OvermodAny sort of LCL service on the old Railway Express Agency model is DOA for railroads; the valid point Backshop made being only one reason. Even some of the LTL 'specialists' restrict service to the relatively 'granular' endpoints of 'terminals' or crossdock facilities (the latter effectively being used as 'cross dock' from LTL provider to the client picking up). What NS is doing is, to me, little different from what UP stopped doing with the cold service to Rotterdam: getting enough aggregate LTL loading from various originating points to make up economic carload moves, then releasing the carload at one or more established crossdock facilities to whatever LTL or other providers will do 'last mile' (which of course may be considerable actual 'miles') most cost-effectively.
Any sort of LCL service on the old Railway Express Agency model is DOA for railroads; the valid point Backshop made being only one reason. Even some of the LTL 'specialists' restrict service to the relatively 'granular' endpoints of 'terminals' or crossdock facilities (the latter effectively being used as 'cross dock' from LTL provider to the client picking up).
What NS is doing is, to me, little different from what UP stopped doing with the cold service to Rotterdam: getting enough aggregate LTL loading from various originating points to make up economic carload moves, then releasing the carload at one or more established crossdock facilities to whatever LTL or other providers will do 'last mile' (which of course may be considerable actual 'miles') most cost-effectively.
While it's complicated to figure out exactly what service reliability and 'precision scheduled' timing is necessary for various carloads in transit, and there's some fun looking at Amazon-style ways to decrease cost and to automate handling in the necessary transloading operations, I don't think it is rocket science to determine potentially profitable niches or to design services to fulfil them. More specifically I can see how even assigning multiple dock stops to single cars might be practical in assisting 'local' LTL providers at either end of an overall trip, especially if more and more emphasis on day drayage trips and 'home every night' becomes observed.
Backshop I think building up the needed infrastructure would be cost prohibitive. All the freight houses, team tracks and even sidings have been razed or pulled up. That's a lot of money that would need to be spent to figure out if "build it and they will come" will work in this case. Railroads biggest advantage over other types of transportation is in heavy and bulk items. They should concentrate on that.
I think building up the needed infrastructure would be cost prohibitive. All the freight houses, team tracks and even sidings have been razed or pulled up. That's a lot of money that would need to be spent to figure out if "build it and they will come" will work in this case. Railroads biggest advantage over other types of transportation is in heavy and bulk items. They should concentrate on that.
As common carriers they need to be open to serving a broad base of customers with diverse needs. The STB has recently made that very point..i.e. that railroads need to take their common carrier responsibilities more seriously or risk reregulation. Cherry picking bulk freight and refusing freight that doesn't yield a 58% OR is not an option.
There's no need for "build it and they will come"..best way to go about it would be to buy into it by purchasing an LTL carrier (or carriers). Instead of spending 33 billion on a railroad merger, buy one or more regional or even national LTL carriers.
I think NS is on the right path although they have to move faster. The pace of change has accelerated..Amazon and Tesla were nowhere a decade ago..that's the pace it needs to move at. They've got to make this happen in months not years or risk becoming completely irrelevant.
greyhounds LCL in boxcars is great. I’ve said it before, and I’ll say it again. The US railroads didn’t abandon LCL service, they were driven out of it by the idiot government regulators. Railroads such as the New York Central tried very hard to keep their LCL business but they were thwarted by the regulators. And that’s a fact that I can back up with all kinds of research and data. There are different ways to handle LCL/LTL. But in this case, they’re using local trucks to pick up several smaller shipments from several shippers and bring them to a consolidation center. At this center the shipments are sorted (“Cross Docked”) into a rail car going toward the destination on an expedited train. At the destination terminal the rail car is unloaded into local delivery trucks. This method works well. A boxcar used in this service is essentially an intermodal car. The truckers generally have to gather and cross dock too. A boxcar used this way has an advantage on an over the road truck because it can handle much more volume and weight. And hanging a boxcar or two on a train has very low marginal costs. If the railroad provides consistent, reasonably fast service they should have an advantage. The main problem I see is that they are going into competition with a major customer. FedEx is the largest LTL carrier in the US by revenue. They ship a lot by rail. You’ve got to think about it big time before you go into competition with a major customer.
That's a good point. But FedEx like the other true LTLs, becomes less competitive on the heavier LTL business... 5000 lbs and up, and also the ugly freight..longer than 20 ft..oddly shaped etc. And having a supplier who is also a competitor is pretty much par for the course in this industry..FedEx itself hires competitor carriers on a regular basis.
tree68When UPS was young, that was how you sent stuff that had to be there in a couple of days - much faster that the post office could do it. FedEx was for stuff that had to be there tomorrow. Nowadays, they're all about the same.
FedEx was for stuff that had to be there tomorrow.
Nowadays, they're all about the same.
Post Office under DeJoy is slower by 3 days to a week.
Never too old to have a happy childhood!
When UPS was young, that was how you sent stuff that had to be there in a couple of days - much faster that the post office could do it.
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...
MP173 Union Pacific tried it in the 80s with purchase of Overnite Express...a very well run LTL carrier. It didnt work out. The NS LCL program really intrigues me. Would like to know more about it. I called NS and left a voice mail...no reply. Ed
Union Pacific tried it in the 80s with purchase of Overnite Express...a very well run LTL carrier. It didnt work out.
The NS LCL program really intrigues me. Would like to know more about it. I called NS and left a voice mail...no reply.
Ed
I knew Overnite would come up as it always does in this type of discussion. But that was 40 years ago, and Overnite wasn't a top notch carrier . The Wright Brothers also crashed their Flyer numerous times before finally achieving a sustained flight..yet we fly today.
Overshadowed by all the hype surrounding the CN/CP - KCS merger proposal is NS's foray into LCL (almost front page news in the latest Trains issue). Finally someone gets it! As most manufacturers are small(ish) most don't pump out truckload or carload volumes.. most ship in 1 skid to 5 skid increments, a market that the railroads have all but ignored now for 50 plus years.
Maybe the next step is the purchase of a large LTL carrier. We've done it in Canada a couple of years back with CN's purchase of TransX. Imagine Norfolk Southern buying a well run and well managed LTL outfit like Old Dominion.. the sky would be the limit. And maybe that would be better and faster than attempting to grow that business organically.
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