If you've always wanted to start a shortline.....

[Anonymous]

QUOTE: Originally posted by futuremodal

Interesting thread. Some comments...

1. Why a shortline? Shortlines are usually contractually mandated to get all their traffic and have their share of the revenue dictated by the former Class I owner, e.g. you are captive. Which would be fine, except now you start to realize why the Class I gave up on the line in the first place - low traffic levels, terminal consolidation, etc. Why do you think the former owner will effectively want to reverse course and refocus on that traffic?

2. But if you are committed to such a dream, try to find a shortline that has access to quasi-unit train potential, e.g. a coal mine, a large wheat growing area, etc., or that has access to a transload alternative to interchange with a Class I, e.g. a barge port, or best yet both. If you can originate and terminate a good portion of your traffic base potential in the form of multiple car lots at a time, you will have as good a shot as any for success because then you can control part of your own business destiny, not the Class I connection.

3. Also, look for lines that have the potenial to become at least a secondary mainline in the future, and not just a dead end line. You remember the Washington Central? They bought the ex-NP Cascade line through the Yakima Valley to run as a shortline, then about 10 years later BN decided they might need that line again as a secondary main to the Stevens Pass and Columbia Gorge routes, and ended up paying WC a lot more to take it back than they sold it for in the first place. Needless to say, the WC owners ended up with quite a capital gain!

4. Take a page from the Watco Companies and try to pawn off as much of the infrastructural responsibility as possible onto the local and/or state governments (while retaining operating rights). The more you can absolve yourself of needless liability, the better off your chances of success.

5. For those still interested in all or parts of abandoned mainlines, take a good look at the ex-Milwaukee PCE. That grade is probably the best potential for rebuild in the nation, because it offers the easiest prospect of rebuilding a new east-west transcon with all that international trade potential. By all means, if you can get your hands on parts of that property go for it, even if you have no immediate plans to actually start up a shortline or regional. There is a growing national awareness for just how usefull it is to have new rail capacity available in the next few decades to capture both domestic and international trade growth, and there is no other ex-Class I gradient with as good a profile and geographic proximity to market optimization as the PCE.

6. Finally, if you want in of the ground floor of what it is like to be involved in a new rail project, start investing in the DM&E. That'll give you a first hand taste of all the particulars you would have to go through in starting up your own railroad.

I have to admit that, for once, I don't completely disagree with FM.

That said, I don't entirely agree with him either.

1. Why a short line?

It is the only place you can really have your own business in the railroad business that has any chance of longevity. You can run a real railroad. You can have a better life than is possible working for a Class 1. How many jobs on a Class 1 can be 9 to 5 or so monday thru friday, not many and by the time you can hold them you probably have more than 25 on the job. Traffic can be grown with good marketing and good service.

2. Are you committed to the dream?

Well, you'd better be because when it gets bad there isn't the backup of the Class 1 to babysit for you. Locomotive break down? No power room to call for mechanical help. Maybe the mechanic can come help you, but you need to be capable of basic troubleshooting on your own. You'll need to be capable of pretty much all the basics. Having an engineer's license, a conductor's qualification, a track inspector's qualification and some basic mechanical knowledge is a good start. A little business savvy, some legal knowledge, knowledge of handling employees and some spare cash will help a lot. Maximum personal commitment is an absolute.

Would it be nice to have unit trains, sure, but such lines don't grow on trees and most have too much traffic to be spin off candidates unless there is something seriously wrong with them such as environmental issues or HUGE maintenance costs due to many bridges, tunnels, curves or other features that greatly increase the costs of operations and maintenance. It is always worth looking, because there is an occasional opportunity which has great potential. Of course, remember, there are many bigger and more experienced short line groups looking for lines too and a new player has little chance.

