futuremodal wrote:..they are using their monopoly power to try and "nudge" trucking companies to use COFC over TOFC...
Dave what is your estimate of the railroads market share, % of units, in the intercity movment of dry fans. 100%?, 10% or 1%.
bobwilcox wrote: futuremodal wrote:..they are using their monopoly power to try and "nudge" trucking companies to use COFC over TOFC... Dave what is your estimate of the railroads market share, % of units, in the intercity movment of dry fans. 100%?, 10% or 1%.
Are those "dry fans" made in China or the USA?
futuremodal wrote: bobwilcox wrote: futuremodal wrote:..they are using their monopoly power to try and "nudge" trucking companies to use COFC over TOFC... Dave what is your estimate of the railroads market share, % of units, in the intercity movment of dry fans. 100%?, 10% or 1%. Are those "dry fans" made in China or the USA?
Gee Dave I guess you know the answer to the question but do not want to admit once again you are blowing smoke. Perhaps you are more interested in spelling than railroading. Frankly I am not interested in childish posts about spelling and I think few others posting here are either.
greyhounds wrote: Gee, you'd think a dentist hit a nerve. I mean look at that response. It's unbelievable. I guess the truth hurts. And, as usual, Dave thinks he knows more than everybody - including the people at the Federal Reserve who write papers on economic issues. If someone (in this case, the Surface Transportation Board) disagrees with him, he dismisses them as "hacks". And, as usual again, he rewrites history to suit his needs. A clear example of his revision of history is when he references "forcing the BNSF to reduce its rates from two decades ago". What the STB said was that the raillroads had achieved a productivity gains over a 20 year period and passed those productivity gains through to their customers because they clearly operate in a competitive environment. Dave changes this around to something that happened 20 years ago instead of being an ongoing process over a 20 year period. He rants about trucking further to rail terminals. In doing so he ignors the absolute fact that before rail deregulation as much as 39% of Montana wheat was trucked much further distances to the Snake River barge terminals. The efficiency improvements of the BNSF have reduced trucking distances, not increased them as he falsely claims.
Gee, you'd think a dentist hit a nerve. I mean look at that response. It's unbelievable. I guess the truth hurts.
And, as usual, Dave thinks he knows more than everybody - including the people at the Federal Reserve who write papers on economic issues.
If someone (in this case, the Surface Transportation Board) disagrees with him, he dismisses them as "hacks". And, as usual again, he rewrites history to suit his needs.
A clear example of his revision of history is when he references "forcing the BNSF to reduce its rates from two decades ago". What the STB said was that the raillroads had achieved a productivity gains over a 20 year period and passed those productivity gains through to their customers because they clearly operate in a competitive environment. Dave changes this around to something that happened 20 years ago instead of being an ongoing process over a 20 year period.
He rants about trucking further to rail terminals. In doing so he ignors the absolute fact that before rail deregulation as much as 39% of Montana wheat was trucked much further distances to the Snake River barge terminals. The efficiency improvements of the BNSF have reduced trucking distances, not increased them as he falsely claims.
Well, explain to us how the federales can so blatantly contradict themselves? One agency states absurdly that railroads operate in a competitive environment, then reps from the MFR state that 30% of rail shippers are captive. You cannot have captive customers and a competitive environment at the same time. Clearly, the STB report is weighted by AAR influence, not by classical economists who argue intuitively that an integrated rail system is a natural monopoly. If railroads "clearly" have competition, then clearly there'd be more than one rail service provider for every stretch of track, because the only way to have clear intramodal competition is to have more than one operator on the only rail connection most rail shippers have.
This is the same guy who promotes the concept of "aggregation" when espousing the advantages of railroads, but conviently forgets about that key concept when stating his belief that trucks are competition for railroads. Memo to Strawbridge: Trucks do not haul aggregated units, they only haul single, sometimes double, and rarely triple units. Ergo, a mode that cannot aggregate into large consists is no competition for the mode that can.
And despite Ken's allusion to throngs of trucks hauling grain to Lewiston from the nation's grain fields, the fact remains that it is the individual farmers who now have to truck their grain farther and farther to the nearest railhead across the nation, not just Montana. There's a world of difference between farmer owned trucks and standard OTR truckers. Rarely if ever did you have OTR outfits taking the grain straight from the farm to Lewiston. Most of the time, the farmer would truck via his own rig to the nearest local elevator, and it is the elevator operators who would decide whether to ship their grain onward via carload rail or OTR truckload to Lewiston. Then we get *deregulation* and UP and BN start abandoning the lines to the elevators in favor of 26 and 52 car shuttle train facilities, then they stop service to the shuttle facilities in favor of consolidated 110 unit train terminals. While all this is happening, the railroads move from 220k to 264k to 286k cars, while at the same time lobbying the feds to restrict increases in truck GVW. What you get is the loss of the intermediate elevators the OTR's used to patronize, and the OTR's aren't going to shorthaul themselves from the remaining elevators to the unit train loaders, neither are they going to drive out in the farmer's fields and take the grain from farm to unit train facility, sot the farmer ends up having to buy his own road worthy trucks just to get his grain from farm to unit train facility. Despite Ken's *expertise* on farming and trucking in Montana and the PNW, the farmer generally doesn't have the time to drive his own OTR rig from farm to Lewiston if he's farming in Montana or North Dakota.
Get it through your head, Ken - today's farmers absolutely do have to truck their own grain in their own rigs exponentially farther today than 20 years ago, and this is entirely due to the railroads. I should know - we farm, our neighbors all farm, and this is the reality that Ken ignores.
TimChgo9 wrote: But, what I would like to know, (with whatever honesty can be put forth) is what are, say MichaelSol's Strawbridge's, futurmodal's or TomDiehl's basis for the apparent expertise here.. are you guys railroad types, accountants, finance managers, or just very well versed in this particular arena? I am not taking shots at anyone, just real curious that's all. I have read many threads on this site, with the above taking a major part, so I am just wondering, that's all.
But, what I would like to know, (with whatever honesty can be put forth) is what are, say MichaelSol's Strawbridge's, futurmodal's or TomDiehl's basis for the apparent expertise here.. are you guys railroad types, accountants, finance managers, or just very well versed in this particular arena? I am not taking shots at anyone, just real curious that's all. I have read many threads on this site, with the above taking a major part, so I am just wondering, that's all.
