Atlanta-Minneapolis Single Line Intermodal - Why Can't BNSF Do It Now

[MP173]

So it appears that Twin Cities - Atlanta will probably not support an intermodal train.  

This goes to prove that not every lane is going to be viable.

 

Ed

[CNSF]

If BNSF ran their PNW-Southeast service through the Twin Cities, 40-50 at a time would be enough to build a profitable block on existing trains. But it's not enough to support a new standalone train, and of course, there's always the capacity issue, both on the trains and at the end terminals. As long as there is demand for more PNW-Atlanta service, you wouldn't use that capacity to support a shorter-haul city pair. I like to believe that we'll see more intermodal service on these sorts of lanes some day, but it won't come until all opportunities for growth on longer-haul lanes are absolutely, completely tapped out.

[BaltACD]

If we are talking 50 containers/day - with 5-pack stack cars - that is 5 car loads or approximately 3000 feet of train.  My carrier wants to run their intermodal trains with upto 14000 feet of train.

People don't understand the recurring volume necessary for a rail line/service to be profitable.  If you have between 150-200 truck/containers per day then you are starting to talk about business worth serving and making a profit from.

[MP173]

466lex indicates 40-50 loads per day.  That doesnt cut it.

Recall that NS ran the Triple Crown into Twin Cities via the UP.  I saw that train a few times crawling thru Chicago.  No doubt the TCs went to Ft. Wayne where they were split up for Detroit, East Coast and the Southeast.  So...there was single line intermodal service recently, in the form of Triple Crown.  

 

Ed

[Convicted One]

kgbw49

So it begs the question - why can't BNSF develop that intermodal lane right now?

 

Having just read the article in question, I got the impression that the author used the Minneapolis-Chicago-Atlanta cooridor as an example because it suited the distance parameters of the the concept he was illustrating (the donut hole). Not that business demand justified it.

[blue streak 1]

iowahsrail

BNSF has its own tracks to Birmingham. After that ~150 miles of CSX trackage rights puts BNSF in Fairburn, GA. Why BNSF has never leveraged its Atlanta connection more fully is a head scratcher.

 

Atlanta is over flowing with intermodal damand.  As posted elsewhere CSX Fairburn terminal is at capacity with BNSF, UP and CSX traffic.   CSX Hulsey yard ( GaRR ) and Tilford yard ( NC&SL / L&N ) as well;

BNSF is starting a service that goes to NS's Memphis yard and then NS MEM - Chattanooga - Avondale ( NE of Atlanta ).  have to wonder how much excess capacity is left at Avondale ?

The new intermodal CSX yard at Chatsworth may or may not solve the problem but it is not is the best location for traffic from the west. 

[rdamon]

Seems like a good "Trails to Rails" project!!

https://www.traillink.com/trail-history/silver-comet-trail.aspx

[RME]

cat992c

BN is basically a western railroad.They have no connection to the southeast like NS does thru Southern Railway

Five words for ya, buddy:  Ship it on the Frisco.

[iowahsrail]

cat992c

BN is basically a western railroad.They have no connection to the southeast like NS does thru Southern Railway

 

 

BNSF has its own tracks to Birmingham. After that ~150 miles of CSX trackage rights puts BNSF in Fairburn, GA. Why BNSF has never leveraged its Atlanta connection more fully is a head scratcher.

[iowahsrail]

Kielbasa

The CSX terminal in Fairburn, Ga is in fact a rather large intermodal ramp. Almost exclusively BNSF power in there, with CSX people running the operation. About a year ago they underwent some improvements and BNSF had to reroute traffic to Memphis and dray our boxes to Atlanta on their dime. Pretty nice facility as far as they go, they could easily handle the added traffic if needed. 

 

 

There is BNSF staff on the ground in Fairburn. You might call it a joint BNSF/CSX facility. BNSF originates a significant amount of UPS traffic at Fairburn, much of it bound for LA, Oakland, Seattle.

