I think that was what I was trying to get to with my miserable grasp of english. All kinds of brownfields will sit empty with no industrial redevelopment–I even talked to a friend of mine who is doing the redevelopment thing and he told me there are many brownfield properties around that will NEVER be developed again----even if it is for essentially the same use. Hence, we get to put up with sprawl— unless there is some kind of evidence that the current way one defines a brownfield be looked at closer.
I see what you’re saying. I’m just wondering if you’re giving the green component too much credit for what’s going on. It seems obvious to me, as it probably does to most Americans, that the cost of oil will be higher in the future because it’s supply, and therefore the price it can demand, are controlled by foreign oil producers. The green movement, and any legislation that it
I sort of wonder the same thing. It also depends on the strength and/or weakness of the dollar as well. Anything can I think have an influence, especially foreign oil control. Thinking of which–the Chinese could very well become major players as the Russians are with the EU market. Yuck—what a mess
greyhounds - the part of economic theory that you summarize above, I agree with, no question. With the benefit of RWM’s and some other comments, the pricing and market shares all seems to be working out as it should. It’s the part that I quoted from the article a long ways above that puzzles me - or is flat-out wrong, as follows:
“One reason for the growing popularity of intermodal is the depressed state of the trucking industry, plagued by excess capacity and aggressive pricing, Longbow Research analyst Lee Klaskow told Reuters.” Huh ? Wouldn’t those factors tend to keep traffic on trucks and not intermodal ? 
Now “excess capacity” is the same as an incre
[quote user=“Paul_D_North_Jr”]
greyhounds - the part of economic theory that you summarize above, I agree with, no question. With the benefit of RWM’s and some other comments, the pricing and market shares all seems to be working out as it should. It’s the part that I quoted from the article a long ways above that puzzles me - or is flat-out wrong, as follows:
“One reason for the growing popularity of intermodal is the depressed state of the trucking industry, plagued by excess capacity and aggressive pricing, Longbow Research analyst Lee Klaskow told Reuters.” Huh ? Wouldn’t those factors tend to keep traffic on trucks and not intermodal ?
Now “excess capacity” is the same as an increase in ‘supply’, which in classic economic theory - and all else remaining unchanged - leads to price cuts, which is “aggressive pricing”. So far, so good. We would also expect that with price cuts, demand would shift in response and the volume/ market share of the price-cutter would increase (i.e., same as Wal-Mart’s retail business model) - again, all else being equal. But this guy is telling us that the opposite is happening - that despite the trucking induustry’s aggressive pricing, intermodal’s market share is increasing. That does not comport with Mr. Smith’s notions - cut prices and lose market share ?!? And the nuances I referred to are such things as the ‘no-show’ truckers. I don’t remember that being a part of Econ 101 or 102 - that if you take advantage of a depressed market price (not a ‘loss-leader’ or other ‘quick buck’ situation), the result is going to be less supply ?!?
- Pa
Paul
In order to get the appearant inconsistancies with the principles of Econ 101, you have understand the make-up of the over the road trucking business. Not all business entities that offer trucking services meet what might be expected for a trucking company. One might assume that a “trucking company” would actually own trucks and employ drivers. That might be typical of larger companies, say those fielding fleets of 50 to 100 trucks and up. However there is a very substantial number of entities that offer the service who do not own trucks or directly employ drivers. Rather, they rely on being able to contract with others who own trucks and drive as owner operators or provide drivers. The arrangement may involve continuing contracts or be just on a trip by trip basis.
I haven’t been able to quickly find statistics to showing the market share of the non truck owning entities, but anecdotal information seems to indicate that it is significant.
So here is a scenerio. The head of a large trucking company, finding that his regular customers are shipping less due to their business downturns, decides to see if he can get some business from new accounts. For various reason, he may figure that the current book of business is locked up so he isn’t going to cut their rates and slash his margins, but he might let his sales force hit the street and go after small shippers with rate (price) offers well below his “standard” rate.
So the saleman calls on Joe at Little Manufacturing Company who has been dealing with a broker who has been getting his loads hauled at a nice rate, say $2.00 a mile, and offers to handle his loads at $1.80. Joe syas that’s good, I’ll get back to you. With a rate offer from Big Trucking, Joe calls his broker who says it’ll be tough, but I’ll match the rate. Joe says
[quote user=“Paul_D_North_Jr”]
As to the environmental ‘brownfields’ thing - it depends. A hot market and a desirable property for a non-residential use will go a long ways towards making such things just another business risk. Here in Pennsylvania for about 12 years now we’ve had the ‘Act 2’ process, which after you study the heck out of the property, is in brief similar to confession in the Catholic Church - tell all the problems to PaDEP, get absolution for what’s coming to the site from elsewhere, plus everything you’ve disclosed and cleaned-up to 1 of the 3 levels of certain standards, so that you can go forth and sin no more (apologies to anyone who may be offended by my sacreligious tone here - but the analogy is apt, I assure you). No, it doesn’t make the potential EPA/ SuperFund bogeyman go away - but they’ve got some memo of understanding with PaDEP, such that I’ not aware of any situation yet where they’ve come in and upset the apple cart.