3. Look for a Secondary Main Line.

Not a bad idea, but the Class 1s are on to this one. Very few such sales have happened lately. Where they have the Class 1s have used paper barriers or lease agreements to restrict any flow of overhead traffic. Recently, most Class 1s have been leasing lines to short line operators under some pretty onerous terms so not only will there be no capital gains (the Class 1 gets to keep that along with title to the line) but the short line has to pay for not only maintenance but capital improvements to an agreed level. Take a look at the "Heads I win, Tails you lose" article in the December 2004 Transportation Newsletter at the following law firm site for an example:

http://www.wbsk.com/

4. Pawning off infrastructure on localities has the nasty side effect of giving those localities far too much control over the short line. Also, you don't lose much liability this way, most municipalities are very good at making the short line shoulder all the responsibility through agreements for indemnity and contribution. Besides, joint and several liability usually means that hoped for liability savings are illusory at best.

5. Buying an old mainline with no track on the extreme speculation that it will someday be relaid is crazy. Even if it does work, the new railroad would simply pay you fair market value based upon the condemnation of the property. Your appreciation factored over the time you wold need to hold the property would be extremely low even if a major RR took an interest in such an uncertain and risky project today. As an example look at the many years it has take the DM&E to even get to the verge of a much smaller project as guidance. You can do much better buying bonds and clipping the coupons to say nothing of the stock market or simple real estate investments.

6. I wasn't aware that the DM&E was offering shares to the public, certainly it isn't mentioned on their website.

LC

[tormadel]

QUOTE: Originally posted by Limitedclear

QUOTE: Originally posted by tormadel

Indeed I have read it. I was just saying it was abit of a bore. My little family here has a savings of about $700 so I would say my dream is in the infant stage where it hasn't even learned to crawl yet. I'll keep working hard and crawling up the ladder. I will get there someday.

Well, since cash is an issue I'd suggest a job with a railroad where you can learn while you earn as I mentioned above. I'd look at T&E service as you can make pretty good money there and hopefully put some away. It will be difficult on the family but if you establish a seniority date early and get your RTC and Engineer training done ASAP you'll have decent seniority and should be able to hold a decent job. In your area I'd check with the Wisconsin Southern and perhaps the UP and\or CN if they have terminals close by. At least that way you will get hired out and get your training paid for by the RR. I have no idea what you make at Dominos but I am certain the RR is better.

LC

Oh for sure. I've been trying to keep tabs on W&S and CN they are the most local, UP or CP would be quite a decent move from here thou. Is T&E track and equipment service?

[tormadel]

QUOTE: Originally posted by Limitedclear

QUOTE: Originally posted by futuremodal

Interesting thread. Some comments...

1. Why a shortline? Shortlines are usually contractually mandated to get all their traffic and have their share of the revenue dictated by the former Class I owner, e.g. you are captive. Which would be fine, except now you start to realize why the Class I gave up on the line in the first place - low traffic levels, terminal consolidation, etc. Why do you think the former owner will effectively want to reverse course and refocus on that traffic?

2. But if you are committed to such a dream, try to find a shortline that has access to quasi-unit train potential, e.g. a coal mine, a large wheat growing area, etc., or that has access to a transload alternative to interchange with a Class I, e.g. a barge port, or best yet both. If you can originate and terminate a good portion of your traffic base potential in the form of multiple car lots at a time, you will have as good a shot as any for success because then you can control part of your own business destiny, not the Class I connection.

3. Also, look for lines that have the potenial to become at least a secondary mainline in the future, and not just a dead end line. You remember the Washington Central? They bought the ex-NP Cascade line through the Yakima Valley to run as a shortline, then about 10 years later BN decided they might need that line again as a secondary main to the Stevens Pass and Columbia Gorge routes, and ended up paying WC a lot more to take it back than they sold it for in the first place. Needless to say, the WC owners ended up with quite a capital gain!

4. Take a page from the Watco Companies and try to pawn off as much of the infrastructural responsibility as possible onto the local and/or state governments (while retaining operating rights). The more you can absolve yourself of needless liability, the better off your chances of success.

