Part posturing and part gamesmanship... and part lying apparently..they can't both be telling the truth..
edbenton EHH viewed Repairs to Load and Empty compensators as UNNEEDED on Bulkhead Flat cars also Dynamic Brakes were UNNEEDED ALSO. Then the Accident happened in BC werre the Entire Crew was Wiped out in a Saftey Cab Equipped GP-40-2 on a Grade. What Happened there a Broken adapter that said if the Car had a load on it was Broken well the car was Loaded. Then they were sent on a local on a train without Dynamic Brakes to get that car. The OPTPB were something like 3X the limit on a line with 25 MPH curves the Event recorder showed them leaving the tracks at 80 MPH. One crew Member survived and he did say We said someone would be killed thanks to EHH and his RULES ON SAFTEY. EHH said either run the train or I WILL FIND SOMEONE that will. The Canaditon Saftey Board Placed the Blame Squarely On EHH and his Culture of FEAR where if someone spoke out against him they were afaird to LOSE their JOBS. [snipped] Here is an Example of what can Happen under EHH Leadership Do you want this kind of thinking on Rodgers and Kicking Horse where he Demands No DB trains. http://www.tsb.gc.ca/eng/rapports-reports/rail/2006/r06v0136/r06v0136.pdf [59 pages, approx. 1.60 MB file size in this 'PDF' format version - PDN]
The Canaditon Saftey Board Placed the Blame Squarely On EHH and his Culture of FEAR where if someone spoke out against him they were afaird to LOSE their JOBS. [snipped]
Here is an Example of what can Happen under EHH Leadership Do you want this kind of thinking on Rodgers and Kicking Horse where he Demands No DB trains.
http://www.tsb.gc.ca/eng/rapports-reports/rail/2006/r06v0136/r06v0136.pdf [59 pages, approx. 1.60 MB file size in this 'PDF' format version - PDN]
In fact, even though this wreck occurred on 29 June 2006, and just a few days later - on 04 July 2006 - a Transport Canada Rail Safety Inspector issued a "Notice and Order" that CN require Dynamic Brakes on this grade, that did not actually occur until 01 Feb. 2009, some 2-1/2 years later ! In the meantime, the lukewarm CN bulletin issued in August 2007 - over a year later ! - would have allowed essentially the same situation to occur again ! See Sec. 4.1.3., pgs. 47 - 48.
The report also claims that "Since employee concerns with the use on non-DB–equipped locomotives on this territory were not brought to the attention of management, either through the local Occupational Safety and Health (OSH) Committee or by any other available means, an opportunity was lost to resolve this safety issue." (Sec. 3.2.8, pg. 43).
In any event, I also wonder what steps the employees and unions took to protect themselves before this accident. Why didn't a car inspector detect the broken empty/load adjustment valve and the missing plate ? Why was the crew apparently unfamiliar with the concept of maximum Tons Per Operable Brake, which would have clearly indicated the potential for disaster with this train ? (PRR, ConRail and Norfolk Southern rules for the slightly less steep grade past Horseshoe Curve would have mandated using and turning up the brake retaining valves to keep a constant brake 'set' - otherwise, the train would be prohibited, or other safety steps taken.) Why didn't they add a few 'idler cars' to provide additional braking power ? Why were they not familiar with brake fade - aren't even Over-The-Road truckers familiar with that risk ? Why didn't the crew guard against it by creeping downhill at 8 to 12 MPH (also required on a portion of that same PRR-CR-NS grade, "The Slide") ? Bluntly and perhaps cruelly - and setting aside for just a moment the obvious multiple CN management failings here - it seems to me there was also contributory negligence on the part of that crew and some of the support personnel as evidenced by their apparent lack of interest having sufficient knowledge and taking steps towards their own self-preservation. This is a mountain railroad, with steep grades - traditionally a demanding operating situation that tolerates no mistakes, and no place for unqualified 'newbies' or amateurs there. And why didn't the local union chairmen stand up for their members against the CN management on this issue?
And all that being said - going forward from here, though, the operating employees, their unions, and Transport Canada now ought to be fully aware of what may come from EHH's appointment to CP, and should start to take appropriate actions to protect themselves.
- Paul North.
PNWRMNM It looks like Ackerman put that story out, presumably as a shot across the bow of Green and the CP board.
It looks like Ackerman put that story out, presumably as a shot across the bow of Green and the CP board.
He shoots! He scores! That's one point for Mac McC.