Proof of this pudding also being in the eating, it’s worth noting that the former Bethlehem Steel Co. plant in Bethlehem, PA has been or is being or is planned to be redeveloped for a variety of non-residential uses. Last May 2009 the Las Vegas Sands people opened a casino 
on the site of a lot of the former shop buildings. More interestingly, the Beth-Intermodal/ Lehigh Valley Rail Management intermodal terminal operation recently occupied a good portion of the former coke works - a nasty site at best. An early project was a 6-turbine natural gas ‘peaking’ generating plant - Connectiv, I think, owns that one. Although, to be fair, a little south of that is about 60 acres or so that was designated “NO BUILD, NO PARK” - so to this day that’s where a lot of wildlife - deer and turkey, mainly - hangs out.&nb
Look, I can see why that would be so dang difficult to see anything like that. No city councellor or admin is going to allow properties like that to lose value in any situation. How then do we account for these strange things that occur then? The GSW plant area is right on a high traffic area. Location cubed. The land valuation was dropped to facilitate this development --why? The area itself was in a low valuation area to begin with–depressed real estate market—here–in my example. Not a high value area. Is every single ‘brownfield’ jacked up so high that no one will ever touch it in a million years? Is every single ‘brownfield’ so loaded up with PCB’s like some athletes jacked up on 'roids that they will never be reused–even if for a similar industry? I do believe that the valuation also takes into account similar properties–in the same neighbourhood. Which was done here. All the neighbouring plants were not going for anymore than this plant was.
I did suggest that they could be had for a ‘song’–otherwise these mere exceptions would definitely not have happened. I do think the problem is more on what defines these so-called ‘brownfields’. As well as what actually gets developed on them. Paul’s example
Well said, and I hope widely read and understood, RWM. [:)]
Guidelines, practices, principles…they only help to steer us in a direction, but they don’t get all the rocks and banana peels out of our way. Every case is unique, and requires a specific and local application of these general ‘rules’, but they are done in different places, for different markets, for different products, by different brains in different legal settings. So, they have to take different paths, and they don’t all look alike once they are accomplished.
-Crandell
RWM -
Please accept my apologies for my example apparently creating the impression of using a single example to disprove that what you posted was correct as a general case. Trumping or ‘topping’ your experiences - as you said, ‘‘try[ing] to make their posts look important or cast doubt on the original answer through their exception’’ - was not at all my intention or object. You’ll note that I never expressly said or claimed that.
As you say, we’ve been around this track a few times. So it was actually running through my head as I was typing that “This may be a ‘one-of’ exception to their experiences, but it’s interesting and may provide some insight to them as to how it was done in one instance” - or as you put it, “I agree with the rule, but let me share my example because it’s kind of fun”. But I neglected to expressly state that, so I can see your basis for being insulted.
I thought and intended to successfully avoid the offense that you describe by the following:
Proving once again, as my high school calculus teacher, the late Paul F. Brindisi - a man who had extennsive and cited the value of ‘experience in industry’ - used to say: "Fools rush in where angels fear to tread . . . ", here I go again*:
Thanks, Paul. I respect your knowledge and experience, and, your contributions to my knowledge base.
It’s easy to divert into example for the sake of the example. The question to me is whether the example unreasonably diverts attention from a more important topic. If the topic of whether rail market share of intermodal is increasing is uninteresting to us, and it’s more interesting to talk about brownfield sites, let’s go start a discussion about that. But if the point is to talk about intermodal market share, then a brownfield redevelopment discussion is at best a minor point in that larger discussion. We can note it as a constraint in about one sentence, and move on. However, if someone wants to use expertise to dispute my point that brownfield sites are not a constraint, I welcome that – if it’s really expertise – because then I learn something I didn’t know. Lack of expertise posing as expertise is disingenuous.
However, if we don’t care about the larger discussion, let me know – that’s all I ask. I’ll move on. I participate in this forum to learn more about rail issues and practices I’m interested in and to improve my performance at my rail job for the real debates I have to have with management, elected officials, shippers, and agencies. When it stops being that and starts being a collection of people claiming that one datum establishes a trend line, it stops being a useful place for me to visit. (I don’t do well with that kind of interjection from my staff in meetings, either. And I don’t think they like me very much, but they do get a lot of work done anyway.)
RWM
RWM -
Well, I’m kind of wondering how we came to be here, too, at a couple of different levels. You said that “The question to me is whether the example unreasonably diverts attention from a more important topic.” Fair enough - from the self-discipline editorial function to keep a thead on topic and from going random or anarchistic*, I can readily see what you mean- otherwise, it becomes just a collection of random messages.
