BaltACDYou get what you pay for - that goes to both the customer and to the company that employs the work force. Customers always think they get overchaged and company's always think their work force is over paid. What a pyramid to build good customer relations upon!
Customers always think they get overchaged and company's always think their work force is over paid.
What a pyramid to build good customer relations upon!
- PDN.
Really they do. BNSF had 2 major mainlines washed out 2 days ago in Iowa and Missouri one on the Owattuna Subdivision the other on the Marcilne Subdivison. Both are already repaired and back in service. UP is still struggling to put the KC to St Louis line back into service. BNSF is not a follower of PSR UP is.
Euclid BaltACD Without massed manpower, Moms' Nature put the carrier down for the count in a world where time is money. PSR in Nature times raises cost exponentially - ... Regardless of how railroads account for extreme weather costs, Rick Paterson, in the linked article, says that railroads with PSR recover from weather setbacks quicker than railroads without PSR. From the article based on ideas of Rick Paterson:
BaltACD Without massed manpower, Moms' Nature put the carrier down for the count in a world where time is money. PSR in Nature times raises cost exponentially - ...
Without massed manpower, Moms' Nature put the carrier down for the count in a world where time is money.
PSR in Nature times raises cost exponentially - ...
Regardless of how railroads account for extreme weather costs, Rick Paterson, in the linked article, says that railroads with PSR recover from weather setbacks quicker than railroads without PSR.
From the article based on ideas of Rick Paterson:
Who?
Never too old to have a happy childhood!
“CSX is arguably the best-running railroad in North America right now,” Paterson says, noting that the CSX service composite is currently 41% higher than its historic average. “Hunter Harrison cuts the merchandise network over to PSR without apparently telling anybody, including his own operating people,” Paterson says. “But as usual, he was right and everything worked out and all was forgiven.” PSR railroads are more resilient and have provided the most consistent service, Paterson says, singling out Canadian Pacific as the steadiest performer. Service suffered at all of the Class I railroads during the frigid winter of 2013-14, Paterson notes, but since then the non-PSR railroads experienced deeper, more prolonged, and more frequent service problems. It’s good news that six of the seven Class I railroads are adopting PSR, Paterson says. After a pair of hurricanes last year, for example, CSX bounced back quickly while NS velocity sank to its lowest levels since the meltdown after the Conrail split two decades ago.”
No matter how you try and change how you account for the costs it all has to come out of that same revenue stream. The only saving factor if your using a contractor is when they are not doing anything for your company your not paying them. However when they are the costs add up fast. Hedge funds forget that for every dollar going out there needs to be more than that coming in.
zardoz BaltACD PSR in Nature times raises cost exponentially - contractors don't come cheap, especially when they know they have you by the attachments. So in addition to the cost of repairing damage there is the cost of a stopped rail line. Those expenses go in a different accounting column, therefore they are not shown counting against the PSR 'savings'.
BaltACD PSR in Nature times raises cost exponentially - contractors don't come cheap, especially when they know they have you by the attachments. So in addition to the cost of repairing damage there is the cost of a stopped rail line.
Those expenses go in a different accounting column, therefore they are not shown counting against the PSR 'savings'.
No matter how you internally allocate the expenses - they all end up in the bottom line. Of course the Hedge Fund theives will take theirs off the top.
BaltACDPSR in Nature times raises cost exponentially - contractors don't come cheap, especially when they know they have you by the attachments. So in addition to the cost of repairing damage there is the cost of a stopped rail line.
Shadow the Cats ownerThen the problem becomes what do they do whenever a flooding event like today happens. The BNSF lost both the old Santa Fe and and BN lines west of Galesburg to flooding in both Iowa and Missouri. What do you think a PSR railroad can do when they have cut everything to the bone. BNSF already has repaired or replaced the lost track on the Santa Fe and the old BN is expected up tomorrow. Why they have the resources to power through multiple issues that CSX or CP can't stand up to anymore in manpower.
There is only one recourse to the damage Mother Nature inflicts on a railroad - be that rain or snow - MANPOWER in mass quantities. Without massed manpower, Moms' Nature put the carrier down for the count in a world where time is money.
PSR in Nature times raises cost exponentially - contractors don't come cheap, especially when they know they have you by the attachments. So in addition to the cost of repairing damage there is the cost of a stopped rail line.
EuclidMy point is that when I first started reading the article, I thought the person quoted was going to rip into PSR. But he is actually in favor of it.
I would opine that PSR, in and of itself, isn't necessarily a bad thing. The problem has been that it's been tainted by the hedge funds, etc, who seem to think that if getting rid of one of something is a good idea because it saves money, then getting rid of two must be even better, even if that's the spare that's going to bail you out when things go sour.
Larry Resident Microferroequinologist (at least at my house) Everyone goes home; Safety begins with you My Opinion. Standard Disclaimers Apply. No Expiration Date Come ride the rails with me! There's one thing about humility - the moment you think you've got it, you've lost it...
