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News Wire: CSX claims record-low operating ratio of 60.3

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Posted by oltmannd on Monday, January 28, 2019 3:16 PM

zardoz
I have a question regarding this whole PRS fallacy: Supposedly one of the benefits of PSR is the ability to "move more tonnage with fewer locomotives". Someone please explain this to me.

Two ways.

The main one is fewer locomotives in the fleet because the train flow is balanced by design.  (there are other ways of balancing flow, but the EHH way is the dirt-simplest.)  This where the bulk of it comes from.

The second way is much smaller, but make each locomotive "increment" more useful.  If you have 16000 tons to move and need 1 HP/ton:

Two 5000 ton trains and a 6000 ton train each need two "big" locomotives (4000+ hp) for a total of 6 locomotives. 

Two 8000 ton trains need two each for a total of 4 locomotives.  This is much smaller, overall, and tends to reduce the avg over the road speed a bit. 

The somewhat overpowered three train scenario should result in somewhat faster trip times on the average - better than what the service requires.

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

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Posted by cx500 on Monday, January 28, 2019 8:16 PM

Ulrich

More tonnage with fewer crews maybe.. not fewer locomotives. And I doubt power is fitted exactly to tonnage, and they wouldn't leave 2000 tons behind just because taking those extra tons would require one more locomotive. PR or no, it's about optimizing available resources.. whether its locomotives or crews, cars or track.  

 

Actually, they probably would because PSR has put that extra locomotive into storage and it is no longer available.  PSR crippled the port of Halifax as a container port.  Unloading containers there was successfully promoted as giving a day or two earlier arrival in Chicago, a premium service.  But then PSR started leaving them sitting on the dock for days because the train was maxed out.  Might as well bypass Halifax and unload the whole ship in New York, save some dollars, and have more predictable service.

PSR may be an excellent method for operating a railroad.  But the railroad should be in the business of providing transportation at a profit, which is more than just playing trains.  Constraining the growth of a business in a growing economy is a good recipe for mediocrity, and even shrinkage as dissatisfied customers depart.  The railroads are somewhat protected by many commodities having no realistic choice but rail for shipment, and often only one railroad available to serve them.

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Posted by rrnut282 on Tuesday, January 29, 2019 11:47 AM

How many customer surveys have the railroads paid for that told them customers were looking for consistant service?  Not faster or cheaper, though, I'm sure they came in second or third.  What does PSR give the customer?  Less consistancy.  

Mike (2-8-2)
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Posted by Ulrich on Tuesday, January 29, 2019 12:42 PM

So consistently inconsistent.. 

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Posted by Euclid on Wednesday, January 30, 2019 8:45 AM

rrnut282
What does PSR give the customer? Less consistancy.

  Please explain what this means and why it is so.

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Posted by blue streak 1 on Wednesday, January 30, 2019 1:21 PM

Hope we are wrong but what does a low OR really mean.  Here it means that routine track maintenance is being put off.  So now CSX will have deferred maintenance costs to build up .  Once all the capital needed to do that maintenance is removed and CSX then has to put so much capital into getting the deferred maintenance resolved that their OR will "suddenly" return to being over 100,.  That will happen because the old adage pay now or pay more later applies to deferred maintenance.  Prime example is the NEC of Amtrak.

One way this problem can be resolved is requiring companies to somehow place deferred maintenance into the OR costs calculation.  How? Unknown but certain costs of track surfacing, signal upgrades, loco replacements, etc  per track mile might be one way?  That is even if not completed still in costs?  Maybe revenue ton miles per track section as well?

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Posted by charlie hebdo on Wednesday, January 30, 2019 2:27 PM

blue streak 1

Hope we are wrong but what does a low OR really mean.  Here it means that routine track maintenance is being put off.  So now CSX will have deferred maintenance costs to build up .  Once all the capital needed to do that maintenance is removed and CSX then has to put so much capital into getting the deferred maintenance resolved that their OR will "suddenly" return to being over 100,.  That will happen because the old adage pay now or pay more later applies to deferred maintenance.  Prime example is the NEC of Amtrak.

One way this problem can be resolved is requiring companies to somehow place deferred maintenance into the OR costs calculation.  How? Unknown but certain costs of track surfacing, signal upgrades, loco replacements, etc  per track mile might be one way?  That is even if not completed still in costs?  Maybe revenue ton miles per track section as well?

 

In 1968, the glorious Penn Central had an OR of 83.62, with years of deferred maintenance.  Your logic escapes me.

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Posted by ctsper on Tuesday, February 5, 2019 7:41 AM

Actually the UP post is one of the easiest to read that I've seen.  It is a bit frightening as a stock holder to see that UP has not erned the total return to us since 2014; its also interesting that the real reason for all the borrowing is stock buy back which is of course the way senior exectives keep their compensation high both in incentives and stock bonuses.  And for the economy as a whole they are far from the only corporation doing this.  Big Short anyone.

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Posted by ctsper on Tuesday, February 5, 2019 7:47 AM
Funny the Port has reported record TEUs for the past 2 years.
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Posted by BaltACD on Monday, October 21, 2019 6:11 PM

Never too old to have a happy childhood!

              

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Posted by Juniata Man on Monday, October 21, 2019 7:31 PM

Doubtless off to wreck another company.  The job of an "activist investor" is never done.

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Posted by JPS1 on Wednesday, October 30, 2019 11:31 AM

blue streak 1
 Here it means that routine track maintenance is being put off.  So now CSX will have deferred maintenance costs to build up . 

Overall CSX’s capital expenditures for property, plant, and equipment (PP&E) are down 9.7 percent for the 19 quarters ended September 30, 2019.  They range from a low of approximately $2 billion in 2017 to a high of $2.5 billion in 2015. 
 
YTD 2019 the company has spent $2.3 billion on PP&E.  If the rate of spend continues through the end of the year, it could top $3 billion. 
 
A 9.7 percent swing in capital expenditures, especially when the spend is on the up tick for the current year, does not indicate the company is not maintaining its infrastructure properly.
 
The company probably has increased the spend on PP&E in 2019 because its cash flows from operations through the first nine months are up 55 percent over 2018.  Moreover, they are up 113 percent for the 19 quarters ended September 30, 2019. 
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Posted by n012944 on Wednesday, October 30, 2019 11:59 AM

blue streak 1

 Here it means that routine track maintenance is being put off.   

That does not seem to be true from my seat.

An "expensive model collector"

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Posted by rrnut282 on Wednesday, October 30, 2019 6:32 PM

Euclid

 

 
rrnut282
What does PSR give the customer? Less consistancy.

 

  Please explain what this means and why it is so.

 

 

Well, in the post above mine, that I replied to said this,

Unloading containers there was successfully promoted as giving a day or two earlier arrival in Chicago, a premium service.  But then PSR started leaving them sitting on the dock for days because the train was maxed out.

I don't think that needs much explaination, but if you insist...  As a shipper, I worked to get my 100 container shipment to Halifax on the implied promise that it would be in Chicago (or where ever) a day or two faster than other options.  Image how I feel when only 80 or so of my containers show up.  Now I have a logistical nightmare of expediting/re-routing a part of my shipment that I had already arranged (and presumably paid for.)  What did PSR get me, a headache and endless phone tag and frustration. 

Shippers who reliably shipped 85-car unit trains were told no more, even if there was a contract still in effect.  Now each car has to be billed separately and probably at a higher price.  Instead of zipping through stations, my shipment now goes over the hump like every other loose-car shipment.  Pay more, get less service.   This is a fictional account based upon some of the PSR 'tenets.'  YMMV

Mike (2-8-2)

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