5. For those still interested in all or parts of abandoned mainlines, take a good look at the ex-Milwaukee PCE. That grade is probably the best potential for rebuild in the nation, because it offers the easiest prospect of rebuilding a new east-west transcon with all that international trade potential. By all means, if you can get your hands on parts of that property go for it, even if you have no immediate plans to actually start up a shortline or regional. There is a growing national awareness for just how usefull it is to have new rail capacity available in the next few decades to capture both domestic and international trade growth, and there is no other ex-Class I gradient with as good a profile and geographic proximity to market optimization as the PCE.

6. Finally, if you want in of the ground floor of what it is like to be involved in a new rail project, start investing in the DM&E. That'll give you a first hand taste of all the particulars you would have to go through in starting up your own railroad.

I have to admit that, for once, I don't completely disagree with FM.

That said, I don't entirely agree with him either.

1. Why a short line?

It is the only place you can really have your own business in the railroad business that has any chance of longevity. You can run a real railroad. You can have a better life than is possible working for a Class 1. How many jobs on a Class 1 can be 9 to 5 or so monday thru friday, not many and by the time you can hold them you probably have more than 25 on the job. Traffic can be grown with good marketing and good service.

2. Are you committed to the dream?

Well, you'd better be because when it gets bad there isn't the backup of the Class 1 to babysit for you. Locomotive break down? No power room to call for mechanical help. Maybe the mechanic can come help you, but you need to be capable of basic troubleshooting on your own. You'll need to be capable of pretty much all the basics. Having an engineer's license, a conductor's qualification, a track inspector's qualification and some basic mechanical knowledge is a good start. A little business savvy, some legal knowledge, knowledge of handling employees and some spare cash will help a lot. Maximum personal commitment is an absolute.

Would it be nice to have unit trains, sure, but such lines don't grow on trees and most have too much traffic to be spin off candidates unless there is something seriously wrong with them such as environmental issues or HUGE maintenance costs due to many bridges, tunnels, curves or other features that greatly increase the costs of operations and maintenance. It is always worth looking, because there is an occasional opportunity which has great potential. Of course, remember, there are many bigger and more experienced short line groups looking for lines too and a new player has little chance.

3. Look for a Secondary Main Line.

Not a bad idea, but the Class 1s are on to this one. Very few such sales have happened lately. Where they have the Class 1s have used paper barriers or lease agreements to restrict any flow of overhead traffic. Recently, most Class 1s have been leasing lines to short line operators under some pretty onerous terms so not only will there be no capital gains (the Class 1 gets to keep that along with title to the line) but the short line has to pay for not only maintenance but capital improvements to an agreed level. Take a look at the "Heads I win, Tails you lose" article in the December 2004 Transportation Newsletter at the following law firm site for an example:

http://www.wbsk.com/

4. Pawning off infrastructure on localities has the nasty side effect of giving those localities far too mach control over the short line. Also, you don't lose much liability this way, most municipalities are very good at making the short line shojulder all the responsibility through agreements for indemnity and contribution. Besides, joint and several liability usually means that hoped for liability savings are illusory at best.

5. Buying an old mainline with no track on the extreme speculation that it will someday be relaid is crazy. Even if it does work, the new railroad would simply pay you fair market value based upon the condemnation of the property. Your appreciation factored over the time you wold need to hold the property would be extremely low even if a major RR took an interest in such an uncertain and risky project today. As an example look at the many years it has take the DM&E to even get to the verge of a much smaller project as guidance. You can do much better buying bonds and clipping the coupons to say nothing of the stock market or simple real estate investments.

6. I wasn't aware that the DM&E was offering shares to the public, certainly it isn't mentioned on their website.

LC

1. Exactly LC. Plus there are a great many lines with traffic and earning potential that cannot be realized with the realities of overhead that class 1's must deal with. Kyle Railway is a good example. They do alot of grain business in the northern part of kansas that is alot of bulk work that doesn't pay alot individually. But they haul alot of it and do it far cheaper switching out all those small stops then the Class 1's would, so they origionate alot of traffic, but connecting class 1's benefit from the hauling of all that to processing plants and for shipment overseas at the ports (I do believe we stil export a great deal of our agricultural output in this country) Or say Wisconsin Central that actually solicited and made profit on pulpwood which was discussed as something big roads avoid as not worth it.

