second, in the fall of 1986 I had to arrange/ coordinate with ConRail's Lucknow CWR plant  (at the north end of Harrisburg, Penn.) to weld 8 strings* of new 132 RE from Bethlehem Steel Co.'s Steelton Plant - just a few miles to the south.  That rail was for installation around the new UPS building on the south/ east Delaware River side of the Philadelphia International Airport (at the old 'Hog Island' shipyard location) to relocate the 'industrial' line that ran up from Lester/ Chester to the Fort Mifflin area and the couple industries there.  I saw a lot of rail while there at Lucknow, and on the rail train that delivered my strings.  I can't swear that most or even any of it was new - there was a lot of relay still being processed - but the staff at Lucknow was not at all surprised or put out by getting and having to handle new rail - I still have a piece on my credenza with the 1986 mill date stamp.  Plus, when Norfolk Southern first attempted to purchase ConRail in the 1984 - 1985 time frame, the branch line to Delaware City, Del. was rehabbed with new 132 RE CWR - complete with the gray mill scale still on it - no doubt about it.  At the time I was convinced - and still am - that CR was 'burying' its cash in the track, where NS couldn't recover it, to discourage the possible 'raid' of same.

* The strings I wanted to be about 1,620 ft. long to minimize the number of 'closure' Thermite welds, which is a little longer than the normal 1/4 mile = 1,320 ft. or 1,440 ft. lengths,  So they had to add a few cars - like 4 or 6 - to the rail train - they were happy to accomodate me.

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Posted by blownout cylinder on Tuesday, December 22, 2009 5:15 PM

oltmannd
I'd say figuring out how to get traffic thru/around Chicago, Cincinnati and Atlanta may be, though.

IIRC--and please correct me if I'm off here--wasn't there some talk of some kind of a bottleneck in the Cleveland OH area at one time? Or is that still there?

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Posted by oltmannd on Tuesday, December 22, 2009 3:28 PM
CSSHEGEWISCH

Consider that a fair number of the lines that were spun off as short lines didn't accomplish much beyond postponing the day of reckoning.  An example with which I'm familiar is the west end of the EL main into Chicago, which was spun off as Erie Western on April 1, 1976.  Erie Western folded after about two years and the line ran for about another year as Chicago & Indiana, at which point the line was abandoned and the track taken up.

And, to this day, there is plenty of east-west mainline capacity east of Chicago even without the Erie main and the little used PRR main from Crestline. (getting in/out, thru/around Chicago is another story, though) . So, sticking to the topic, I'd say "restoring capacity removed by Conrail" is NOT one of the major challenges facing the RR industry. I'd say figuring out how to get traffic thru/around Chicago, Cincinnati and Atlanta may be, though.

-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/

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Posted by schlimm on Tuesday, December 22, 2009 2:28 PM

blownout cylinder
We need to reintroduce the concept of our being a 'producing' continent--again. And maybe then some kids will see opportunity for them---instead of closed doors----simply because they learn differently.

 

Exactly!!

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