VOLKER LANDWEHRI think you can only compare the "above the rail" costs. Amtraks owns a large part of the NEC and is responsible for investment into and maintenance of that part of the line. The LD trains don't even pay the costs they cause to their hosts. Looking at the "above the rail" costs LD trains make a loss, NEC trains a profit. ... How can free cash flow get lost when LD-trains make a loss? How can Amtrak's debt rise when the $500 million loss of the LD trains disappears? The maintenance and investment costs are the price Amtrak has to pay for owning the ROW. On the other hand it allows Amtrak and others to run around 40 trains per direction daily in some sections instead of one pair on host railroads.
I think that when Mr. Selden discusses free cash flow and ROI, he's specifically referring to the above-the-line situation.
One perhaps sensible thing to consider is, with the advent of mandatory PTC, returning substantial amounts of freight traffic to the ex-PRR (and perhaps the New Haven as well). That would at least allow a substantial part of the MOW to be spread across known actually-profitable traffic. Yes, it's a pity we threw out the freight electrification, and the Atglen and Susquehanna, etc., and did a host of wrongsizing changes both south and east of NYC. But the thought is there, and the cobbled-up alternatives used for freight in that region of the Northeast could benefit from the capacity. I would also note that car types and the general state of car and wheel maintenance are now much better for use on high-speed track than at the time of the original cutoff.
Overmod I would also note that car types and the general state of car and wheel maintenance are now much better
You should hear the flat spots galore on various UP freights in west suburban Chicago.
charlie hebdoYou should hear the flat spots galore on various UP freights in west suburban Chicago.
Yes, but I do still remember the noise that freights made in the late '60s and '70s even on nominally high-speed ROWs, and by contrast how quiet even loaded coal trains are now (even on lines where significant railhead plastic flow occurs within a year, as is the case on the ex-Southern line through Germantown and Collierville).
I wonder if it would be practical to continue the existing (ex-Reading) freight route 'in parallel' with the Corridor, diverting flatwheel cars (or unit/block moves with flat wheels) off the high-speed track? And providing 'rapid response' access to wheel machining or reprofiling at common interchange locations?
Overmod charlie hebdo You should hear the flat spots galore on various UP freights in west suburban Chicago. Yes, but I do still remember the noise that freights made in the late '60s and '70s even on nominally high-speed ROWs, and by contrast how quiet even loaded coal trains are now (even on lines where significant railhead plastic flow occurs within a year, as is the case on the ex-Southern line through Germantown and Collierville). I wonder if it would be practical to continue the existing (ex-Reading) freight route 'in parallel' with the Corridor, diverting flatwheel cars (or unit/block moves with flat wheels) off the high-speed track? And providing 'rapid response' access to wheel machining or reprofiling at common interchange locations?
charlie hebdo You should hear the flat spots galore on various UP freights in west suburban Chicago.
That is the purpose for carriers installing WILD Detectors (Wheel Impact Load Detector). In the CSX implementation, there are 4 grades of defect. The first two levels do not require actions from the crew - they develop a history starting point for the car(s) detected. The Level 3 activation requires the car be continued to destingation at not exceeding 30 MPH - Car Dept. at destination is to inspect the car and change out the offending wheel set(s) as necessary. The Level 4 activation requires the train to STOP upon notification and for the Conductor to inspect the wheel(s) indicated, and if deemed safe to move, move the car(s) to the nearest set out location and set the cars out for further Car Department actions.
Never too old to have a happy childhood!
Thanks, Balt. I have a suspicion that the noise 'Charlie' is hearing is no more than Level 2, and perhaps that many of them are lower, especially those proceeding east out of Global where attention could have been paid to them. The question is whether any level of clearly audible flat wheel 'ought' to be permitted on nominal high-speed rail; I would argue that even Class 1 involves more track damage 'than it's worth' even if a system for assessing higher surcharge for 'whoever it was that flatted the wheels' could be implemented and administered fairly.
As with much highway deterioration, 'safe to move' doesn't mean safe against damaging the 'road' ...