[CNSF]

A few points to keep in mind, here. First, the OP asked about BNSF, so what's all this wailing about the bad effects of short-term institutional investors? Last I heard, Warren Buffet still owned BNSF. Second, in world where truckers like JB Hunt, Schneider, and Swift are your biggest customers, you hardly need to go out buy marketing data and grow some marketing cojones, you just pick up the phone and ask them if they could use a service between whatever two given endpoints are on your mind. Actually, knowing those truckers the way I do (they were all my accounts once) you don't even need to call them - they'll call you if they want something they think you might have. Third, does anyone know how BNSF handles PNW-Atlanta/Birmingham traffic today? An intermodal system map from 2015 which I found online suggests they either use an extremely circuitous routing on their own line via Omaha - KC - Oklahoma or else just hand off to NS or CSX at Chicago. If they are not even using the line between St. Louis and Memphis for PNW-Southeast intermodal traffic, there must be a good reason and I can't see them opening it up for a lane like Atlanta -Twin Cities.

[cat992c]

BN is basically a western railroad.They have no connection to the southeast like NS does thru Southern Railway

[BLS53]

samfp1943

BLS53 wrote the following post[in part].

Check out this link @http://www.abandonedrails.com/Hardin_Southern_Railroad

The line in question is the former NC&St.L RR from Paris,Tn. to Paducah,Ky.

[This site is of interest if tracking abandonments in Tenn:] http://www.abandonedrails.com/Tennessee

 

Yes, it was a NC & StL line. L & N bought them in 1957. The Hardin Southern ran a tourist train from Hardin Ky to Murray KY for awhile, but went out of business about 10 years ago. There's a shortline (KWT) that operates south of Murray into Tennessee that connects with the CSX. The track north of Hardin (about 40 miles worth) into Paducah, has been removed for over 30 years.

[466lex]

BNSF single-line intermodal service should be feasible, at least TOFC, via Minneapolis- Galesburg-Centralia (trackage-rights via CN)-Memphis-Birmingham-(haulage via CSX)-Atlanta.  (Clearances for double-stack? Unknown.)  The route should not be much more than 10% circuitous versus highway.

 

The major problem?  Volume.  Interestingly, data are available here:  “Freight Analysis Framework Data Tabulation Tool (FAF4)” online at:  http://faf.ornl.gov/fafweb/Extraction0.aspx

 

“FAF4” inquiries show the limited size of the opportunity:  Between 40 and 50 truckloads per day each way between the ENTIRE states of Minnesota and Georgia.  If entirely diverted, that volume alone would not support investment in daily train service.  But, perhaps as greyhounds and others have advocated, “beyond” traffic (Florida, for example) could make the route viable.

 

I don’t know about all of the Class 1s, but BNSF seems to be doing market development for intermodal:

 

http://bnsf.com/about-bnsf/financial-information/fixed-income-investors/pdf/fixed-income-investor-presentation-3rd-quarter-2015.pdf

BNSF:  Fixed-Income Investors Presentation, 3^rd Quarter, 2015, page 22

“113K Over-the-Road Conversions to BNSF Intermodal in 2014”

“12 member Intermodal Solutions Team dedicated to working with shippers to facilitate conversions”

3.6M

U S Loads Analyzed

 

607K

BNSF Network Opportunities

 

325K

Savings>5%

 

113K

OTR Conversions

 

 

Further recent examples are the new Texas-PNW train, and the new Atlanta-LA train with NS over Memphis.  (Perhaps the “Trains” article Minneapolis-Atlanta mention will stimulate further ideas.)

[samfp1943]

BLS53 wrote the following post[in part].

Check out this link @http://www.abandonedrails.com/Hardin_Southern_Railroad

The line in question is the former NC&St.L RR from Paris,Tn. to Paducah,Ky.