Shadow the Cats ownerWhat do you think a PSR railroad can do when they have cut everything to the bone.
Well, I don't think they should cut everything to the bone. Neither does the person who is featured in the article. Apparently he believes that PSR is a good thing, and that it does not require cutting everything to the bone, even though some companies may do that. He advises that companies do not spread themselves too thin precisely because they need reserves to stand up to climate related emergencies.
My point is that when I first started reading the article, I thought the person quoted was going to rip into PSR. But he is actually in favor of it.
Then the problem becomes what do they do whenever a flooding event like today happens. The BNSF lost both the old Santa Fe and and BN lines west of Galesburg to flooding in both Iowa and Missouri. What do you think a PSR railroad can do when they have cut everything to the bone. BNSF already has repaired or replaced the lost track on the Santa Fe and the old BN is expected up tomorrow. Why they have the resources to power through multiple issues that CSX or CP can't stand up to anymore in manpower.
Regarding the article:
On the face of it, analyst Rick Paterson seems to imply that the penny pinching, a derogatory term, is caused by PSR. He says this: “The problem is that Class I railroads, mindful of Wall Street’s focus on the operating ratio, try to perfectly match crew and power resources with their current traffic levels, Paterson says. And that leaves railroads with no margin for error.”
Thus, at first glance, he seems to be referring to Wall Street conspiring to get a foothold in the management of a railroad to cut cost and loot the savings for the gain of investors, as has been discussed continuously on this forum. And that also seems to be the thrust of this thread.
But I don’t think he is saying that. Instead, he sees the perfectly matching of crew and power resources with traffic levels as a good thing for the company rather than a damaging theft of company wealth. However, he does caution that this precise matching of crews to traffic can leave an operation too lean, and thus unable to cope with sudden contingencies such as severe weather events.
Then he offers an example of climate change potentially causing the kind of upheaval that sneaks up on “railroads with no margin for error.”
But then, he says this: “PSR railroads are more resilient and have provided the most consistent service, Paterson says, singling out Canadian Pacific as the steadiest performer."
ns145 Electroliner 1935 And now, CSX says its manifest traffic is growing because of BETTER service. Is this disproving all the hand wringing over the negative effects of PSR? Could all the naysayers be wrong? Or is CSX doing something right? Please tell me. If CSX's service levels are so great, then why are their YTD intermodal units down 6.4%, while NS' are up 0.6%? And CSX's comps are more favorable than NS'! Manifest traffic is far less sensitive to service levels (good or bad) than intermodal is. Want to know CSX's real secret as to why their service metrics are so high? Their 1st quarter 2019 revenue ton-mile stats are lower than they were in 2016 (50.4 billion vs. 51.2 billion, respectively). They are the only Class I railroad with negative revenue and gross ton-mile growth between 2016 and 2018. Dwell time and average train speeds improve amazingly well when you empty out the railroad.
Electroliner 1935 And now, CSX says its manifest traffic is growing because of BETTER service. Is this disproving all the hand wringing over the negative effects of PSR? Could all the naysayers be wrong? Or is CSX doing something right? Please tell me.
And now, CSX says its manifest traffic is growing because of BETTER service. Is this disproving all the hand wringing over the negative effects of PSR? Could all the naysayers be wrong? Or is CSX doing something right? Please tell me.
If CSX's service levels are so great, then why are their YTD intermodal units down 6.4%, while NS' are up 0.6%? And CSX's comps are more favorable than NS'! Manifest traffic is far less sensitive to service levels (good or bad) than intermodal is.
Want to know CSX's real secret as to why their service metrics are so high? Their 1st quarter 2019 revenue ton-mile stats are lower than they were in 2016 (50.4 billion vs. 51.2 billion, respectively). They are the only Class I railroad with negative revenue and gross ton-mile growth between 2016 and 2018. Dwell time and average train speeds improve amazingly well when you empty out the railroad.
If Lonegro had any remaining self respect - it is no wonder he jumped the CSX ship with what Foote is reporting.
Surely with the problems being prolonged this long, Becky is getting black and blue by now...
CSX's CFO jumps ship!
https://www.progressiverailroading.com/csx_transportation/news/Lonegro-departs-CSX-Boone-named-interim-CFO--57669
UlrichFor some reason the biggest proponents of PSR believe it has to be implemented quickly.. probably a more gradual change would work better as it would be less of a shock to the system as a whole. Instead of shuttering all the hump yards... shutter one or two.. get used to the adjustment.. and then go from there. Let customers and employees adjust. Pushing PSR through fast is like telling an out of shape 280 lb 55 year old to run six miles because exercise has proven benefits.
The reason it has to be done quickly is before the money can be used to benefit the railroad instead of the waiting sharks that are looting the money. Bank robbery is not successful when it drags out over time.