There are reports on a Canadian RR forum that there is a response from CN, according to today's Wall Street Journal. It seems they are perturbed at the idea of EHH going to work for the competition. Part of EHH's pension benefits are tied to stocks and stock options, and the idea of him working for the CPR while holding all of these CN shares, that are tied to future stock prices, isn't sitting well with them.
One commentator said that it seems peculiar that a individual with the alleged expertise of W. Ackman would not have already known this before he put out the story about approaching EHH, and that he knew from the get go that he couldn't bring EHH on board. If he didn't, that says something else entirely about his alleged expertise. Curiouser and curiouser.
I can't post a link, it seems the WSJ site doesn't like me being from out of state, if you will.
Bruce
So shovel the coal, let this rattler roll.
"A Train is a Place Going Somewhere" CP Rail Public Timetable
"O. S. Irricana"
. . . __ . ______
Or maybe Ackman is a master gamesman...that confict with Hunter and CN to be resolved via a working relationship between CN and CP...perhaps a merger of lines west of Calgary and further rationalization of lines and terminals in Ontario.
Well the stock price shot up with the announcement, and Ackman has a TON of CP stock...I am sure he made millions already.
Mechanical Department "No no that's fine shove that 20 pound set all around the yard... those shoes aren't hell and a half to change..."
The Missabe Road: Safety First
Stock went down today though... maybe due the gong show performance between Cleghorn and Ackman..
Somehow, this is starting to look like Ackman is looking for a quick appreciation in the value of his CP holdings and not much else. Consider that he is not interested in a board seat and that he suggested E Hunter Harrison as a CEO candidate, even though it appears that Harrison may not be available.
Also starting to look as if Ackman isn't quite as prepared as he should have been if it turns out that Hunter is not available/not interested. Those things need to be worked out before they are made public or else all involved end up looking foolish and less than capable. Maybe CP's recent slide in stock price is a reflection of that.
Ackman rebuffed by CP Board
http://www.bloomberg.com/news/2012-01-09/ackman-rebuffed-as-canadian-pacific-says-ceo-green-will-stay-1-.html?cmpid=yhoo
Never too old to have a happy childhood!
This is reported to be a formal action of the Board of Directors. Asssuming that to be true, Round 1 goes to the incumbents.
Mac
Ackman makes move to replace Board of Directors
Ackman Doesn't give up
This is getting interesting as I don't recall ever hearing of a proxy fight among the shareholders in the history of the company. The word monolithic has been used to describe the Board of Directors and the Shareholders more than once. Most shares are held by institutional investors. With all the talk of Hunter Harrison joining the company, and then apparently not being able to, the share price moved a $1.07 in the $69-70 price range over the whole week.
I think this will go one of two ways. Either (a) the die has already been cast, or will be soon, and the decision taken to replace Mr. Green or (b) Mr. Ackman's 14.2% along with maybe another 0.2-0.5% will vote for change, and the motion will be defeated. There are still a number of shares held by British institutions, some since the nineteenth century, so I don't think this fight is going to play out in the media like Mr. Ackman hopes. Mr. Ackman's correspondence to shareholders will no doubt be "leaked" to the media, but I don't expect we will hear anything from the other side publicly, as they will keep their usual stiff upper lip.
This is going to shake out as a turning point in the company history in many ways.
Ackman's people will be lobbying the large institutional investors HARD to vote their shares his way. Remember institutional investors care nothing about the continued existence of CP as continuing railroad operation - all the care about is the $$$$$$$$$. Their decisions will be base upon the confidence they have or lack in Ackman's ability to deliver the results he is claiming.
AgentKid This is getting interesting as I don't recall ever hearing of a proxy fight among the shareholders in the history of the company. The word monolithic has been used to describe the Board of Directors and the Shareholders more than once. Most shares are held by institutional investors. With all the talk of Hunter Harrison joining the company, and then apparently not being able to, the share price moved a $1.07 in the $69-70 price range over the whole week. I think this will go one of two ways. Either (a) the die has already been cast, or will be soon, and the decision taken to replace Mr. Green or (b) Mr. Ackman's 14.2% along with maybe another 0.2-0.5% will vote for change, and the motion will be defeated. There are still a number of shares held by British institutions, some since the nineteenth century, so I don't think this fight is going to play out in the media like Mr. Ackman hopes. Mr. Ackman's correspondence to shareholders will no doubt be "leaked" to the media, but I don't expect we will hear anything from the other side publicly, as they will keep their usual stiff upper lip. This is going to shake out as a turning point in the company history in many ways. Bruce
We've seen various stories in the media, but I thought I would link in CP's open letter to shareholders posted on the CPR website.
http://www.cpr.ca/en/news-and-media/news/Pages/open-letter-to-shareholders.aspx
In the letter I found the tenth, eleventh and most importantly the thirteenth paragraphs very interesting. I'm not sure EHH's bull-in-a-china-shop methods would be appropriate for dealing with the issues raised in the last paragraph I cited.