In addition to what I've posted on my profile (click on the user name in any entry to see their profile), I also conduct shop tours at the East Broad Top Railroad's 19th century style overhead shaft driven shops. Over the past 5 years, the Friends of the East Broad Top have been performing stabilization and repair work on the shops building as volunteer workers. Most of my knowledge of the current railroad scene comes from reading and what sounds logical from a business point of view. I also have a very accurate BS detector and with years of that experience, it's easy for me to sort out the substance from the "fluff and fog."
bobwilcox wrote: futuremodal wrote: bobwilcox wrote: futuremodal wrote:..they are using their monopoly power to try and "nudge" trucking companies to use COFC over TOFC... Dave what is your estimate of the railroads market share, % of units, in the intercity movment of dry fans. 100%?, 10% or 1%. Are those "dry fans" made in China or the USA? Gee Dave I guess you know the answer to the question but do not want to admit once again you are blowing smoke. Perhaps you are more interested in spelling than railroading. Frankly I am not interested in childish posts about spelling and I think few others posting here are either.
Who said anything about spelling? I proofread your post, and you have no spelling errors - every single word is spelled correctly! That deserves a big A+!
Now, as for asking a question completely out of context.............
futuremodal wrote: greyhounds wrote: Gee, you'd think a dentist hit a nerve. I mean look at that response. It's unbelievable. I guess the truth hurts. And, as usual, Dave thinks he knows more than everybody - including the people at the Federal Reserve who write papers on economic issues. If someone (in this case, the Surface Transportation Board) disagrees with him, he dismisses them as "hacks". And, as usual again, he rewrites history to suit his needs. A clear example of his revision of history is when he references "forcing the BNSF to reduce its rates from two decades ago". What the STB said was that the raillroads had achieved a productivity gains over a 20 year period and passed those productivity gains through to their customers because they clearly operate in a competitive environment. Dave changes this around to something that happened 20 years ago instead of being an ongoing process over a 20 year period. He rants about trucking further to rail terminals. In doing so he ignors the absolute fact that before rail deregulation as much as 39% of Montana wheat was trucked much further distances to the Snake River barge terminals. The efficiency improvements of the BNSF have reduced trucking distances, not increased them as he falsely claims. Well, explain to us how the federales can so blatantly contradict themselves? One agency states absurdly that railroads operate in a competitive environment, then reps from the MFR state that 30% of rail shippers are captive. You cannot have captive customers and a competitive environment at the same time. Clearly, the STB report is weighted by AAR influence, not by classical economists who argue intuitively that an integrated rail system is a natural monopoly. If railroads "clearly" have competition, then clearly there'd be more than one rail service provider for every stretch of track, because the only way to have clear intramodal competition is to have more than one operator on the only rail connection most rail shippers have. This is the same guy who promotes the concept of "aggregation" when espousing the advantages of railroads, but conviently forgets about that key concept when stating his belief that trucks are competition for railroads. Memo to Strawbridge: Trucks do not haul aggregated units, they only haul single, sometimes double, and rarely triple units. Ergo, a mode that cannot aggregate into large consists is no competition for the mode that can. And despite Ken's allusion to throngs of trucks hauling grain to Lewiston from the nation's grain fields, the fact remains that it is the individual farmers who now have to truck their grain farther and farther to the nearest railhead across the nation, not just Montana. There's a world of difference between farmer owned trucks and standard OTR truckers. Rarely if ever did you have OTR outfits taking the grain straight from the farm to Lewiston. Most of the time, the farmer would truck via his own rig to the nearest local elevator, and it is the elevator operators who would decide whether to ship their grain onward via carload rail or OTR truckload to Lewiston. Then we get *deregulation* and UP and BN start abandoning the lines to the elevators in favor of 26 and 52 car shuttle train facilities, then they stop service to the shuttle facilities in favor of consolidated 110 unit train terminals. While all this is happening, the railroads move from 220k to 264k to 286k cars, while at the same time lobbying the feds to restrict increases in truck GVW. What you get is the loss of the intermediate elevators the OTR's used to patronize, and the OTR's aren't going to shorthaul themselves from the remaining elevators to the unit train loaders, neither are they going to drive out in the farmer's fields and take the grain from farm to unit train facility, sot the farmer ends up having to buy his own road worthy trucks just to get his grain from farm to unit train facility. Despite Ken's *expertise* on farming and trucking in Montana and the PNW, the farmer generally doesn't have the time to drive his own OTR rig from farm to Lewiston if he's farming in Montana or North Dakota. Get it through your head, Ken - today's farmers absolutely do have to truck their own grain in their own rigs exponentially farther today than 20 years ago, and this is entirely due to the railroads. I should know - we farm, our neighbors all farm, and this is the reality that Ken ignores.
Who cares? If these wheat farmers can't compete with their counterpart in China, Austrailia or Alberta they can sell the farm and get a job in Seattle. Why should they be bailed out by the BNSF or we taxpayers.
?
bobwilcox wrote: futuremodal wrote: greyhounds wrote: Gee, you'd think a dentist hit a nerve. I mean look at that response. It's unbelievable. I guess the truth hurts. And, as usual, Dave thinks he knows more than everybody - including the people at the Federal Reserve who write papers on economic issues. If someone (in this case, the Surface Transportation Board) disagrees with him, he dismisses them as "hacks". And, as usual again, he rewrites history to suit his needs. A clear example of his revision of history is when he references "forcing the BNSF to reduce its rates from two decades ago". What the STB said was that the raillroads had achieved a productivity gains over a 20 year period and passed those productivity gains through to their customers because they clearly operate in a competitive environment. Dave changes this around to something that happened 20 years ago instead of being an ongoing process over a 20 year period. He rants about trucking further to rail terminals. In doing so he ignors the absolute fact that before rail deregulation as much as 39% of Montana wheat was trucked much further distances to the Snake River barge terminals. The efficiency improvements of the BNSF have reduced trucking distances, not increased them as he falsely claims. Well, explain to us how the federales can so blatantly contradict themselves? One agency states absurdly that railroads operate in a competitive environment, then reps from the MFR state that 30% of rail shippers are captive. You cannot have captive customers and a competitive environment at the same time. Clearly, the STB report is weighted by AAR influence, not by classical economists who argue intuitively that an integrated rail system is a natural monopoly. If railroads "clearly" have competition, then clearly there'd be more than one rail service provider for every stretch of track, because the only way to have clear intramodal competition is to have more than one operator on the only rail connection most rail shippers have. This is the same guy who promotes the concept of "aggregation" when espousing the advantages of railroads, but conviently forgets about that key concept when stating his belief that trucks are competition for railroads. Memo to Strawbridge: Trucks do not haul aggregated units, they only haul single, sometimes double, and rarely triple units. Ergo, a mode that cannot aggregate into large consists is no competition for the mode that can. And despite Ken's allusion to throngs of trucks hauling grain to Lewiston from the nation's grain fields, the fact remains that it is the individual farmers who now have to truck their grain farther and farther to the nearest railhead across the nation, not just Montana. There's a world of difference between farmer owned trucks and standard OTR truckers. Rarely if ever did you have OTR outfits taking the grain straight from the farm to Lewiston. Most of the time, the farmer would truck via his own rig to the nearest local elevator, and it is the elevator operators who would decide whether to ship their grain onward via carload rail or OTR truckload to Lewiston. Then we get *deregulation* and UP and BN start abandoning the lines to the elevators in favor of 26 and 52 car shuttle train facilities, then they stop service to the shuttle facilities in favor of consolidated 110 unit train terminals. While all this is happening, the railroads move from 220k to 264k to 286k cars, while at the same time lobbying the feds to restrict increases in truck GVW. What you get is the loss of the intermediate elevators the OTR's used to patronize, and the OTR's aren't going to shorthaul themselves from the remaining elevators to the unit train loaders, neither are they going to drive out in the farmer's fields and take the grain from farm to unit train facility, sot the farmer ends up having to buy his own road worthy trucks just to get his grain from farm to unit train facility. Despite Ken's *expertise* on farming and trucking in Montana and the PNW, the farmer generally doesn't have the time to drive his own OTR rig from farm to Lewiston if he's farming in Montana or North Dakota. Get it through your head, Ken - today's farmers absolutely do have to truck their own grain in their own rigs exponentially farther today than 20 years ago, and this is entirely due to the railroads. I should know - we farm, our neighbors all farm, and this is the reality that Ken ignores. Who cares? If these wheat farmers can't compete with their counterpart in China, Austrailia or Alberta they can sell the farm and get a job in Seattle. Why should they be bailed out by the BNSF or we taxpayers?