2. Which is the basis of my desire to broaden my knowledge, learn and License in as many different relevant trades as my brain will hold and not melt down. Phase 1 to study up myself while I work on convincing the wife that this is a good idea to get myself ready. (And also I figure the more knowledgeable I am the more promising prospect I become to my potential employers here) Phase 2 Certify myself through class's paid for the traditional college way or let the RR pay for it (we will see where the cards fall on that one) Phase 3 build up hands on knowledge, reputation, friends in the trade & cash. Phase 4 take the leap.

While I am not adverse to the bigger dream of the regional railway (as I think that's what you're hinting at) I think that would be more of a difficult <shall we say> dream to realize. As you can see my mentality is to take manageable chunks and goals. I would have to say that setting out with the first goal of reforgeing the Erie Lackawanna as a Class 2 regional would be a bit Napoleonic complex of me.

3. Look for a secondary mainline. This assumes that I am in this to get rich, and I am not. I would like to do well, but if I create my dream and it is successfull I wil defend it as if it were my child. Now perhaps if my holding company were to become something like rail american with multiple properties maybe I would sell some peices to realize the next bigger step. The Wisconsin Central being reborn was something that put a smile on my face, and them selling out to CN 15 (ish) years later offended me more then Metallica sueing napster (Metallica was able to make the big time with young people trading garage copies of they're music untill they got noticed so being against music sharing seems very hypicritcal to me.)

4. I have to agree with LC here. But dealing with government and truely with the other big companies (and probably the small ones too) is very much like a dance. Alot of give and take and watching you're back. Charisma is a big plus in these dealings to help you schmooze you're way, but you have to know what you're getting into so you dont' accidently screw yourself. This statement could be applied to the lease agreements with Class 1's or dealing with government. W&S had to wrangle for a few years to get the funding they needed from the state of wisconsin just to upgrade they're lines to 25mph class 2 standard. Partly to deal with increasing car weights and traffic. But, mostly due to the big seller to the policiticans for saftey. It will be a big step in reducing derailments, injuries and such.

5. Buying old mainline (and you're example of the pacific extension is probably one of the most applicable examples) should only be done if you intend to relay it yourself. Now like you say, alot of the big expensive nasty work was done by the CMSTP&P along time ago. But if you were to do this it would behoove you make improvements. More longer tunnels, reduce the curves and grades even further (if you're going to do it do it RIGHT). And after you've gotten Montana (From another thread here sounds like you might have a chance for help there) private investors and the US gov to help you fund what would have to be at LEAST a $100billion project let us know, we want to pin a medal on you and erect a statue in you're honor. This is not to say that I think it shouldn't be done just that it is only slightly easier to digest then the plan to go to Mars.

6. Go to work for the DM&E maybe (But that's to far away at the moment). And if they were selling stock the time to buy it would have been before the powder river project recieved approval. I'm sure the go ahead would have shot the value of the stock up alot.


On a side note, I like that Milwaukee & Northwestern name [8D].
And isn't it just too bad that we don't have much to say on this thread? <grin>

[Anonymous]

QUOTE: Originally posted by tormadel

QUOTE: Originally posted by Limitedclear

QUOTE: Originally posted by tormadel

Indeed I have read it. I was just saying it was abit of a bore. My little family here has a savings of about $700 so I would say my dream is in the infant stage where it hasn't even learned to crawl yet. I'll keep working hard and crawling up the ladder. I will get there someday.