I will leave you to draw your own conclusions.
Sounds like Ed Harris has an axe to grind with CN...CP was also largely built by taxpayers.
I'm not sure I can agree with your assertion. I don't believe you can equate land grants in virgin unsettled territory, with actual expenditures by the Government of Canada. CP was financed and built by Donald Smith et all, with the hope of partially recouping their investments by reselling the land, and the rest with actual revenues from operations. Not continuing to operate by receiving yet more money from the Government of Canada.
It seems to me that it doesn't make any difference how the CP and CN got to where they are now. Harris suggested that with its greater double trackage and siding configuration, CN has an operational advantage over CP and that accounts for at least part of the better operating ratio.
At any rate, I don't buy the notion that that "Precision Scheduled Railroading" is a magic bullet that will automaticly knock 10 points off an operating ratio and at this point that seems to be the sum and substance of Ackerman's plan.
"We have met the enemy and he is us." Pogo Possum "We have met the anemone... and he is Russ." Bucky Katt "Prediction is very difficult, especially if it's about the future." Niels Bohr, Nobel laureate in physics
CN then wasn't built by taxpayers either; after all CN was initially the conglomeration of a number of private lines including the National Transcontinental, the Intercolonial, the Canadian Nothern, the Grand Trunk and Grand Trunk Pacific. The railways in Canada were overbuilt by the beginning of the last century , and the formation of CN was for the most part an attempt to rationalize and to make sense of railways that by themselves had no hope of becoming profitable. The fact that CN does so well today is testament to the fact that the Company was reasonably well managed in its last decades as a Crown Corporation and of course since its privatization in 1995.
AgentKid We've seen various stories in the media, but I thought I would link in CP's open letter to shareholders posted on the CPR website. http://www.cpr.ca/en/news-and-media/news/Pages/open-letter-to-shareholders.aspx In the letter I found the tenth, eleventh and most importantly the thirteenth paragraphs very interesting. I'm not sure EHH's bull-in-a-china-shop methods would be appropriate for dealing with the issues raised in the last paragraph I cited. I will leave you to draw your own conclusions. Bruce
CP's "long train strategy" is mentioned several times in that letter. According to an article in the August 2011 edition of Railway Age on Distributed Power ("DP") operations (pgs. 14 - 18), CP now routinely runs 14,000 ft. long trains and is planning to go longer, whereas CN presently limits its train lengths to 8,500 ft. (39% shorter) since a March 2009 derailment at Brighton, Ontario as a result of excessive in-train forces. See an on-line version of that article at: http://www.railwayage.com/in-this-issue/the-long-and-the-short-of-distributed-power-august-2011-3660.html
[EDITED 12 Jan 2012 6:05 AM EST, only to fix misplaced paragraph . . . ] Further, for those who think CP wasn't reinvesting in its franchise, remember that in the mid-1980's several hundred million dollars CDN were invested in the new Rogers Pass tunnel and bridges as part of that additional line and capacity project.
But I do think that CP's relinquishment of its lines and operations east of Montreal 2 decades or so ago was a strategic mistake - someday those routes will be worth having again . . .
The one thing I think I can say without fear of contradiction.....
From here on out until the counting of the proxy ballots - it wll be charge and counter charge between Ackman and the existing CP Board mostly played out in the media.
Paul_D_North_Jr AgentKid: We've seen various stories in the media, but I thought I would link in CP's open letter to shareholders posted on the CPR website. http://www.cpr.ca/en/news-and-media/news/Pages/open-letter-to-shareholders.aspx In the letter I found the tenth, eleventh and most importantly the thirteenth paragraphs very interesting. I'm not sure EHH's bull-in-a-china-shop methods would be appropriate for dealing with the issues raised in the last paragraph I cited. I will leave you to draw your own conclusions. Bruce Bruce, thanks much for posting the link to that letter and your guidance as to the most interesting paragraphs ! (I concur). A couple other factual points to consider: CP's "long train strategy" is mentioned several times in that letter. According to an article in the August 2011 edition of Railway Age on Distributed Power ("DP") operations (pgs. 14 - 18), CP now routinely runs 14,000 ft. long trains and is planning to go longer, whereas CN presently limits its train lengths to 8,500 ft. (39% shorter) since a March 2009 derailment at Brighton, Ontario as a result of excessive in-train forces. See an on-line version of that article at: http://www.railwayage.com/in-this-issue/the-long-and-the-short-of-distributed-power-august-2011-3660.html But I do think that CP's relinquishment of its lines and operations east of Montreal 2 decades or so ago was a strategic mistake - someday those routes will be worth having again . . . - Paul North. Further, for those who think CP wasn't reinvesting in its franchise, remember that in the mid-1980's several hundred million dollars CDN were invested in the new Rogers Pass tunnel and bridges as part of that additional line and capacity project.