Who cares? If these wheat farmers can't compete with their counterpart in China, Austrailia or Alberta they can sell the farm and get a job in Seattle. Why should they be bailed out by the BNSF or we taxpayers?
The only area where US farmers "can't" compete globally with other ag nations is in the cost of transportation from farm to outbound port. Clearly, this puts the onus on the railroads and the federal overseers of said system. Since we taxpayers are giving a huge indirect subsidy to BNSF and the others via their government granted monopolies, perhaps we should start at the root of the problem and first eliminate the ongoing anti-trust exemption the railroads enjoy, and use our historic anti-trust oversight to force competition onto the rail system.
Once that's done and put in motion, we'll start talking about reducing farm subsidies.
bobwilcox wrote: Who cares? If these wheat farmers can't compete with their counterpart in China, Austrailia or Alberta they can sell the farm and get a job in Seattle. Why should they be bailed out by the BNSF or we taxpayers. ?
Whoa, Nellie.
Per ton costs of shipment, BNSF*:
Captive Farm Products .. $43.64
Non-captive Farm Products..$18.44
How could a captive wheat shipper "compete" with a non-captive USA shipper, let alone shippers in "China, Austrailia or Alberta" ?
The non-captive shipper is getting the "bail out," not the captive shipper.
You've got it backwards.
Why?
*This is from Rail Price Advisor (lst Quarter, 2003). According to RPA, the “per ton” information is calculated from the 2001 Surface Transportation Board Revenue Shortfall Allocation Methodology" (RSAM) study.
MichaelSol wrote:[ Per ton costs of shipment, BNSF*: Captive Farm Products .. $43.64 Non-captive Farm Products..$18.44
JSGreen wrote: MichaelSol wrote: Per ton costs of shipment, BNSF*: Captive Farm Products .. $43.64 Non-captive Farm Products..$18.44 Is that for the same distance...or what would the rate be for ton/mile, not just per ton?I would expect it to cost more to go further....so not having the distance, or some assurance about it being a quote for the same distance, the numbers are not impressive....
MichaelSol wrote: Per ton costs of shipment, BNSF*: Captive Farm Products .. $43.64 Non-captive Farm Products..$18.44 Is that for the same distance...or what would the rate be for ton/mile, not just per ton?I would expect it to cost more to go further....so not having the distance, or some assurance about it being a quote for the same distance, the numbers are not impressive....
MichaelSol wrote: Per ton costs of shipment, BNSF*: Captive Farm Products .. $43.64 Non-captive Farm Products..$18.44
Is that for the same distance...or what would the rate be for ton/mile, not just per ton?I would expect it to cost more to go further....so not having the distance, or some assurance about it being a quote for the same distance, the numbers are not impressive....
Well, a set of captive shipper costs vs non-captive shipper costs, in several categories, shows the captive shipper pays a substantially higher cost per ton. There is no evidence that captive shippers are located further distances from their natural market than non-capitve shippers, but rather that captivity, not distance, is the determining factor.
The use of a ton-mile statistic would show that the more distant shippers pay less, typically, than short haul.
futuremodal wrote: oltmannd wrote: futuremodal wrote: n012944 wrote: futuremodal wrote: Two things regarding the NS slide show: First, this is an NS slide show, so it's going to be favorable to NS's side of the story, right? (insert cynical smilie here) OK I will give you that we should take the NS slide show with a grain of salt, however should we also take the numbers given by Mr. Sol with a grain of salt too? They were studies that were paid for by shippers who claim to be captive. Why is it that certain people on this board use numbers from studies done by "captive" shippers as examples, yet when other sides are shown, be it from an independent goverment office like the GAO or the railroads, we are told to take them with a grain of salt? Two different things going on here, not necessarily related. My comments on the NS slide show is more pertaining to the usual corporate slide show characterization, e.g. such are presented to show only a favorable aspect of the company's decisions, e.g. they are not going to present the downsides. It is similar to the stuff we get on the corporate PR Newswire items - it's "rah rah" stuff, not a cost/benefit analysis. It's hard to justify a claim that NS's domestic double stack program is taking freight off the highways, soley because the gain in domestic double stack exceeds the gains presented by the trucking industry. Did we also see the trends in NS's boxcar loadings in that slide show? Is it possible that the upward trend in domestic double stack is inversely correlated with a downward trend in boxcar loadings over the same time period? If so, do ya think NS is going to tell us? I got yer carloading stats right here! It really wouldn't hurt you to look at ALL the slides and maybe even read the text, you know! It isn't always all happy talk. http://www.nscorp.com/nscorphtml/speech06/dws072606/dws072606.pdf (slide 6 - broken out by major commodity group. This is all non-intermodal stuff. Includes grain and slab unit trains. Does not include coal.) Up 2% over all, similar to industrial production. Note that chemical is down 7% YOY. This is all tank car traffic and is not generally converted to intermodal.. And automotive is down 3%. Ag down 1% 2Q. (Slide 3) Non-coal revenue growth is lowest in intermodal (Slide 5) Wait a minute! Domestic double stack down 9%, truckload up 11%! (Slide 10) Weren't you all telling me about how domestic double stack is growing at the expense of OTR? From these stats it looks as if the only shift is from doms to trailers, aka still no shift of highway traffic to rail.
