The news of CP+KCS is dominating headlines at the moment as it should. This willl create a true North American railway. So where do we go from here? BNSF, CN, CSX, NS, and UP? I’m sure press releases relating to this combination will appear in the news shortly. Though who out of the Big 4 US systems is in shape to make a move East of the Mississippi? BNSF and CSX seem to be doing better than their perspective rivals in their territory. UP and NS are still trying to get their systems through the PSR wringer.
A BNSF+CSX combination might not be a bad idea and may be better than BNSF+NS in reality. BNSF already has rights to North Baltimore, OH ICTF. Both are partners in Schneider National IM Service. CSX has direct access to BNSF’s Corwith IM Ramp in Chicago. They provide IM service to the Southeast US-California via Memphis, TN.
UP+NS. I believe these two interchange quite more carload and IM traffic between each other than their rivals BNSF and CSX. Correct me if I’m wrong. NS and UP offer IM service between the Southeast and California via the more direct Meridian Speedway LLC. UP was recently granted trackage rights on the old Wabash between KC, and Springfield, IL.
CN you look to be the odd man out going forward… For now…
This is just a synopsis of current events. So what are your guys thoughts?
IF and that is a big IFthe STB approves the CP-KCS merger. I don’t know that the political climate will permit the STB to approve a merger between the existing East and West Class I’s - however, if one is approved the other is mandated.
Would two railroads serve the public better than four? Will service for customers improve and become less expensive? If not, how would the public interest, not just the corporate interest, be served?
If a merger is not in the public interest, why would the Federal gov’t enable it?
One thing that would be rdeuced for shippers would be the interchange cost between railroads. A seemless weast west route would be good IF and ONLY if the STB keeps a tight rein on the railroads increasing prices. I can see a small increase to keep up with costs, but the combined railroads will have overall reduced administrative costs which they should be made to pass on to the shippers. Personally I would like to see a BNSF/CSX merger. I think that the BNSF management really works well and since they are free from the Wall street wolves, the only thing that they have to worry about is running a railroad.
If psr has taught us one thing about railroads; it is that “sharing” cost savings with their customers is anathema. Cost savings go to the shareholders - not the customers.
i would imagine with less railroads to compete for the lower price with prices would maybe go up, but that’s kind of a stretch seeing how there still competing with a few other companies
Well a merger like that seems unlikely due to the size of both and they’re both doing well a big merger now seems other then the cp one there aren’t many small rail roads to gobble up and these big guys aren’t in bad position as to being desperate
About 10 years or so back, when Jim Young was in charge, our terminal’s lead safety person gave a presentation to a group that included him. Afterwards, he talked with Young. One of the things discussed was possible future mergers.
Mr. Young said he couldn’t say much, other than conditions at the time weren’t right. If or when the conditions become right, UP would go after CSX. That’s something I’ve heard since 1990 or so.
Whether that view still holds, I couldn’t say. Although I still think it to be true. However, I’m not sure the time may ever come when conditions are right. At least not for the next few years.
UP - CSX was what I was hearing on CSX - if and when. There were a number of former UP officials working for CSX at the time.
Having been retired for 4 years and ‘out of the loop’, especially since my craft was moved back to Jacksonville - I have no idea how the winds are currently blowing.
That’s the rationale I heard, too. That after the UP took over the MP, a buyout was offered. It was expected that former MP people would take it. More UP people took it and many wound up on CSX.
I would imagine that many of those would be retired now (on both roads) so I couldn’t say if the winds still blow the same, either.
Jeff, and Balt. Last year Railway Age published a interview with Cindy Sanborn on her return back East to help NS with PSR integration. Here’s a quote from her about the parity with UP, and CSX.
“First, the people were the same at UP as they were at CSX. If I closed my eyes and just focused on the issues under discussion, I could have been at either railroad.”
BaltACD is right - any proposed US East-West transcontinental merger proposal would trigger the other in response.
In addition, with 2/3 of the US population east of the Mississippi, you can bet that both CN and CP would demand access to major population and business centers in the eastern US as part of any final merger resolution.
SD60MAC9500
The news of CP+KCS is dominating headlines at the moment as it should. This willl create a true North American railway. So where do we go from here? BNSF, CN, CSX, NS, and UP? I’m sure press releases relating to this combination will appear in the news shortly. Though who out of the Big 4 US systems is in shape to make a move East of the Mississippi? BNSF and CSX seem to be doing better than their perspective rivals in their territory. UP and NS are still trying to get their systems through the PSR wringer.
A BNSF+CSX combination might not be a bad idea and may be better than BNSF+NS in reality. BNSF already has rights to North Baltimore, OH ICTF. Both are partners in Schneider National IM Service. CSX has direct access to BNSF’s Corwith IM Ramp in Chicago. They partner on Atlanta-California IM service via Memphis, TN.
UP+NS. I believe these two interchange quite more carload and IM traffic between each other than their rivals BNSF and CSX. Correct me if I’m wrong. NS and UP offer Atlanta IM service via the more direct Meridian Speedway LLC. UP was recently granted trackage rights on the old Wabash between KC, and Springfield, IL.
CN you look to be the odd man out going forward… For now…
This is just a synopsis of current events. So what are your guys thoughts?
REmember back in 1993(?) when the UPRR sent #3985 East to pull the 50th Anniversary Clinchfield Christmas Train { lightly disquised as CRR 176 (?) } The talk at almost every railfan ‘discussion’ centered around the “…Why’d they do that…”.
CSX- UPRR ??? “:What was gonna happen?” “MERGER”??? It seemed to be the burning question in many railfan’s minds at the time…
The trip was a raging success…Even when they tore the corner off #176: nee:3985… when a CSX crew, apparently spotted a car too close to a switch…They just fixed it, and the trip continued successfully… Cooperation between a couple of ‘team players’… The ‘Merger’ never happened, and it got both railroads more ‘good-neighborly’ publcity than either line together, could have bought…
So here we are, almost thirty years (give or take (?) later, and the same subject has become, a possibility, again ! [swg] [:-^]
Slightly over half of Americans participate in the stock market, so it’s disingenuous to imply that the public interest and corporate interests are the same.
Ironically, pretty much every state, county, city, public school district and other governmental employee (not sure about Federal employees) is indirectly invested in the stock market, too. They all have some form of pension plan, usually a state pension plan, that they are a member of. Typically their employer and employee contributions to their pension make up a small minority of benefits paid. The majority of benefits paid are generated by taking those contributions and investing them primarily in stocks and other investment vehicles. I am on the board of a public pension fund and in our fund, 27% of benefits are generated by contributions and the other 73% is generated by investment returns. That is one relatively little-known factoid.
The “slightly over half” includes people with 401K’s and retirement funds that participate in the stock market. Federal employees these days are also involved in the stock market through the Thrift Savings Plan. But it’s still around 55% total participation.