Well, since cash is an issue I'd suggest a job with a railroad where you can learn while you earn as I mentioned above. I'd look at T&E service as you can make pretty good money there and hopefully put some away. It will be difficult on the family but if you establish a seniority date early and get your RTC and Engineer training done ASAP you'll have decent seniority and should be able to hold a decent job. In your area I'd check with the Wisconsin Southern and perhaps the UP and\or CN if they have terminals close by. At least that way you will get hired out and get your training paid for by the RR. I have no idea what you make at Dominos but I am certain the RR is better.

LC

Oh for sure. I've been trying to keep tabs on W&S and CN they are the most local, UP or CP would be quite a decent move from here thou. Is T&E track and equipment service?

Train & Engine Service (Conductors and Engineers)

LC

[tormadel]

Thanks LC. That was the other one I was going to say, I best not go to the casino today heh. Was kinda weird I got 5 topic reply notifications on that little note.

[tormadel]

Oh yes, and can someone explain to me how senority works? I have never had to deal with a union situation before.

[Anonymous]

QUOTE: Originally posted by tormadel

Oh yes, and can someone explain to me how senority works? I have never had to deal with a union situation before.

This is a subject that can and has filled several threads. You might want to try the search function on this site to learn more as well or even start a new thread on the subject if you can't learn what you want through the research.

Seniority like many things around the railroad can be complicated, but the important part is it is based upon a date or sometimes a series of dates. Different railroads choose the seniority date differently. For most it is the date you first are "on the property" working. Others use the date you take your physical for the job. You should find out how the date is determined for each railroad you apply to as that date will control what jobs you can hold. The difference of a day, or sometimes even hours or minutes can have a real impact. Most seniority rosters are slowly consolidating as the crafts are consolidated. For example, at one time there were rosters for trainmen and conductors. After the caboose was eliminated, on many Class 1s those rosters have been combined so each person has a single date, not one for each craft. Likewise, fireman's rosters have been combined into Locomotive Engineer rosters as the elimination of the fireman's job caused realignment. Now it is fairly common to have a trainman/conductor date and an engineer's date as most are still separate rosters, althougth most Class 1s are giving new hires a single "system" date.

Senority is woven into a complex weave with the labor - management relationship of the railroad you work for and is something that must be learned on the property as each has slightly different rules.

LC

[scooby1]

hey if you get a shoetline going,can I have a job

[tormadel]

I would like to say I was surprised that its complicated LC, but sadly I'm not surprised heh. And we'll have to see how it goes Scooby, you could win the lottery and found scooby snacks first who knows.

[MichaelSol]

QUOTE: Originally posted by Limitedclear
In my own humble experience it will literally take years for someone coming from the outside to penetrate the industry to the point where a Class 1 will seriously consider leasing or worse selling a line to an unknown. Anything they do offer, LOOK OUT, it is probably something all the "real" players have turned down.

Interesting. The guys that did come from outside the rail industry have noted that their advantages in the transactions were in the fact that they were able to view railroading without "the blinders," as one put it, that railroaders have about railroading. That's their viewpoint. After Nick Temple created the Washington Central out of a purchase from the BN and started making money at it, his famous quote was "I am now convinced, based on my experiences, that railroaders don't know how to run railroads. You have to be from outside that industry in order to do anything right." [Paraphrase] I am sure he was referring to the business side of things. That was before he sold the operation back to BN at an enormous profit.

At Montana Rail Link, Denny Washington of course had zero railroad experience when he decided to take a jump at creating Montana Rail Link. The advice he received on the proposition was interesting in light of the actual results. Railroad people generally thought he was out of his mind. There were a few key exceptions. His attorneys asked my opinion -- not in a consulting sort of way, but in a "having coffee" sort of way . I thought it would work notwithstanding key structural handicaps in the deal. I did not think it would be as successful as it was. The BNSF "Required Minimum Use" provision in the lease was a key to that, as was the unexpected loss of the Conoco pipeline which put considerable traffic on the rails between Missoula and Thompson Falls.

I can't agree that you need to go out and read magazines and books in order to know how to create a Shortline. For the most part, articles and books are not written by people who actually do these things.