oltmannd wrote: futuremodal wrote: n012944 wrote: futuremodal wrote: Two things regarding the NS slide show: First, this is an NS slide show, so it's going to be favorable to NS's side of the story, right? (insert cynical smilie here) OK I will give you that we should take the NS slide show with a grain of salt, however should we also take the numbers given by Mr. Sol with a grain of salt too? They were studies that were paid for by shippers who claim to be captive. Why is it that certain people on this board use numbers from studies done by "captive" shippers as examples, yet when other sides are shown, be it from an independent goverment office like the GAO or the railroads, we are told to take them with a grain of salt? Two different things going on here, not necessarily related. My comments on the NS slide show is more pertaining to the usual corporate slide show characterization, e.g. such are presented to show only a favorable aspect of the company's decisions, e.g. they are not going to present the downsides. It is similar to the stuff we get on the corporate PR Newswire items - it's "rah rah" stuff, not a cost/benefit analysis. It's hard to justify a claim that NS's domestic double stack program is taking freight off the highways, soley because the gain in domestic double stack exceeds the gains presented by the trucking industry. Did we also see the trends in NS's boxcar loadings in that slide show? Is it possible that the upward trend in domestic double stack is inversely correlated with a downward trend in boxcar loadings over the same time period? If so, do ya think NS is going to tell us? I got yer carloading stats right here! It really wouldn't hurt you to look at ALL the slides and maybe even read the text, you know! It isn't always all happy talk. http://www.nscorp.com/nscorphtml/speech06/dws072606/dws072606.pdf (slide 6 - broken out by major commodity group. This is all non-intermodal stuff. Includes grain and slab unit trains. Does not include coal.) Up 2% over all, similar to industrial production. Note that chemical is down 7% YOY. This is all tank car traffic and is not generally converted to intermodal..
futuremodal wrote: n012944 wrote: futuremodal wrote: Two things regarding the NS slide show: First, this is an NS slide show, so it's going to be favorable to NS's side of the story, right? (insert cynical smilie here) OK I will give you that we should take the NS slide show with a grain of salt, however should we also take the numbers given by Mr. Sol with a grain of salt too? They were studies that were paid for by shippers who claim to be captive. Why is it that certain people on this board use numbers from studies done by "captive" shippers as examples, yet when other sides are shown, be it from an independent goverment office like the GAO or the railroads, we are told to take them with a grain of salt? Two different things going on here, not necessarily related. My comments on the NS slide show is more pertaining to the usual corporate slide show characterization, e.g. such are presented to show only a favorable aspect of the company's decisions, e.g. they are not going to present the downsides. It is similar to the stuff we get on the corporate PR Newswire items - it's "rah rah" stuff, not a cost/benefit analysis. It's hard to justify a claim that NS's domestic double stack program is taking freight off the highways, soley because the gain in domestic double stack exceeds the gains presented by the trucking industry. Did we also see the trends in NS's boxcar loadings in that slide show? Is it possible that the upward trend in domestic double stack is inversely correlated with a downward trend in boxcar loadings over the same time period? If so, do ya think NS is going to tell us?
n012944 wrote: futuremodal wrote: Two things regarding the NS slide show: First, this is an NS slide show, so it's going to be favorable to NS's side of the story, right? (insert cynical smilie here) OK I will give you that we should take the NS slide show with a grain of salt, however should we also take the numbers given by Mr. Sol with a grain of salt too? They were studies that were paid for by shippers who claim to be captive. Why is it that certain people on this board use numbers from studies done by "captive" shippers as examples, yet when other sides are shown, be it from an independent goverment office like the GAO or the railroads, we are told to take them with a grain of salt?
futuremodal wrote: Two things regarding the NS slide show: First, this is an NS slide show, so it's going to be favorable to NS's side of the story, right? (insert cynical smilie here)
Two things regarding the NS slide show: First, this is an NS slide show, so it's going to be favorable to NS's side of the story, right? (insert cynical smilie here)
OK I will give you that we should take the NS slide show with a grain of salt, however should we also take the numbers given by Mr. Sol with a grain of salt too? They were studies that were paid for by shippers who claim to be captive. Why is it that certain people on this board use numbers from studies done by "captive" shippers as examples, yet when other sides are shown, be it from an independent goverment office like the GAO or the railroads, we are told to take them with a grain of salt?
Two different things going on here, not necessarily related. My comments on the NS slide show is more pertaining to the usual corporate slide show characterization, e.g. such are presented to show only a favorable aspect of the company's decisions, e.g. they are not going to present the downsides. It is similar to the stuff we get on the corporate PR Newswire items - it's "rah rah" stuff, not a cost/benefit analysis. It's hard to justify a claim that NS's domestic double stack program is taking freight off the highways, soley because the gain in domestic double stack exceeds the gains presented by the trucking industry. Did we also see the trends in NS's boxcar loadings in that slide show? Is it possible that the upward trend in domestic double stack is inversely correlated with a downward trend in boxcar loadings over the same time period? If so, do ya think NS is going to tell us?
I got yer carloading stats right here! It really wouldn't hurt you to look at ALL the slides and maybe even read the text, you know! It isn't always all happy talk.
http://www.nscorp.com/nscorphtml/speech06/dws072606/dws072606.pdf
(slide 6 - broken out by major commodity group. This is all non-intermodal stuff. Includes grain and slab unit trains. Does not include coal.)
Up 2% over all, similar to industrial production. Note that chemical is down 7% YOY. This is all tank car traffic and is not generally converted to intermodal..
And automotive is down 3%. Ag down 1% 2Q. (Slide 3)
Non-coal revenue growth is lowest in intermodal (Slide 5)
Wait a minute! Domestic double stack down 9%, truckload up 11%! (Slide 10)
Weren't you all telling me about how domestic double stack is growing at the expense of OTR? From these stats it looks as if the only shift is from doms to trailers, aka still no shift of highway traffic to rail.
"Domestic" is mostly old-line IMC business in RR controlled trailers (and NACS containers). This is mostly TOFC business. "Truckload" includes domestic stack business (JB Hunt, Schneider, etc) and the containers they lease from the RR.
Automotive is down because of Ford's woes. Ford is NS's #1 customer. Ag is mostly grain.
Slide 5 is revenue per unit. Intermodal is "only" up 8% becuase of traffic mix. Stack traffic is up (low cost, low rates, but high margin). IMC TOFC is down (very high cost, medium rates, very low margin)
Slide 10 shows net of + 4000 between domestic (RR controlled equipment) and truckload (primarily shipper owned equipment) YTD.