AgentKid: We've seen various stories in the media, but I thought I would link in CP's open letter to shareholders posted on the CPR website. http://www.cpr.ca/en/news-and-media/news/Pages/open-letter-to-shareholders.aspx In the letter I found the tenth, eleventh and most importantly the thirteenth paragraphs very interesting. I'm not sure EHH's bull-in-a-china-shop methods would be appropriate for dealing with the issues raised in the last paragraph I cited. I will leave you to draw your own conclusions. Bruce
Bruce, thanks much for posting the link to that letter and your guidance as to the most interesting paragraphs ! (I concur). A couple other factual points to consider:
Further, for those who think CP wasn't reinvesting in its franchise, remember that in the mid-1980's several hundred million dollars CDN were invested in the new Rogers Pass tunnel and bridges as part of that additional line and capacity project.
Maybe in Canada, but in the US they still run 11,000+ land barges.
OK, I think I have this figured out now - it goes like this:
First, starting about 2007, Warren Buffett buys a similar 15% or so size portion of BNSF - then expands it, and in late 2009 decides to buy the whole thing.
Then, starting about 2006 Bill Gates starts buying CN, and as of April 2011 owned a little over 10 % of it.
Now we have another rich guy - Ackman - perhaps trying to emulate those 2 worthies by buying a 14% or so part of CP.
But Ackman appears to have overlooked the part where they leave the present competent management in place and alone to run the railroad operation as they see fit - instead, he appears to be "pulling up the flowers to see how well they're growing". Time will tell . . .
Ackman is a Hedge Fund operator - as such they have no intent in running the business they invest in for the long term benefit of the business - just the short term wherein they can squeeze all the finances possible out of the company, they they will dump the stock and move on to the next victim bragging about all the 'profits' they were able to get out of the smoldering hulk of their most recent victim after having run up the dividends and debt by almost equal amount. The hulk is left with the debt and without any earnings put back into the physical plant.
Paul_D_North_Jr OK, I think I have this figured out now - it goes like this: First, starting about 2007, Warren Buffett buys a similar 15% or so size portion of BNSF - then expands it, and in late 2009 decides to buy the whole thing. Then, starting about 2006 Bill Gates starts buying CN, and as of April 2011 owned a little over 10 % of it. Now we have another rich guy - Ackman - perhaps trying to emulate those 2 worthies by buying a 14% or so part of CP. But Ackman appears to have overlooked the part where they leave the present competent management in place and alone to run the railroad operation as they see fit - instead, he appears to be "pulling up the flowers to see how well they're growing". Time will tell . . . - Paul North.
Ackmann isn't going to get very far if most of the large stockholders are in for the long haul.
BaltACD Ackman is a Hedge Fund operator - as such they have no intent in running the business they invest in for the long term benefit of the business - just the short term wherein they can squeeze all the finances possible out of the company, they they will dump the stock and move on to the next victim bragging about all the 'profits' they were able to get out of the smoldering hulk of their most recent victim after having run up the dividends and debt by almost equal amount. The hulk is left with the debt and without any earnings put back into the physical plant.
-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/)
I read on googlefinance that Hunter has responded and that he is interested and will be there for as long as he is needed...Will be interesting to see how this plays out.
Having spent 24 years at SOO/CP, I was able to observe CP going from a quiet couple seats on SOO's board, to fighting CNW for the first the Spine Line and then the Milwaukee Road (won one, lost one), to creating an internal short line of the Wisconsin portion of the former SOO while they tried to decide whether to sell it all or make it employee owned and then finally buying the remaining 44% they didn't own, to selling the internal short line (that is now part of CN), to selling off the former Milwaukee lines in Iowa and to KC. Since I left 8 years ago, they have now bought back the Iowa and KC lines plus more.