[This site is of interest if tracking abandonments in Tenn:] http://www.abandonedrails.com/Tennessee

[BLS53]

samfp1943

kgbw49, asked: "...So it begs the question - why can't BNSF develop that intermodal lane right now?.."

For starters, BNSF does not connect in Georgia, except by trackage rights (Location at Fairburn,Ga: I suspect is a facility to load unload autos(?) not sure about TOFC there(?). The line in Fairburn,Ga. [IIRC ] is CSX.   BNSF terminal in Birmingham, is former SLSF (from Memphis,via Amory,Ms). 

   Once in Memphis, a connection could be made, at W. Memphis,Ar. area (Marion,Ar(?) to the former SL-SF ' River Line' North to St.Louis, and then North to Minneapolis-St.Paul.   

The questions then would be: Is this route on the River Line cleared for 'Double-Stacks'? Or is it 'heavy' enough to support the extra traffic ? 

My recollection is, it might be classed as a 'secondary line', except for the steel mill traffic south of Osceola (Armorel),Ar. area(?)

An NS/BNSF Routing could be made North to a BNSF Connection in Southern, Ill.

{ NS runs or used to daily service through Jackson,Tn to St.Louis, and Chicago via a connection in Centralia,Il.  -(Not sure how they would welcome another 'dance partner' on that service?)   

      CSX is in Jackson,Tn. as well.   Then there is another potential connection at  Jackson,Tn. with the  West Tennessee RR (It operates between Corinth, Ms (on NS) and  The Fulton,Ky area. (CNR) 

 

I haven't done an analysis of actual traffic, but the old Frisco "river line" seems underutilized. I don't know the reason, but I seldom see a train on there, and when I do, it's a medium length manifest with old power on the front.

L & N used to have a line that came off the Memphis-Nashville line at about the midway point and ran north to Paducah. They swapped cars with the CB & Q, that came down from Centralia. In the early 1980's, the L & N line was abandoned. I don't know if that connection would have been of use to the BNSF and CSX today or not. The BNSF Centralia line still has a bunch of BNSF and UP PRB coal for river barges and power plants in the area, but no intermodals of any sort.

[schlimm]

samfp1943

Lots of options to build on, some existing railroad infrastructure; there would seem to be plenty of 'opportunities', but everything would be likely to 'shake-out' differently, if the ownership of the railroad routes see changes in mergers and acquisitions?  

If sam (a clever non-railroader) can envision many possible targets (routes and services) for revenue growth, it shows that it is possible for the rails to do so, but only if they hired folks with some vision who were given a mandate.

[schlimm]

Day trading, programmed trading, options trading are just extreme examples of the casino, aka, the stock market.  Unless you purchase an IPO or some new shares released by a corporation, you really aren't investing in the company in the sense that you are adding to its capital, even if you hold them for twenty years. You've only bought that capital from a prior owner, i.e., a transfer.  Along the way, you may receive some dividends.

[samfp1943]

tree68

 

 

Murphy Siding

Understood, but the entity that buys several million dollars worth of stocks at a time generally has some different motives than you do.

 

 

I could be wrong, but as I recall, computers are playing heavily in the stock trading game - and I would imagine that they are playing nearly second to second, not week to week or month to month.  

A million shares increasing in value by $.02 has a yield of $20,000 - time to sell.  Do that several times an hour and you're talking some cash.  Then multiply by days and weeks.  These folks are gamblers, not investors.  Investing is for chumps like us.

 

    WE are sort of getting out into the 'weeds', but stock value, and Returns on Investment definitely come into play as a corporate decision is made about how as railroad manages its system.

Seems that tree68 and Murphy Siding make some pretty valid points about stock trading in this day and time; particularly, where computer programs are used to make almost instaneous trades, activities can be keyed for the computer to 'move' when perameters are set for it. A couple of triggers might be stock volumes trading or limits as to pricing.

dakotafred seems to fall into a group that would be 'traditional traders(?)'. A system that works for his needs and goals.  My position is more of interested bystander, A couple of times, acting on good friends, I did invest, and got a lesson learned the hardway.

