Boring Economic Questions: Railroad vs. trucks

Got to thinking the other day about costs of purchasing new cars, and trucks. So here are the questions that came up in my head:

  1. How much does the average freight railcar cost to build new?

  2. How much does the average eighteen wheeler (tractor AND trailer) cost?

  3. How long does it take to pay off the note on a freight railcar (assuming one could buy a car individually)?

  4. How long does it take to pay the note off on a tractor-trailer set (an 18 wheeler)… again, going purely on an average cost?

  5. Is there an auto insurance type program for rail cars?

Thanks!

I won’t get into questions 1-4 except to say the cost for an entrpreneur to start a trucking company is a lot less than for a business to start or maintain a railroad since the individual only needs to buy one truck to go into business. As far as #5 most major companies are self insured for damage up to one million dollars so if you lost one car you would eat the cost. Wreck a whole train going down a mountain pass and you would probably be talking to your insurance company who would then try to tell you they have depreciated and aren;t worth as much as you paid.

A new 2008 model Fleet spec like what JB or Swift runs is right around 110K the ones Werner and CFI and Marten run around 120-130K they have bigger motors and better interiors in them. Trailers depends on type flats figure on 15-40 depending on steel or combi or aluminum contruction and size 48-53 foot 96 inches or 102 wide and other options. Vans are around 20-30K depending again on the options. Reefers are in the area of 50-70K depending on unit size and other options like insulation and floor thickness. Figure on a 5 year payoff at around 7-10% payments are around 3k-3500 per month for a tractor and trailer combo. Insurance is around 8K a year for all types for a truck per unit again the larger of the fleets they are self insured.