Another intersting fact is that paper shipments are being diverted from truck to boxcars! Even as paper production is getting soft, (NS chemical shipments down), paper shipment in box cars is increasing.
-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/)
riprap wrote:So, FM, are you arguing that it was a mistake to deregulate the RR's? Given some of your other musings on these threads, I wouldn't think so, but would re-regulating the RR's be of a piece with the "open access" I think you're calling for?
No, I'm arguing that regulation would have been less likely if railroads back in the day's before regulation had internally addressed the intramodal competitive issues - whether that be separate entities operating infrastructure and transporter operations, or having the railroads simply allow each other access over each other's lines to serve key terminals and gateways, or perhaps something else.
But they didn't, and the result was regulation.
As for today, I would favor strong anti-trust action rather than some form of pre-Staggers regulation. Allow DM&E and KCS full access over both UP and BNSF out west where true intramodal competition is lacking, do the same back East to some extent.
Or do the AT&T style breakup of infrastructure from transporter operations.
Just do whatever it takes to get some true intramodal competition going.
greyhounds wrote:He rants about trucking further to rail terminals. In doing so he ignors the absolute fact that before rail deregulation as much as 39% of Montana wheat was trucked much further distances to the Snake River barge terminals. The efficiency improvements of the BNSF have reduced trucking distances, not increased them as he falsely claims.
Sounds like a lot of sour grapes to me. Its seems that Dave believes that the railroads should provide a social service for farmers, as opposed to the profit seeking buisness that it is.
An "expensive model collector"
n012944 wrote: Sounds like a lot of sour grapes to me. Its seems that Dave believes that the railroads should provide a social service for farmers, as opposed to the profit seeking buisness that it is.
His post said nothing of the sort.
Average revenue per car/unit
Consumer products ...$972.00
Industrial products ... $1,836
Coal ......................... $1,094
Agricultural products .. $2,326
Source: BNSF Railway 2005 Annual Report.
From Rail Price Advisor, 1st Q, 2003:
Cost per ton to ship......CXS ...NS..... BN..... UP
Captive Farm Products $29.86 $21.18 $43.64 $36.47
Non-captive Farm ....... $14.45 $ 9.72 $18.44 $16.20
Captive Coal ...............$15.85 $15.79 $18.43 $18.70
Non-captive Coal ..........$ 7.67 $ 7.25 $ 7.79 $ 8.30
Captive Chemicals .......$32.83 $36.08 $48.43 $42.18
Non-captive Chemicals .$15.88 $16.56 $20.46 $18.73
Captive Lumber ............$30.87 $26.51 $58.70 $55.97
Non-captive Lumber .... $14.94 $12.17 $24.80 $24.86
Captive Pulp Paper .......$38.70 $37.41 $59.92 $55.07
Non-captive Pulp Paper $18.73 $17.17 $25.32 $24.46
Captive Competitive
BN 238.1% 100.6%
CSX 232.9% 112.7%
NS 237.7% 109.1%
UP 239.8% 106.5%
The following from General Accountability Office, 'Freight Railroads: Preliminary Observations on Rates, Competition, and Capacity Issues' released June 21, 2006:
"Grain rates initially declined from 1985 to 1987, but then diverged from industry trends and increased, resulting in a net 9 percent nominal increase by 2004." ...
"Our preliminary analysis indicates that this overall change in traffic traveling over 300 percent R/VC can be seen in certain states and commodities. For example, 39 percent of grain originating in Montana and 20 percent of coal in West Virginia traveled over 300 percent R/VC in 2004. This represents a significant increase from 1985, when 14 percent of grain in Montana and 4 percent of coal in West Virginia traveled over 300 percent R/VC." ...
"There is widespread agreement the rate relief process is inaccessible to most shippers and does not provide expeditious handling and resolution of complaints. The process is expensive, time consuming and complex, and, as a result, several shipper's organizations told us that it is unlikely they would ever file a rate case. Since 2001, only 10 cases have been filed, and these cases took between 2.6 and 3.6 years--an average of 3.3 years per case--to complete. In addition, while STB does not keep records of the cost of a rate case, shippers we interviewed agreed that the process can cost approximately $3 million per litigant." ...The following from Rail Price Advisor (op. cit.):
Revenue percentage of all traffic, percent from captive
Farm Products 7.5% 34.2%
Metallic Ores 1.2% 46.6%
Coal 21.1% 43.6%
Ordinance or Accessories 0.2% 73.0%
Chemicals 21.1% 65.9%
Petroleum or Coal Products 3.0% 49.1%
Stone, Clay and Glass Products 3.2% 40.6%
Fabricated Metal Products 1.8% 30.2%
MichaelSol wrote: greyhounds wrote: He rants about trucking further to rail terminals. In doing so he ignors the absolute fact that before rail deregulation as much as 39% of Montana wheat was trucked much further distances to the Snake River barge terminals. The efficiency improvements of the BNSF have reduced trucking distances, not increased them as he falsely claims. "Prior to deregulation" two things were happening in Montana, the Milwaukee Road was withdrawing, and export sales had kicked up with a second round of Russian wheat sales. In 1979, the Milwaukee's efforts to discourage traffic were becoming highly "successful". There was already a national grain car shortage because of high export sales, and BN was unable to replace both the Milwaukee fleet and meet the additional demand. According to one estimate, the railcar fleet available to Montana farmers to ship was 8,000 grain cars short, which was an enormous shortfall. Pat Williams, Representative, Letter to Neil Goldschmidt, Secretary of Transportation, September 12, 1979.Trucks made up the difference, but were used on the shortest haul possible -- to the Columbia River system barge facilities. This was because of the inability of the rail system to haul the wheat, not because trucks provided a "better" alternative at the time.Did BN "efficiencies" after deregulation reduce the need for trucks?In January, 1980, the United States imposed a grain embargo on exports to the Soviet Union. Wheat exports gradually declined thereafter even after the embargo was lifted, falling 22 percent in the 1983/84 season alone.Accordingly, the rail fleet was able to handle demand after deregulation and during that time period. Trucking naturally fell off as a result.
greyhounds wrote: He rants about trucking further to rail terminals. In doing so he ignors the absolute fact that before rail deregulation as much as 39% of Montana wheat was trucked much further distances to the Snake River barge terminals. The efficiency improvements of the BNSF have reduced trucking distances, not increased them as he falsely claims.
Well, again Mr. Sol is revising history.
Trucks held a signficant part of the Montana wheat business through the mid 1980's, contrary to what he says. In 1981 (with the Soviet embargo) they moved 32.7% of the wheat - 32,788,838 of 100,230814 bushels. So about one of every three grains of wheat moved by truck in a market Sol claims is "captive" to rail. It obviously isn't.