A good business background and sound business judgment are key requisites. Those are more important than a railroad background. You can hire that experience.

Business judgment is something you can't hire -- the idea of risk analysis, personal comittment of funds, a reflexive sense of P&L and Balance sheet considerations, understanding the needs of the shippers, business revenue and cost drivers. Can you ask yourself the question, "where's the country going?" in relation to the location of the shortline. You have to be a bit of an economist, a historian, and a seer. That's the dreamer part. The dream has to be about the place you're at, not the railroad.

If you were to be serving Forest Products industries, you need to get a handle on business and pricing cycles in that industry. They're dramatic. Can your railroad survive those cycles? If you're going to serve a Wheat area, you need to know more about Wheat than the growers, much more.

You need to know how to play some "politics." You cannot overestimate the importance of having the kind of experience and personality to be able to sit down with a local shipper over a cup of coffee, to be able to go to Minneapolis and the VP at Cargill is glad to see you and calls you by your first name because you've been there before and left a good impression, and you can go up the State Capitol and talk to the Governor about the state's committment to rail transportation.

Stay away from the Operating Department guys. They don't know how to do any of that and so they consistently underestimate the importance of those things. All they can tell you is cost. And that's the easy part. What you really need to know has surprisingly little to do with actual "railroading". Perhaps more accurately, there is much more to "railroading" than tracks and engines. My specific advice is to go and talk to some Shortline operators. The ones I know would be glad to talk candidly about mistakes they made, and how the decision making process works.

The key barrier is capital. A useful paper on the topic was published by the Research and Traffic Group for the Canada Transportation Act Review project, February, 2001: Sustaining Capital Requirements for the Short Line Railway Industry. There are some useful numbers in there.

Best regards, Michael Sol

[zardoz]

QUOTE: Originally posted by MichaelSol
[ After Nick Temple created the Washington Central out of a purchase from the BN and started making money at it, his famous quote was "I am now convinced, based on my experiences, that railroaders don't know how to run railroads. You have to be from outside that industry in order to do anything right." [Paraphrase] I am sure he was referring to the business side of things. That was before he sold the operation back to BN at an enormous profit.

Just curious...do you have any idea of how well the BN did with the operation after they bought it back? Did the BN operate with their "business as usual" philosophy (the one they used before they sold it), or did they operate it in a similar fashion to how Mr. Temple ran it?

[Anonymous]

For what it's worth, DM&E is privately held, but if you've read the papers lately they are interested in investment partners if not actual stockholders.

On that PCE thing, a few years back after the Milwaukee retrenchment, there were pieces of the line that were bought up by regional business people with the intent of maintaining the option of reviving future operations. One guy bought the tracks from Avery to Haugen over St Paul Pass, while the local timber company bought the main from Avery to Plummer. Unfortunately for railfans (but not so unfortunate for the ones that bought the lines) the Forest Service went to court to force the sale of these ROW's to them so they could build a highway over the ROW from St Maries to Avery, create a new gravel road over the ROW from Avery to Pearson, and build the mountain bike trail from Pearson to Haugen over St Paul Pass. Too bad, but it should be noted that both buyers made significant capital gains, perhaps more in the short run than they ever could have hoped to make actually running a railroad. The difference for the one guy was that he wanted to eventually use the ROW as a bridge line for either BN or UP, which if it would have come to fruition really could have made him some money if he could have held out through the dry 80's and 90's until now.

Another good example of buying a former piece of mainline for future capital gains is the Montana Western (the former BN nee-NP section from Garrison to Silver Bow near Butte), which BNSF just bought back (ostensibly to keep UP and MRL from interchanging). Again, the original shortline owners were crying all the way to the bank. It is also interesting to note that the tracks over Homestake Pass are still in place and owned by BNSF, thought they haven't seen action in decades.