VOLKER LANDWEHR MidlandMike Rather than ignore facts, Mr. Selden brings up the facts that many such as yourself seem to want to ignore, that is that the NEC is very expensive piece of infrastructure to maintain. The total economics overwhelm any profit from "above the rails" operation. So you "don't care much about the necessary investments into the NEC." That does not negate the fact that those capital costs are part of the costs needed to keep it running. The NEC is no more of an economic success than any other of Amtrak's product lines. I think you can only compare the "above the rail" costs. Amtraks owns a large part of the NEC and is responsible for investment into and maintenance of that part of the line. The LD trains don't even pay the costs they cause to their hosts. Looking at the "above the rail" costs LD trains make a loss, NEC trains a profit. That Mr. Selden seems to ignore when he writes: Why any enterprise would try to eliminate its largest, most efficient and most successful division is a mystery. And: The supreme irony of Amtrak’s effort is that if it succeeds, all that traffic, free cash flow, return on invested capital and growth opportunity will be lost. Worse, its annual loss, and “need” for federal subsidy to sustain what remains, will grow by more than $400 million annually (according to Amtrak), pushing the total loss and subsidy up by that amount to a figure approaching $2 billion annually. I do not understand the following: How can free cash flow get lost when LD-trains make a loss? How can Amtrak's dept rise when the $500 million loss of the LD trains disappears? The maintenance and investment costs are the price Amtrak has to pay for owning the ROW. On the other hand it allows Amtrak and others to run around 40 trains per direction daily in some sections instead of one pair on host railroads. I don't know if subsidies for the NEC network are unfair when trucks and cars don't pay for the complete damage to roads they cause, or airline use an infrastructure provided at least in part by the government. I don't care in the sense that I accept the investment cost and that I think they are better used in the NEC than elsewhere in the system. Passenger-miles, load factor, and market share alone don't tell anything about the profitability. Regards, Volker
MidlandMike Rather than ignore facts, Mr. Selden brings up the facts that many such as yourself seem to want to ignore, that is that the NEC is very expensive piece of infrastructure to maintain. The total economics overwhelm any profit from "above the rails" operation. So you "don't care much about the necessary investments into the NEC." That does not negate the fact that those capital costs are part of the costs needed to keep it running. The NEC is no more of an economic success than any other of Amtrak's product lines.
I think you can only compare the "above the rail" costs. Amtraks owns a large part of the NEC and is responsible for investment into and maintenance of that part of the line. The LD trains don't even pay the costs they cause to their hosts.
Looking at the "above the rail" costs LD trains make a loss, NEC trains a profit. That Mr. Selden seems to ignore when he writes: Why any enterprise would try to eliminate its largest, most efficient and most successful division is a mystery. And:
The supreme irony of Amtrak’s effort is that if it succeeds, all that traffic, free cash flow, return on invested capital and growth opportunity will be lost. Worse, its annual loss, and “need” for federal subsidy to sustain what remains, will grow by more than $400 million annually (according to Amtrak), pushing the total loss and subsidy up by that amount to a figure approaching $2 billion annually.
I do not understand the following: How can free cash flow get lost when LD-trains make a loss? How can Amtrak's dept rise when the $500 million loss of the LD trains disappears?
The maintenance and investment costs are the price Amtrak has to pay for owning the ROW. On the other hand it allows Amtrak and others to run around 40 trains per direction daily in some sections instead of one pair on host railroads.
I don't know if subsidies for the NEC network are unfair when trucks and cars don't pay for the complete damage to roads they cause, or airline use an infrastructure provided at least in part by the government. I don't care in the sense that I accept the investment cost and that I think they are better used in the NEC than elsewhere in the system.
Passenger-miles, load factor, and market share alone don't tell anything about the profitability. Regards, Volker
It's obvious that Mr. Selden would not agree with your statement: "I think you can only compare the 'above the rail' costs." The government has to subsidize both Amtrak's operating costs and capital costs at 100 cents on the dollar.
You say: "I do not understand the following: How can free cash flow get lost when LD-trains make a loss? How can Amtrak's dept rise when the $500 million loss of the LD trains disappears?"
If LD trains are discontinued their fixed costs including equipment will continue as well as labor protection costs to the laid off employees. The main thing that will not continue is the ticket revenue. The $500 million loss will balloon (according to Amtrak).
The LD trains run on track that carry enough freight to pay their infrastructure cost. The NEC does not capture in ticket revenue anywhere near the cost to renew their infrastructure.
I have no problem with the government spending on NEC infrastructure as a public investment. Mr. Selden might, or might not, have overcompensated NEC total costs to counter other's arguements that only show operating costs to favor corridor trains, nevertheless it shows that the total costs for each of the three Amtrak business units (LD, Corridor, NEC) are somewhat comparable, and that you can't use an economic arguement to eliminate any one of them.
When it comes to accounting costs - everybody is right and everybody is wrong.
Everybody wants to account for costs THEIR way to prove THEIR points.
MidlandMike If LD trains are discontinued their fixed costs including equipment will continue as well as labor protection costs to the laid off employees.
Rio Grande Valley, CFI,CFII
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