By 1986 things hadn't changed much - the trucks still had 30.8% of the market - 24,874,916 of 80,676,713 bushels. But then ...
The truck share began to decline significantly, down to 5.4% in 2004 - only 6,539,537 of 120.537,824 bushels.
http://wbc.agr.mt.gov/Buyers_Processors/Grain_movement/mtmovement_truckrail_bu.pdf
Now if we were to accept the teachings of Mr. Sol, we would accept the belief that the railroad holds its shippers captive and is able to charge them exhorbitant rates which causes great economic harm to these poor decent American Farmers.
But that doesn't make sense. The railroad would not gain business by increasing its charges to the wheat producers. And it certainly gained business. The railroad certainly would not have gained this business if it was charging too much in the face of a viable alternative, trucking. No, the railroad would only gain business if it reduced the costs of using its services to move the grain.
What happend was that the railroad improved its efficiency, and passed the cost savings along. (They had to pass it along, there was all this truck competition.) This caused greater use of rail transportaiton and less use of truck transportation. In other words, the Burlington Northern brought the unit grain train to Montana in the 1980's.
http://www.ugpti.org/pubs/pdf/SP139.pdf#search=%22montana%20wheat%20truck%201980%22
Of course, Mr. Sol and FM Dave will falsely contend that the unit trains actually drove overall rail system costs up and simply shifted cost to the poor farmer by making them truck further to a unit train terminal. But that doesn't make any sense either.
The "poor farmers" still had that truck alternative and they wouldn't have shifted from truck to rail in the tremendous way they did if overall rail use cost had gone up. The BN (BNSF) reduced the costs of moving wheat out of Montana (they did the same for a lot of commodities throughout their service area.) These cost reductions were largely passed on to their customers - and we all benifit. (please see previously cited Minneapolis Federal Reserve Bank paper.)
As I've said before, the Montana Legislature should be passing resolutions praising the BNSF for how the railraod has helped the state's economy. But there aren't many votes to be gained doing that.
I hope I've provided enough citations.
greyhounds wrote: Now if we were to accept the teachings of Mr. Sol, we would accept the belief that the railroad holds its shippers captive and is able to charge them exhorbitant rates which causes great economic harm to these poor decent American Farmers.
"If you tell a lie big enough and keep repeating it, people will eventually come to believe it."
Joseph Goebbels
bobwilcox wrote: greyhounds wrote: Now if we were to accept the teachings of Mr. Sol, we would accept the belief that the railroad holds its shippers captive and is able to charge them exhorbitant rates which causes great economic harm to these poor decent American Farmers. "If you tell a lie big enough and keep repeating it, people will eventually come to believe it." Joseph Goebbels
"Everything You Know is Wrong!" Just listen: http://www.firesigntheatre.com/albums/eykiw1.mp3
Wow! Bob just zinged Ken with this little axiom! Way to go Bob!
Oh, I'm sure Bob in his smarmy way was trying to aid Ken's shakey POV, but it sure backfired.
Ken just keeps on telling the Big AAR Lie, and some eventually buy into it. "Why, there's plenty of competition for railroads, that's why they pass on the gains from efficiency to their customers." What a load of c**p.
You notice Ken never uses the phrase "intramodal competition", never acknowledges global price competition, never acknowledges global events that shape commodity price and demand, never gives a whit of credence to the concept of the shut down price.
Because he doesn't know jack about these more onerous and obvious variables. He lives in a childish world of simple ignorance, because to acknowledge the larger truths blows his little hobby right out of the water.
More later.
greyhounds wrote:http://www.ugpti.org/pubs/pdf/SP139.pdf#search=%22montana%20wheat%20truck%201980%22
True, and in this case, confusing export wheat, which went to the Columbia River if by truck, with "wheat hauled by truck" are two different topics -- once again Strawbridge's sleight of hand. This is the identical switcheroo Strawbridge tried to play when, in discussing Port of Seattle, he "claimed" the numbers were all wrong, then began using intermodal figures for the entire Pacific Northwest, "claiming" they were Port of Seattle.
It is true there was a great deal of domestic wheat that moved interstate by truck, to Spokane, to Boise, to Canada, and also intrastate, to refiners, flour mills, cattle feed, supplements, breweries, bakeries.
Most of that went by truck.
That was, "once upon a time."
Those businesses are for the most part gone.
Except for a small dribble, so are the trucks.
However, trucks did not carry export wheat to PNW ports then, and they do not now.
The railroads have always carried that traffic.
The fact is that 97% of Montana westbound wheat now goes to Pacific NW ports, and that it goes by rail is explained by the market and significant changes in the market, not by changes in the relative truck/railroad cost factor, because, in fact, nothing has changed in the proportion of Montana wheat traffic that the railroads have carried to the ports.
The mode of transportation for that market is the same in 2006 as it was in 1990, 1980, 1970, 1960, or 1950 for that matter.
greyhounds wrote: Now if we were to accept the teachings of Mr. Sol, we would accept the belief that the railroad holds its shippers captive and is able to charge them exhorbitant rates which causes great economic harm to these poor decent American Farmers. But that doesn't make sense. The railroad would not gain business by increasing its charges to the wheat producers... The "poor farmers" still had that truck alternative and they wouldn't have shifted from truck to rail in the tremendous way they did if overall rail use cost had gone up. The BN (BNSF) reduced the costs of moving wheat out of Montana (they did the same for a lot of commodities throughout their service area.) .
But that doesn't make sense. The railroad would not gain business by increasing its charges to the wheat producers...
The "poor farmers" still had that truck alternative and they wouldn't have shifted from truck to rail in the tremendous way they did if overall rail use cost had gone up. The BN (BNSF) reduced the costs of moving wheat out of Montana (they did the same for a lot of commodities throughout their service area.)
.
General Accountability Office, 'Freight Railroads: Preliminary Observations on Rates, Competition, and Capacity Issues' released June 21, 2006:
But Strawbridge says this "doesn't make sense." But, that is the Strawbridge/Wilcox logic: it doesn't make sense to them, because it does not fit their preconceived conclusions about Montana wheat which, for some reason, each takes an intense interest in these days...
When the ICC was asked to look at it in that time frame, the 1980s, the ICC agreed with the Montana wheat farmers and resolved the case in their favor after they complained that the BN used its position to extract rates that were significantly higher than justified by costs, substantially higher than industry averages, and significantly higher than charges to wheat shippers elsewhere for similar service over similar distances.p. 20. McCarty Farms, et. al., vs. Burlington Northern, Inc., 3 ICC2d 822 (1987).