That's why it is not so far fetched that the ex-Milwaukee line from Lombard through Sixteenmile Canyon to the Harlowtown area would have made a good "rail banking" investment. If nothing else, you would have had a preferable route between Billings and Helena for BN/BNSF/MRL bridge traffic, since this ROW has superior gradient and alignment to the ex-NP line over Bozeman Pass.

Therefore, as much as the idea of owning and running a quaint shortline is to you, you should never discount the prospect of your shortline becoming part of a secondary main, especially today with current mainline capacity at the breaking point. That overhead revenue will trump anything you can make online.

[MichaelSol]

QUOTE: Originally posted by zardoz

QUOTE: Originally posted by MichaelSol
[ After Nick Temple created the Washington Central out of a purchase from the BN and started making money at it, his famous quote was "I am now convinced, based on my experiences, that railroaders don't know how to run railroads. You have to be from outside that industry in order to do anything right." [Paraphrase] I am sure he was referring to the business side of things. That was before he sold the operation back to BN at an enormous profit.

Just curious...do you have any idea of how well the BN did with the operation after they bought it back? Did the BN operate with their "business as usual" philosophy (the one they used before they sold it), or did they operate it in a similar fashion to how Mr. Temple ran it?

Didn't follow it very closely after that. Assumed it all had something to do with the Stampede Pass rebuilding.

QUOTE: Posted by futuremodal
Another good example of buying a former piece of mainline for future capital gains is the Montana Western (the former BN nee-NP section from Garrison to Silver Bow near Butte), which BNSF just bought back (ostensibly to keep UP and MRL from interchanging). Again, the original shortline owners were crying all the way to the bank. It is also interesting to note that the tracks over Homestake Pass are still in place and owned by BNSF, thought they haven't seen action in decades.

Odd historical facts. The line from Garrison to Butte was originally built by the OWR&N, as part of a project to build through Missoula, down Lolo Pass, and into the Palouse. After looking at the costs of the Lolo Pass tunnel project, the idea was abandoned, and NP got a long-term lease on the part of the line that was built. BN has ruthlessly exercised control of that lease to firmly keep Montana Rail Link out of Butte and away from the Union Pacific connection there. The line, however, does still technically belong to the OWR&N.

Best regards, Michael Sol

[tormadel]

Another good viewpoint you offer there Micheal. I am glad to have heard it from you. I agree that if you have money to back you then business accumen would indeed behoove you more then 30 years riding the rails. But I do think that a couple years in the trench's to give you some basic knowledge and understanding could not be bad. As well as some time in low or middle management ( I say that because I think at upper management it's more like any other company) you just need to keep you're mind open. Realize that there have been alot of mistakes because of old fashioned thinking (PennCentral and the recent faux pas in UP, CSX & NS) So new ideas and common sense could make all the difference in the world. As for roles in the company I wouldn't try to do everything myself ( I do have some management experiance and I know better then that) but I would multi-task some. I do not think LC is suggesting you do everything yourself, just that you need to understand whats going on when most anything comes at you unexpectedly. I would think of myself as the CEO and also one of the train crew(s). No not just to snatch hours from other people (got to keep the Union hounds off my back) but to help out. (Sounds kind of whacked out for the CEO to be permanent extra boarder eh?)

[tormadel]

It also sucks to hear the hold BNSF has on MRL. My partial memory I had thought BN had owned a share in MRL or something like that. As part of anyones plan to relay the coast extension should include taking over MRL to cut a good stretch of miles off the rebuild <muwhahahahaha, cough>

Of course this also could relate to the political savy part that was refered to. From what was posted in another thread about the government of montana it could be possible to get them to leveage against BNSF to make them let go.

[Anonymous]

It is all very well to come in from the outside, but unless you are in a Class 1 or large Class2 you had better have something to contribute and knowledge of how the RR works. The best way is to study it through educating yourself and to learn by living it. All the charts and diagrams in the world are useless if you don't understand how the business drives the finances.

