Congestion from coal and oil trains seems to be the key factor forcing closure of a prominent express rail service that carries Washington fruit and produce to East Coast markets.
Cold Train on Thursday announced it is shutting down its express service from Quincy, Wash. because restrictions in the BNSF Railway schedule changed delivery guarantees from three days to six days.
I second that sentiment. I grew up being taught that to succeed the railways had to expand the number of commodities they hauled. You don’t grow a business by cutting service and expenses. You try to grow the top line.
This is pretty sad. These people have lost their shirts. An ugly message to other business people who might be considering startups that depend on rail.
Sounds like it might be a case of a bean counter at BNSF deciding they didn’t want the company’s business and figuring out an easy way to get rid of it and deflect blame.
Depressing news, but if there us a silver lining in this dark cloud, it’s that the parties involved came to the realization that it was better to own up to the problem than to hold themselves o a “promise” that was no longer feasible, watch the situation continue to deteriorate and leave a bad impression with many more people.
The recent mandates lower speeds for oil moves, coupled with the approach of a saturation point on the bidirectionally signalled "2 main track’ pattern which has become the rule for all but a handful of main lines serves to underscore the point that the industry might have no choice but to expand back toward the three- and four-track main lines that once graced a handful of eastern trunk lines.
The only real question would be how to accomplish this – probably by “incremental” expansion. That is, either a revival of the “long sidings” for overtaking moves that originally figured into NYC’s slimming down of its Albany-Cleveland main in the late Fifties, or the creation of more “3 main track” lines in the mold of UP between Gibbon and North Platte, NE,
Given the rock-ribbed conservatism for which UP is noted, and the preference for one-direction main lines exhibited in regions such as west Texas and southeastern Nebraska, I don’t see much enthusiasm for innovative dispatching originating at Sixth and Dodge (Omaha). But its possible that some other carrier might be wiling to experiment, particularly if public-sector, or even academic co-operation (he upgrading of locks on the Ohio River waterway involved some use of simulation models way back in the Sixties, and CSX reportedly used the same concept for a demonstration of a 3- and 4-track ‘A’-line (Washington-Jacksonville) about a decade ago).
Sooner or later, the upper limits of current dispatching technology will have to be challenged.
I chuckled a bit at this when I first read the thread – then I looked at the story. I see BNSF quoted as saying
In other words, no preference for perishable high-value traffic over coal trains, or presumably restricted-speed oil trains? And, reading between the lines, no effective end-to-end timing guarantees even at the longer trip times…
That would seem to make little sense from a conventional standpoint of maximizing revenue from operations, presuming the value of a Cold Train consist is higher than the equivalent trainlength of mineral or oil cars. So there must be more to the various operations of the congested system than meets the eye – quite possibly enough to make special handling for the Cold Train consists impractical at any realistic tariff… in other words, problems leading BNSF people to decide they did not want (or could not provide cost-effectively, which translates into ‘did not want’) the Cold Train business on the terms the Cold Train people needed to stay in business.
This is yet another reminder of the inherent limitations of rail. Even a double-track, bidirectionally signaled main is, in highway terms, no better than the old two-lane roads of 60 years ago, before the Ohio & Indiana turnpikes and then the Interstate system.
Makes you think the concrete fraternity may be onto something.
It’s sad that railroads can no longer do speed as such. We know that Amtrak is an enemy; but so, it seems, are priority intermodals and now, of course, produce and (you can bet) the prospective Shoener meat trains.
If rail has a future beyond clunky commodity trains, it’s got to do better than this every time business providentially picks up.
Responding to Overmod’s post above: To some extent, then, the Cold Train traffic seems to have some of the same tough fast-schedule characteristics as priority UPS trains, which has led certain railroads to eschew* that demanding traffic in favor of less-sensitive traffic.
But I wonder if the Cold Train people could have protected themselves with a contractual arrangement with BNSF that guarantees either the service levels that the Cold Train operation needs, or else compensation for the ongoing equipment and overhead costs that were entered into and incurred in justifiable reliance on BNSF’s scheduling commitments.
(*Never thought I’d deliberately use “eschew” in a sentence outside of an English class, but there you go !)
Good points - I agree there’s something more going on here. The Cold Train schedule would seem to be not too different from any other intermodal, and that other traffic hasn’t been jettisoned. Perhaps to BNSF execs it had only a limited upside growth potential, so better to lose it than the oil trains - but coal is generally considered to be a declining commodity and traffic, so why turn away any future premium money-maker just to hold onto a low-rate bulk traffic ?