For some reason the biggest proponents of PSR believe it has to be implemented quickly.. probably a more gradual change would work better as it would be less of a shock to the system as a whole. Instead of shuttering all the hump yards... shutter one or two.. get used to the adjustment.. and then go from there. Let customers and employees adjust. Pushing PSR through fast is like telling an out of shape 280 lb 55 year old to run six miles because exercise has proven benefits.
jeffhergertAs long as they can announce 'record' profits and a low OR every quarter, they'll be happy.
Perhaps the trade war will put a dent in the IM business, and then the railroads will have to go begging for business.
tree68I suspect that railroad management finds, once the initial gloss of PSR wears off (or the profit-taking investors lose interest), that they need to keep that "middle ground" traffic, too, in order to maintain long term viability. And perhaps even some low end traffic.
Ulrich zugmann Ulrich Running longer trains is obviously more efficient than running shorter ones so long as other factors like service and safety aren't adversely affected. But when you combine two trains and need three crews to get it to its destination... Probably wouldn't make sense to combine the two trains then. PCR is fine provided (like anything else) it isn't carried to an illogical extreme. Cutting costs to the bone makes no sense when doing so causes customers to leave and revenues to fall.
zugmann Ulrich Running longer trains is obviously more efficient than running shorter ones so long as other factors like service and safety aren't adversely affected. But when you combine two trains and need three crews to get it to its destination...
Ulrich Running longer trains is obviously more efficient than running shorter ones so long as other factors like service and safety aren't adversely affected.
But when you combine two trains and need three crews to get it to its destination...
Probably wouldn't make sense to combine the two trains then. PCR is fine provided (like anything else) it isn't carried to an illogical extreme. Cutting costs to the bone makes no sense when doing so causes customers to leave and revenues to fall.
Bingo! We have a winner!
Our PSR propaganda talks about securing appropriate business. One can assume(*) that there is inappropriate business. One can also assume(*) that appropriate business would be business that is relatively cheap to handle, i.e. doesn't require a lot of switching. Manifest business requires switching. If they can get rid of as much of it as possible, they look at all the things they can eliminate. Such as yards (maybe even routes), engines, rolling stock, and people. Even though they can make money off that business, I guess they feel they'll be better off by operating a reduced, balanced network. As long as they can announce 'record' profits and a low OR every quarter, they'll be happy.
Jeff
(*) Recognizing the consequences of assuming anything.
Anymore I'm beginning to think it should stand for Stupidity Shameful Suppar Slovonley and some other things I can't list here while remaining PG rated.
UlrichProbably wouldn't make sense to combine the two trains then. PCR is fine provided (like anything else) it isn't carried to an illogical extreme. Cutting costs to the bone makes no sense when doing so causes customers to leave and revenues to fall.
The "S" in PSR does not stand for sense.
It's been fun. But it isn't much fun anymore. Signing off for now.
The opinions expressed here represent my own and not those of my employer, any other railroad, company, or person.t fun any
Mantle Ridge and their ilk are based on illogical extremes so as to fleece their victims.
"Penny pinching" is not only tied to freight cars and PSR. The "service" issue is also tied to the railroads as stewards of the lands they operate over and being good corporate citizens. Other parts of the railroad organizations, like Real Estate & Contract are getting depopulated to the point that timelyness and attention to detail is taking a huge beating. If you are trying to cross a railroad with a utility or place a public or private road crossing, you are seeing huge delays caused by a lack of staff (qualified or not) handling the requests and checking to see if the requests meet minimum standard. Shoving the work off to a contractor or consultant often isn't the answer either (competency issue compounded by the ethics of the low bid)...There is a built-up frustration with the railroads that is going to wind up with state** and federal mandates to make the railroads more responsive* and timely in dealing with utilities and non-shippers trying to deal with railroads. Communication is breaking down and it is pretty clear that the beancounter mentality is at the heart of it simply because it is out of touch, relying solely on a spreadsheet that is never looked up from.
(*) does not absolve the utility engineers, municipal and county people from the reckless behaviour that has been around for years near railroads with last minute applications, design blunders/ guessing, and a fundamental difference in design concept (like casing of pipelines, AREMA vs. ASCE, risk management, contract vs. easement, etc.)
(**) Minnesota and Iowa have enacted legislation that will probably be challenged at STB at some point. (state vs federal regulatory control)
Perhaps where PSR fails is in its emphasis on cost saving over generating revenue. IMHO, PSR assumes a constant income, thus any cost savings will ramp up net profit.
There is also the factor wherein a given type of traffic doesn't generate enough profit. I think we've discussed that the railroads would prefer to dump that traffic, going instead for the high ROI stuff.
I suspect that railroad management finds, once the initial gloss of PSR wears off (or the profit-taking investors lose interest), that they need to keep that "middle ground" traffic, too, in order to maintain long term viability. And perhaps even some low end traffic.
UlrichRunning longer trains is obviously more efficient than running shorter ones so long as other factors like service and safety aren't adversely affected.
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