 To reinforce tree68's point about buying and selling here is some information:  @http://www.investopedia.com/terms/a/averagedailytradingvolume.asp

This link has information:based on average daily volumn and its effects on a couple of examples: http://www.investopedia.com/articles/active-trading/091514/essential-strategies-trading-volume.asp

[tree68]

Murphy Siding

Understood, but the entity that buys several million dollars worth of stocks at a time generally has some different motives than you do.

I could be wrong, but as I recall, computers are playing heavily in the stock trading game - and I would imagine that they are playing nearly second to second, not week to week or month to month.  

A million shares increasing in value by $.02 has a yield of $20,000 - time to sell.  Do that several times an hour and you're talking some cash.  Then multiply by days and weeks.  These folks are gamblers, not investors.  Investing is for chumps like us.

[Murphy Siding]

dakotafred

I must disagree with some of the posters above about "stockholder wants."

Which stockholders? Day (or month) traders maybe, but certainly not me. If I find a company I believe in, with (sometimes) a dividend I like, I stick with it until shown a reason I shouldn't.

I think the short-term thinking is more on the part of executives trying to satisfy the terms of their annual bonus. Which terms reflect the thinking of the board, about which most investors know precious little.

So don't scapegoat the investors, who do make the wheels turn. 

 

Understood, but the entity that buys several million dollars worth of stocks at a time generally has some different motives than you do.

[BaltACD]

dakotafred

I must disagree with some of the posters above about "stockholder wants."

Which stockholders? Day (or month) traders maybe, but certainly not me. If I find a company I believe in, with (sometimes) a dividend I like, I stick with it until shown a reason I shouldn't.

I think the short-term thinking is more on the part of executives trying to satisfy the terms of their annual bonus. Which terms reflect the thinking of the board, about which most investors know precious little.

So don't scapegoat the investors, who do make the wheels turn.

Institutional investors - those trading thousands to millions of shares and looking for a return today, not tomorrow or the next day.

[dakotafred]

Now that I think about it, I'll also concede you the Bill Ackmans. They are the wild card, sometimes for good, sometimes for ill. I will say I bought CP only after Ackman brought in Hunter Harrison. 

[dakotafred]

I must disagree with some of the posters above about "stockholder wants."

Which stockholders? Day (or month) traders maybe, but certainly not me. If I find a company I believe in, with (sometimes) a dividend I like, I stick with it until shown a reason I shouldn't.

I think the short-term thinking is more on the part of executives trying to satisfy the terms of their annual bonus. Which terms reflect the thinking of the board, about which most investors know precious little.

So don't scapegoat the investors, who do make the wheels turn. 

[tree68]

Murphy Siding

Stockholders don't want that.  They want instant profits and stock value without any of that naughty old risk and investment.

The phrase "long term investment" isn't in their vocabulary any more...

Of course, that's true for a lot of things.  Remember when even a stinker of a TV show would run for an entire season?  Now, if the ratings aren't good immediately, out it goes.

There were more than a few shows "back in the day" that developed a following over time and became beloved...

[rrnut282]

The railroads don't need to merge to handle short-to-medium hauls that cross interchange barriers.  They can cooperate and market it like a single line haul.  Run-through loose car trains have been running for years. 

There is still one major roadblock to railroads cooperating on unbalanced short-to-medium hauls (like ATL-MSP) and that is division of revenues.  The railroad on the short side doesn't want to/won't participate without a bigger slice of the pie to make it worth the effort (in their eyes) and the railroad on the long side won't give up their "fair share". 

If and when that can be worked out, the railroad(s) can actively go after those loads that are out there, waiting. 

[Murphy Siding]

schlimm

 

Murphy Siding

The current climate doesn't seem to have much time for what greyhounds is advocating- building the business up from scratch.  Right now, it's all or nothing.