Strawbridge: And it certainly gained business. The railroad certainly would not have gained this business if it was charging too much in the face of a viable alternative, trucking. No, the railroad would only gain business if it reduced the costs of using its services to move the grain.
And it certainly gained business. The railroad certainly would not have gained this business if it was charging too much in the face of a viable alternative, trucking. No, the railroad would only gain business if it reduced the costs of using its services to move the grain.
The market that railroads had always exclusively served grew. The market that the railroads had not substantially served nearly disappeared. The market that trucks did not serve grew. The market that trucks had traditionally served nearly disappeared. Look at Strawbridge's own figures of the decline in the trucking percentage -- then look at the government report that shows that all rail grain rates increased between 1987 and now, and the percentage of Montana wheat carried at over 300% R/VC increased between 1985 and now from 14% to 39%.
Strawbridge: The railroad would not gain business by increasing its charges to the wheat producers...
The railroad would not gain business by increasing its charges to the wheat producers...
In a competitive market, true. But prices did, in fact, increase.
Notwithstanding railroad grain transportation price increases over nearly a 20 year period, as documented by the GAO, the percentage carried by trucks declined from 30% to almost nothing today.
That is because the trucks served a different market, and that market evaporated. Naturally, the railroad could only acquire/retain virtually all of the market in the face of price increases, only if in fact the market was captive. That's the key indicator of a captive market! And that happens to be exactly what happened.There is simply no plausible support in the statistical record for Strawbridge's claims, although the Goebbels analogy certainly seems to play a role in how he stakes his position based on outright misrepresentations.
Strawbridge: In other words, the Burlington Northern brought the unit grain train to Montana in the 1980's.
In other words, the Burlington Northern brought the unit grain train to Montana in the 1980's.
The first recorded unit grain train in Montana was operated by Milwaukee Road in 1973.
Strawbridge: Of course, Mr. Sol and FM Dave will falsely contend that the unit trains actually drove overall rail system costs up ...
Of course, Mr. Sol and FM Dave will falsely contend that the unit trains actually drove overall rail system costs up ...
Well, actually, a study done at Illinois Central Gulf pretty conclusively showed that 100 ton cars in unit train configurations did just that. What that has to do with this discussion, I do not know, but an AAR study in 1981 came to similar conclusions.
Ahlf, Robert E., "The Behavior of Railroad Track and the Economical Practices of Its Maintenance and Upgrading," in Roadbed and Rails: Fundamentals, Maintenance, and Economics, Institute of Railroad Engineering, 1988.
Ahlf, Robert E., "The Behavior of Railroad Track, and the Economical Practices of its Maintenance and Rehabilitation," presented at the Railroad Track Maintenance seminar, Madison, WI, March 2001.
"Economically Optimum Axle Load for Freight Cars," Robert Ahlf, Bulletin -- American Railway Engineering Association, January, 1984.
Ahlf, Robert E., "The Implications of the 100-Ton Car," Modern Railroads, February, 1980. Reprinted in Railway Gazette International.
"Economic and Physical Consequences of Operating Respective Car Weights over Track Structures," 40 pp., MSol manuscript copy, December 4, 1980, Robert Ahlf, Illinois Central Gulf Railroad.
"It would have been perceived by the industry as an embarrassment to re-emphasize the 80-ton car...the industry was so economically destitute at the time, that there was no interest in optimizing for long term economics. These axle-load-related track maintenance costs are related to, and defined by, long term economics." Personal Communication, Ahlf to Sol, 9/12/2006.
The AAR studies are referred to in NORTH DAKOTA STRATEGIC FREIGHT ANALYSIS, Item IV. Heavier Loading Rail Cars, Prepared by John D. Bitzan, Denver D. Tolliver, Upper Great Plains Transportation Institute, North Dakota State University, Fargo, North Dakota, October 2001.
I discussed these studies with a retired senior engineer NP, BN, who lived through the transition, and he confirmed that "the marketing guys came up with this idea, nobody did any studies on the 100 ton car, and the railroad company paid for it. The next bright idea was to put them in unit trains. It was a disaster."
Strawbridge: So about one of every three grains of wheat moved by truck in a market Sol claims is "captive" to rail. It obviously isn't.
So about one of every three grains of wheat moved by truck in a market Sol claims is "captive" to rail. It obviously isn't.
This is egregious. "one of every three grains of wheat moved by truck in a market ... Sol claims is captive. It obviously isn't." Note the use of present tense.
One of every three grains moved in the 1970s-1980s not only by truck, but in a domestic market. That market is gone.
However, confusing that with the market that Sol claims "is" captive [present tense] leaves out the fact that the current market moves about 2% by truck, because the market has shifted from a mixed domestic/export market to an almost entirely export market westbound. Another Strawbridge sleight of hand -- intentionally confusing one thing with another, and slipping in 20 year old data to justify that the market "isn't" captive and hoping no one notices.
That export market has never, ever been served by truck unless there was a significant grain car shortage and even then the trucks never went all the way to the ports, ever.
MichaelSol wrote: However, trucks did not carry export wheat to PNW ports then, and they do not now. The railroads have always carried that traffic.
To be fair, there was a brief period of time right after the opening of slack water to Lewiston Idaho where the truck/barge combo could effectively compete with the late 70's and early 80's rail haul of export grain out of Monana to the Lower Columbia deep water ports. As we know, this was when the Milwaukee began it's rapid meltdown to the PCE retrenchment, and BN was having internal operating problems of it's own. Since then, BN/BNSF has gotten it's act together in terms of moving to the 286k car, shuttle then unit trains, etc., aka the "productivity gains", while at the same time the barge capacity has remained virtually unchanged and the feds have imposed a moratorium on similar productivity increases in trucks.
So no, there were no trucks hauling grain from Montana to the Pacific Coast ports. It simply wasn't feasible, then or now. Because as I've stated a million times now, trucks cannot compete with railroads for the bulk commodity transportation market. The truck/barge combo could somewhat offset the inherent advantages of the railroads for a time, but the average truck haul out of Montana to Lewiston is just too long for the barge economics to make up for.
Today, you can truck grain from North Central Idaho to Lewiston and beat the unit train dynamics (BN tried to run a unit train from Lewiston to the Portland area, but it didn't even come close to beating the barge economics), but not from Montana or beyond. At best, we can get a backhaul of grain in a dry van from Montana or North Dakota now and then, but the OTR trucker grain haul is virtually dead, and it was a short life span to begin with.