I always felt that CP corporate could never really make up their mind about the stuff south of the border. They started a program to extend sidings on the Mpls to Portal line but didn't want to take the next step of putting in signals west of Glenwood and across the border to Moose Jaw.
They have what could be a competitive route from Vancouver to Chicago but haven't improved it sufficiently to compete with BNSF from Seattle.
It is interesting to watch Ackman stir up Calgary. It is an intersting "club" there. While a lot of Canadians moved south to work on the US side of the property, very few Americans went north. Hunter (an American) among the Canadian pigeons again could be a site.
The railroad cultures have some differences and I did not see a lot of "American" taking hold in the north, but a fair amount of "Canadian" taking hold in the south.
Is this a chance to take some north? Should I send Hunter my resume? We'll see. As Bette Davis said, "Fasten your seat belts, its going to be a bumpy ride"
Thing I don't understand with Canadian Railroading, is why can't they seem to understand operating principles as the US does which is ironic considering a lot of management in the Canadian companies are American.
I just don't get what is the difference between the likes of CP and CN vs NS, CSX, UP and BNSF with the exception of course of more customers due to higher population of course. But on a more micro scale, it seems Canadians can't get railroad operations right vs the US.
If CP wants to increase revenues, why don't they answer the demand of trash trains? Toronto and other municipalities are practically begging for someone either CN or CP to answer their call and yet nobody answers; all other Class 1 railroads in the US run unit trash trains. CSX/UP runs produce trains, NS runs tons of roadrailers, CSX runs Tropicana unit trains, UP and CSX have partnership runs via intermodal (Stax); how come CN or CP can get something going with another Class 1 railroad or get big customers and run extra trains? Why are they having capacity issues? Why are they not embarking more on projects that involve government investment such as the private and public partnerships NS and CSX have been getting with their new intermodal facilities and tunnel clearence projects? Why didn't CN or CP do anything with the Canada Southern Line since they bought the thing? Why does CP run trains with 5 SD40-2s and only only 20 cars max LOL; can't always be a power move?
I just don't get the impression that railroad management in Canada seems to know how to run a railroad the same as the others and the others in the US seem to have the support of its shareholders yet now people are complaining about CPs.
With regard to CP's operating performance, take a look at the "Railroad Performance Measures", at: http://www.railroadpm.org/Performance%20Reports/CP.aspx
For Dec. 2011 - selected because it's recent, but not as variable or volatile as a weekly figure - the "Terminal Dwell (Hours)" for the Entire Railroad was 18.3 Hours, and the "Train Speed (Miles per Hour)" for All Trains was 24.3 MPH; the corresponding figures for CN were 16.7 Hours and 27.6 MPH - somewhat better but not conclusively so, in my opinion.
Just for fun, the corresponding figures for the other Class I's were:
BNSF - 26.0 Hours, 24.8 MPH
UP - 27.4 Hours, 25.9 MPH
KCS - 20.6 Hours, 27.7 MPH
CSX - 25.6 Hours, 22.4 MPH
NS - 24.3 Hours, 22.3 MPH
Although these numbers are not supposed to be used to directly compare one railroad with another, nevertheless it's still interesting to observe that little KCS clearly has the best figures for a US railroad; but either Canadian railroad beats all US railroads for shorter Terminal Dwell time, and are not far off the pace for Train Speed, either.
Paul_D_North_Jr "OK, I think I have this figured out now - it goes like this: First, starting about 2007, Warren Buffett buys a similar 15% or so size portion of BNSF - then expands it, and in late 2009 decides to buy the whole thing. Then, starting about 2006 Bill Gates starts buying CN, and as of April 2011 owned a little over 10 % of it. Now we have another rich guy - Ackman - perhaps trying to emulate those 2 worthies by buying a 14% or so part of CP. But Ackman appears to have overlooked the part where they leave the present competent management in place and alone to run the railroad operation as they see fit - instead, he appears to be "pulling up the flowers to see how well they're growing". Time will tell . . . - Paul North.
"OK, I think I have this figured out now - it goes like this:
Paul:
Your analogy of Rich Guys buying railroads could be carried backward another step to include: Phillip J. Anschutz
Starting in 1984 when he bought Rio Grande Industries [parent of the DRG&WRR], four years later.
In 1988 his corporation bought Southern Pacific Railroad.,
In 1996 Southern Pacific and Union Pacific merged.
In 2007 he bought the corporation that owned the Grand Canyon Railway.
In 2008 he bought the Oklahoma Publishing Co which owned the
Maintou and Pikes Peak Railway.
There is another individual to add to the group of "Big Boys playing trains."
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