 

 

If the rails lack the personnel to do what greyhounds used to do, then top management needs to do something about that.  It requires an aggressive, creative staff backed by resources and a committment by management to break through obstructions.

 

Stockholders don't want that.  They want instant profits and stock value without any of that naughty old risk and investment.

[schlimm]

Murphy Siding

The current climate doesn't seem to have much time for what greyhounds is advocating- building the business up from scratch.  Right now, it's all or nothing.

If the rails lack the personnel to do what greyhounds used to do, then top management needs to do something about that.  It requires an aggressive, creative staff backed by resources and a committment by management to break through obstructions.

[samfp1943]

greyhounds stated [in part] in a preceding post on this Thread: "...Well, a couple of things.

First, the fact that the traffic exists can be documented.  But it's currently moving by over the road trucking.  Can the railroad divert it to intermodal is the first question.  A following question is will the amount diverted to intermodal and the resulting revenue justify any necessary expenditures?

Remember what a wise old railroad man (Southern Pacific) once said:  "There is no certainty, only reason and experience to guide us."  Taking prudent and evaluated financial risks is a part of any business, including railroading.  Don't get reckless.  But totally avoiding business risks is its own significant risk.  As they reportedly say in the Army: "Anything you do can get you killed, including nothing."..."[snipped]

One way to see some of the potential  for traffic might be to survey the traffic existing currently on the some of the 'road-links' involved. There are some city pairs that have for years seemed to 'cry out' for relief from the commercial traffic flow; and have seemed to be needing some form of relief for some time.

  Purely, personal,  and unscientifc observatons seem to point to the truck- traffic flow  between Atlanta and Birmingham. Both cities seem to be heavily, destinations and origins for freight.   Distance is also short being approx only 149 miles apart. 

 Would seem to call for a hub and spoke operation, with the railroad serving as the transport; the major cost added would seem to be drayage at the pick up and delivery. 

Atlanta, Birmingham, Meridian,Ms, Jackson,M. and Dallas-Ft.Worth.

  Already, in-part of a NS-KCS Route(?). 'The Meridian Speedway', with Yard and Interchange in Shreveport, which accesses KCS System, points both North,  and South.

 The there is a CSX routing: Atlanta, Chattanooga,Nashville, Louisville, Chicago. (?) . Already a prime route for CSX (?) 

And the discussed: Atlanta, Birmingham, Memphis, St. Louis, (intermediate points(?), Minneapolis-St. Paul routing; which then puts one on to the BNSF's Northern Transcon. 

 The BNSF Intermodal ramp at the Capelville(TN) [Tennessee Yard] would give lift and hub access to Western Routes [one is Southern Transcon ] off BNSF.

  Do not also forget the UPR's big ramp West of Marion,Ar.  [and smaller former interchange, MoPac yard in Marion, and Sargent Yard in Memphis,Tn.]  

 Another, very heavily traveled commercial traffic route is Nashville, Memphis, Little Rock, Dallas-Ft.Worth, and points West...

Lots of options to build on, some existing railroad infrastructure; there would seem to be plenty of 'opportunities', but everything would be likely to 'shake-out' differently, if the ownership of the railroad routes see changes in mergers and acquisitions?  

[Kielbasa]

There has been some talk around these parts of CSX building a small yard near Chatsworth,Ga to siphon truck traffic away from Atlanta. At one time I read the initial plan was something like 50,000 containers annually, mainly from the Port of Savannah. No idea if/how that would affect traffic inbound from the west, possibly Memphis to Nashville and down? The locals have raised some opposition to the project and I am not sure what the current status is, although I bet someone here does! Seems like CSX ran into similar issues with siting the yard in North Carolina as well. Chatsworth is really a decent location, near enough to Chattanooga and the confluence of I75 and I24 l, gets you anywhere fairly quickly.