One optimum multiple track configuration (short of streetcar-like train volumes and 4 or more tracks, which is extremely rare) is 3: 1 each way, with the 3rd available (any one of the 3) for overtakes/ passes of faster trains around slower ones or cripples, set-outs, etc. in either direction, and for MOW to do its activity without interfering with the smooth flow of traffic in each direction. You can almost count on your hands the number of lengthy triple-track freight routes in the US - UP in Nebraska and suburban Chicago (see almost any of Carl Shaver’s posts), NS from Altoona to Johnstown (mountain grade, too), maybe CSX at Sand Patch and 17-Mile grades, BNSF at Cajon Pass, etc. Unfortunately, not easy or cheap to achieve, but that will be the next wave of capacity expansions after the major routes are mostly double-tracked.
The more articles I read about this - it is sounding like Cold Train was undercapitalized and barely making ends meet when they were getting the 90% performance. There is a whole novel of things that are not being published about this happening.
What effect will this have on the somewhat similar McKay TransCold operation that BNSF had planned on starting in May 2014 ? Link to March 4, 2014 NewsWire article:
Yet they didn’t go toes-up until the service fell down completely. I maintain that the rails need to find a way to satisfy the needs of higher-speed business or resign themselves to hauling lower-value bulk commodities. That’s a living – but so much less than the rails were able to do 50 years ago, even under the thumb of the ICC and with the passenger burden.
But remember, most new businesses fail. And those that don’t rely on a good cash flow to keep their heads above water. Cold Train lost any good cash flow situation it had when BNSF’s service went to Hell.
The amount of cash Cold Train had coming in was determined by how many loads it could handle. The number of loads it could handle was dependent on the turn around time of its containers. How many days did it take for a container to cycle from Quincy, WA to Chicago and back. The fewer days for the cycle, the more loads (and cash) Cold Train brought in.
For example, if they were doing 200 loads per week and the BNSF’s problems reduced that to 100 loads per week because of longer transit times their revenue would be cut in half. But their expenses would not be reduced by half. They’d have to pay the note on their containers anyway. It would be a fixed cost that they could not reduce.
This destroyed their cash flow. A start up cannot stand a negative cash flow for any length of time. They could not pay their bills and raised the white flag. (Additionally, they were loosing loads because customers will not put up with crap service.)
It’s too bad. They had a good business plan and a great shot at success. But they were reliant on one supplier, the BNSF, and when that supplier got into trouble Cold Train got in to a coffin. It’s a good rule to have more than one supplier, but I don’t know how Cold Train could have worked that out.
As always Greyhound, you add great points. Being stuck with one supplier placed them at the mercy of a company many times larger. Cold Train had no bargaining chip to play.
Others have options.
Lovely Mrs. MP173 and I had dinner last night with friends including a VP/Sales for a large (very large) TL carrier which uses intermodal. As always the discussion turned to trucking, drivers, and ultimately railroad service. BNSF’s service is melted and they have shifted their business to UP (“at least UP is trying, BNSF has pretty much given up on the refer business”). Perhaps UP is more sympathetic to the produce business since they are running the “apple trains” to CSX on a 4x week basis and understand a service issue in intermodal trickles down (or trickles up).
Truck driver shortage are major problems, particularly since the economy has picked up. Drayage drivers is becoming more and more of an issue. Expect to see these containers beginning to stack up at the terminals.
[snipped] “…It’s too bad. They had a good business plan and a great shot at success. But they were reliant on one supplier, the BNSF, and when that supplier got into trouble Cold Train got in to a coffin. It’s a good rule to have more than one supplier, but I don’t know how Cold Train could have worked that out…”[snip]
BaltACD SAID: "…__The more articles I read about this - it is sounding like Cold Train was undercapitalized and barely making ends meet when they were getting the 90% performance. There is a whole novel of things that are not being published about this happening…"
I would wonder if there could have been any thought of a possible rerouting to a different line towards the East? Realizing that any extra miles would cause additional expenses to Cold Train, but it sure seems counter-productive to not try a longer route to save their operation? Could not CN or CP provide a route out of Northwestern Washington State?
To BaltACD’s point… It seems to be a given, in most start-up operations, that undercapitalization is a real problem,. I would be curious to know if they had negotiated a Contract with the BNSF for a level of guaranted services for their Trains[Cold Train’s]] over a given routing with BNSF. If that is an affirmative answer: Then the question would seem to be come one of "Who Dropped the Ball’? As was said… There HAS to be a lot more to this story than is being made public right now…
Here is a link to what may be “the rest of the story” [Note: It may require a free registration to view it?]