Is it theoretically possible for the truck/barge combo via Lewiston to become efficient enough to compete with BNSF? In theory yes, GVW standards could be lifted to allow 160k truckloads, the barge lines could go "Mississippi-style" with larger than lock barge tows (wherein it takes two trips per barge tow through each lock, break 'em apart then put 'em back together again, very time consuming). In practicallity, no, it's just not likely for that scenario to avail itself.
And as it stands now, the truck/barge combo from Montana to Portland via Lewiston is no competition for BNSF. Ergo, BNSF has no competition for hauling grain from Montana to the Pacific Coast.
There's also the matter of Identity Protected Grain shipments, as well as the too small for unit train output of some specialized rotation crops. The IPG shipments must move in ISO containers from point of origin to final destination overseas, in either 20' or 40' containers. For any IPG shipments from Montana to Asia, the only viable choice right now is to truck either to Spokane or Lewiston. For the Spokane move, BNSF's quotes rates of about $640 per 20' and $670 per 40' to Puget Sound. For the Lewiston move, the barge companies charge a per container rate of about $120 per 20' and $160 per 40' to Portland, e.g. about a fourth of what BNSF charges for relatively the same distance!
Since it's roughly the same distance from central Montana to either Spokane or Lewiston, the truck rates will be the same to either destination. Assuming the same cost of drayage, it's clear that IPG shippers will use the truck/barge combo rather than the truck/rail combo, since they'll save $500 a pop. The only factor that could make them choose the truck/rail via Spokane is the relative lack of ocean carriers that call on Portland, but the likelyhood is that those Portland carriers will serve the same Asian markets as the Puget Sound carriers.
Of course, BNSF could reopen it's Shelby intermodal terminal, or open a new one in Great Falls, both of which are closer to the grain growers than either Spokane or Lewiston. Then it'd be a snap that most such shipments would move by rail, even with monopolistic rates. FYI - BNSF currently is not posting any intermodal rates out of Billings; Is a Billings terminal shutdown next on the screw Montana agenda?
It's somewhat ironic that the railroads have been moving more and more to bulk shipping over-efficiency-itus, while at the same time grain growers are likely to move toward the more lucrative specialized crop markets. BNSF is cutting back on carload and intermodal services in Big Sky country in deference to consolidated unit train terminals, while the growers are starting to demand more individualized transportation options to conform to their new crop specialization.
Gee, if BNSF had actually treated it's bulk grain customers in such a way as to allow them to be more competitive on the world markets, maybe those growers wouldn't have so much incentive to move to the high risk/high reward specialized crop markets.
It is interesting to note that railroads paying their full cost of capital could not beat barge movements. What is the recovery rate from the barge industry in the form of "user fees" for the Army Core of Engineers designed lock & dam inland water system?
If I recall correctly it is around 10 to 30%. Why are we worried about a private companies, the railroads, charging 300% of variable costs when the government is charging 30% to their competitor for the use of the inland waterway system?
MichaelSol wrote: True, and in this case, confusing export wheat, which went to the Columbia River if by truck, with "wheat hauled by truck" are two different topics -- once again Strawbridge's sleight of hand. This is the identical switcheroo Strawbridge tried to play when, in discussing Port of Seattle, he "claimed" the numbers were all wrong, then began using intermodal figures for the entire Pacific Northwest, "claiming" they were Port of Seattle. It is true there was a great deal of domestic wheat that moved interstate by truck, to Spokane, to Boise, to Canada, and also intrastate, to refiners, flour mills, cattle feed, supplements, breweries, bakeries. Most of that went by truck. That was, "once upon a time." Those businesses are for the most part gone. Except for a small dribble, so are the trucks. However, trucks did not carry export wheat to PNW ports then, and they do not now. The railroads have always carried that traffic.
Well, that's Michael Sol's story this time. He has to try to explain away the diversion to rail of export wheat from a truck/barge combination movement on the Snake River.
The only logical reason for the wheat to shift from the truck/barge movement to BNSF movement would be the fact that BNSF lowered its overall costs to the Montana producers and this caused them to shift their production to rail movement away from truck/barge.
But that disproves two pet core beliefs of Michael Sol. 1) The railroad is a 'monopoly' (it can't be a monopoly if a viable competing truck/barge system using the Snake River exists) and, 2) The railroad is using this 'monopoly' to charge high rates to the Montana farmers (the farmers would shift back to truck/barge if the rail rates were too high.)
So now Mr. Sol is simply saying the trucks never handled the export wheat. It went to domestic processors that have largely gone out of business. That's what he's saying this time.
But on June 13, 2006 ----
MichaelSol wrote: In 1980, a good percentage of wheat did leave Montana by truck, to the Lewiston barge terminal. There was a pretty good rate there. A relatively short truck movement over a two lane road through a wilderness. After the trucks tore up the highway, Idaho put a weight limit that killed the traffic.
In 1980, a good percentage of wheat did leave Montana by truck, to the Lewiston barge terminal. There was a pretty good rate there. A relatively short truck movement over a two lane road through a wilderness. After the trucks tore up the highway, Idaho put a weight limit that killed the traffic.
He was blaming an Idaho highway weight limit for "killing" traffic that he now claims never existed.
Real hard to keep 'em straight when you keep making 'em up, isn't it Mr. Sol.
The truth of the matter is that the BN simply took the business by offering a lower system through put cost than its competition. There is no other logical explination. The export grain that moved on the Snake River changed to moving on the BN because the BN beat its competiton on cost. The movement wouldn't have shifted to a higher cost system.
But this means the BNSF has competition (the Snake River barges and the highways are still there) and that it's had to, and has to, compete on price. This blows Sol's 'monopoly' belief out of the water - so he simply says it never happened.
In other words, he rewrites history to serve his purpose, again.
VPayne wrote: It is interesting to note that railroads paying their full cost of capital could not beat barge movements. What is the recovery rate from the barge industry in the form of "user fees" for the Army Core of Engineers designed lock & dam inland water system? If I recall correctly it is around 10 to 30%. Why are we worried about a private companies, the railroads, charging 300% of variable costs when the government is charging 30% to their competitor for the use of the inland waterway system?
You have to remember, there were riverboats on the Columbia Snake river systems prior to the dams being built. The Corps of Engineers were required by law to design the dams with locks and navigation aids to maintain this prior usage claim. There was an efficiency gain for river shipping companies when the slack water was introduced, and the barge company fees are set as a determination of this improvement over the free flowing prior river system.
Don't let the econuts and the rail oligarchy fool you. The barge lines do pay their own way, and they do it within the scope of a completely open access system. Contrast that with the railroads, who received huge land grants, anti-trust exemption, and now they are getting a portion of the highway users' money's to fatten their wallets. And all that occurs in a closed access system, aka monopolistic. If anything, it's the railroads that are taking advantage of the US taxpayers.
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