Also, I'm not suggesting you should start the MRL as your first venture. You'll need to start a LOT smaller than that, unless you have some serious backers, which is unlikely unless you have significant real world RR experience. Investors only follow management teams that have a good chance to succeed in my experience. If the investor doesn't see it that way, I don't want them to back me, that is just a lawsuit waiting to happen.

LC

[tormadel]

The actual experiance brings together all the peices of what you've learned. Book learning help to keep you from feeling completely lost, but the hands on allows you to refine yourself.

[Anonymous]

ok i want to know how much a train engine costs?

[Anonymous]

QUOTE: Originally posted by powderkeg

ok i want to know how much a train engine costs?

Now you're thinkin'.

All depends upon type, size, age etc.

A GP9 goes for $45,000 to $100,000 for starters...

LC

[tormadel]

Ah yes. But there is more to consider then just what roadswitcher can you get for the least money. It's also about the bang for you're buck. Northern Plains has a handfull of GP9's but has twice as many GP35's. Stating that it was the best buy for the horsepower they could get, and much better with they're heavy grain drags then the 9's. But would GP38's work better for the lower maintence by lack of the turbochargers? Is there a benefit worth haveing from the new -3 specs on some of these lease locomotives? Adding new microprocessor tech to tried and true models.

Now given that even 2nd hand locomotives are not "The Goodwill store" kinds of bargains <usually> is there any point in eventually considering brand new power? I have to say I have a distaste for railpower products new units. But, GE and EMD both have alot of cost saving through maintence and fuel consumption in they're new product lines. Could it be possible to work with either or both on a non-class 1 model? A B-B or even C-C scaled down version of they're current top of the lines? Perhaps stick with DC traction motors (AC sounds great on paper but not so good for stop and go small railroad action) and 12 cylinders instead of 16. (As a side admission I do not even know if a roots blown version of a 710 engine is possible, but it would be ruled out on GE's 4 cycle engines).

[tormadel]

Also, is it a big price difference between an unmodified GP9 and say a paducah built GP10?

I've seen GP38-3's, did anyone try fooling with the new traction technology with a GP9 rebuild? or would it even help? heh. Always new spins on old reliable tech.

[Anonymous]

QUOTE: Originally posted by tormadel

Also, is it a big price difference between an unmodified GP9 and say a paducah built GP10?

I've seen GP38-3's, did anyone try fooling with the new traction technology with a GP9 rebuild? or would it even help? heh. Always new spins on old reliable tech.

Most GP10s were remanufactured from GP7s and GP9s in the early 70s so they are getting pretty long in the tooth. There is not much of a price difference these days, but then again there are very few unmodified GP9s left. Almost all still running have at least been rewired and had their original controls and braking systems updated and been low nosed.

Given the age and condition of the GP9s most folks wisely have decided not to reconfigure GP9s with traction control. There have been some remanufacturing efforts such as the IC GP11s that added Dash 2 electronics to GP9s... If you don't already own it kalmbachs 4th Edition of the Shortline Guide has a lot about the various rebuilding programs...

LC

[tormadel]

Interesting stuff [8D]

[tormadel]

Yeah I had looked at that book at the local hobby store. But, it didn't look like it had much in it more then the one my father had in the 80's. Just didn't seem as "updated" as I wanted. But I could be wrong ,I'll take another look at it.

[Junctionfan]

What kind of basic transloading opportunities would there be? Would that make the shortline more profitable and more attractive for investors?

[Anonymous]

QUOTE: Originally posted by Junctionfan

What kind of basic transloading opportunities would there be? Would that make the shortline more profitable and more attractive for investors?

Huh??? Are you in the right thread Andrew?

LC

[tormadel]

I think we may have confused him LC, I'm sorry.

[Anonymous]

QUOTE: Originally posted by tormadel

I think we may have confused him LC, I'm sorry.

No problem, that's just Andrew, you'll get used to him...lol...

LC

[tormadel]

hehe [8D]

[Anonymous]

There are times I'd really like to start a new short line...

Today is not one of those days...

LC