[* . . . must . . . resist . . . writing . . . . “rogue” . . . [;)] ]
But I just looked back and found that my 1st post = 2nd one under this thread was this - and had no mention of ‘brownfields’:
“He noted that intermodal is also more attractive to shippers because it’s greener—as it takes about a third less fuel than shipping by truck alone.” Do the shippers really even care about either of those ? As long as the service meets their needs, and the price and time are competitive ?
Then I came back in the middle of
Seems appropriate about now …
Does anyone have a grave exhumation icon? For restarting this topic not rehashing the dead horse.
[quote user=“greyhounds”]
Exactly. At a lower price there will be less supply. That’s the supply curve. That’s what’s happening in trucking. The price went down and trucks are being pulled from the market.
The truckers leaving the market are being forced out because they can’t cover their cost. The “Zombie” thing still leaves too many trucks chasing too little freight, but eventually the
I can see the outline of something here that we’ve run into before. That being, a subject within a thread that, for better or worse, overtakes (sometimes hijacks) a thread. Sometimes, it steers a thread to new and exciting destinations. Sometimes, no doubt, it can kill a thread dead as a doornail. A lot of times, I find myself wishing to transplant a subject to a new thread. The few times I’ve tried, the results were so-so. Such is the nature of internet forums.
That being said, I probably should step up and take the blame for being the first on this thread to lead it astray. Suffice to say, that the green issue is something pretty hot in my industry right now. (Building materials.) Let’s just say, the discussion hit one of my hot buttons.
Now, back to our regularly scheduled program.
How will an increase in domestic intermodal traffic nationwide affect those of us in the railroad outback areas like S.D.? I envision more origination/destination pairs between big places to help out with congestion and perhaps lower consumer prices. What about those off the beaten path?
I think that it may be true that the ‘green’ thing may have been in there but now that I read my posts through I believe that I’ll take the blame for knocking it right into the ‘brownfield’ stuff. Too bad I can’t delete these things—empty the posts?
I’m glad you ask that question. It’s a good one.
You live in a good freight market. The Sioux Falls and Sioux City areas produce a lot. They also consume. I’ll just bet you folks out there buy tires for your cars, replace your kitichen appliances, acquire new carpeting, and everything. I’ll wager you even have bananas and coffee in your grocery stores. You probably even have UPS service. I’m pretty sure of that last fact because we hauled Sioux Falls UPS loads on the ICG. (After we left South Dakota they went to Sioux City and were trucked into Sioux Falls.)
None of this stuff is produced locally and it all must be trucked in because no railroad has an intermodal terminal in the area. It’s a good question as to why they don’t. The production and consumption mean that there are revenue loads both in and out for the IM equipment. Empty, non-revenue miles, they are a bad thing.
The rail lines to the area aren’t capacity constrained. CN’s light density Iowa line is the prime example. I don’t know. I can’t figure it out. Why the railroads just walk away from significant additional revenue that can be had for very little additional cost is beyond me. Why they just conceed these markets to the truckers is a question I can’t answer.
There are exceptions. The FEC is only 360 miles long. But they’ve shown a willingness to put a new IM terminal in place between the ends of that 360 miles if it will make 'em a buck. (They’ve opened two new IM terminals in th
I don’t follow these posts on a daily basis; it’s more like weekly, so I’ve just now spent the last half hour following a very interesting thread. Thanks all, especially RWM, for teaching me a LOT about the brownfield issue. I mean this - okay so the topic got hijacked, but this was all new to me and I did appreciate reading it.
First, for those of you who may not recognize me (I don’t post here very often), my credentials are 15 years in the industry, mostly spent marketing intermodal. For the most part, I would hand out A’s and B’s to the comments already made, but there are a couple of points I’d like to add.
a) I’m not sure why brownfields along right-of-ways were even mentioned here. The whole point of intermodal is to connect shippers and receivers who aren’t rail served. (Although I have often wondered if the trusty old boxcar couldn’t be used more effectively than containers for at least some intermodal freight. Since we’re already destuffing containers on the west coast… topic for another thread.)
b) For “green” (an unfortunate term as it conjures up visions of tree-hugging vegetarians) substitute “realization that from here on out, oil demand growth is going to outpace supply, while some form of international pricing scheme to charge for the privelege of spewing carbon into the air is inevitable”. Simply put, it’s becoming obvious that we’re in they dying days of the “cheap fossil fuel” economy of the 20th century, and the 21st century economy is going to be structured quite differently. Any good company wants to be out in front of that.
- I love the comment on BNSF’s marketing department not working too hard. Tell me about it. Starting in the early '90’s, we had to beat business off with a stick. I’m serious. Even at the railroads that are “best” at it, intermodal is the