Tom Finkbiner was formerly the head of Triple Crown and then VP Intermodal at Norfolk Southern.
This is an interview with him regarding Tiger Cool Express, which he now heads. Tiger Cool is a 3rd party intermodal refrigerated container operator that is in a growth mode.
In the interview Finkbiner gets it wrong on fuel prices, but it’s an interesting piece from a guy that knows railroading and intermodal.
Saw my first Tiger Cool container recently!
Ken: Very interesting, very critical. Given that oil is now $39.25 (up from $38.50) and some observers think it could bottom out below $30, will that impact Tiger’s expansion plans adversely?
Read the Tom Finkbiner interview posted by greyhounds . I am no expert, by any means, but somehow, I get the feeling that maybe Mr. Finkbiner’s information seems to be somewhat ‘stale’(?).
I live on major lines (BNSF) here in South Central Kansas. I have made no ‘scientific’ study other than to observe the traffic flowing through here. I am seeing IM/EX Container trains with reefer boxes in the concists, more and more with time.
A couple of domestic COFC/TOFC trains in each direction each day. The ‘premium’ ( priced services?) seem to have more and more 53’ reefer trailers on their back ‘halves’. Just my comment. Fuel prices (Diesel) do not seem to have the fluctuations that gasoline has, holding at the $4.00 + range.
Since Mr. Finkbiner is in the business to fill his Company’s Containers; I would not argue his points abouit those aspects of that business. I am just making a casual observation that the traffic throuigh this area of South Central Kansas seems
Not sure how you figure that. Suburban Chicago Diesel fuel has been in the $2.40-2.50 range for months. In Wichita, KS, the average is $2.40 now.
I don’t see a significant adverse impact from the fuel cost decline.
At the distances Tiger Cool is now targeting, 1,000 miles +, rail should retain a distinct advantage. Service quality is the big issue. As Finkbiner said, many or most shippers can live with a day longer. But it can’t be more than that. Especially with a perishable product.
And the rail service has to be consistant. It can’t be hit or miss. Walmart doesn’t want to run out of anything, let alone run out of tomatoes or meat.
Overall the fuel price decline will both hurt and help the railroads. Their own costs will go down, but the rail cost decline will be less significant than the tuckers’ cost decline. The should increase the distance at which trucking is economically competitive with rail movement. But that increase shouldn’t extend out to the distances Tiger Cool is targeting.
The railroads will also loose a significant amount of crude oil, frac sand, and drilling rig component business. But, people should have more money in their pockets after buying the gas they need. It was thought that this would cause an increase in spending on other things. Those other things would require transportation and the rails should benifit from that.
This increase in spending on things other than gas hasn’t much happened yet. People seem to just be driving more and spending the savings they’ve enjoyed on gas purchases to just buy more gas.
Meanwhile, this intermodal trailer has been developed. By a man in Texas. It eliminates the equipment da
That is reflected in the UM surveys of consumers.
Consistent deliveries as scheduled is definitely the key to success. I hope the rails can start shifting to a more time-sensitive, service-oriented operation, because coal is not likely to recover, even if oil, etc. do.
[quote user=“greyhounds”]
schlimm
Very interesting, very critical. Given that oil is now $39.25 (up from $38.50) and some observers think it could bottom out below $30, will that impact Tiger’s expansion plans adversely?
I don’t see a significant adverse impact from the fuel cost decline.
At the distances Tiger Cool is now targeting, 1,000 miles +, rail should retain a distinct advantage. Service quality is the big issue. As Finkbiner said, many or most shippers can live with a day longer. But it can’t be more than that. Especially with a perishable product.
And the rail service has to be consistant. It can’t be hit or miss. Walmart doesn’t want to run out of anything, let alone run out of tomatoes or meat.
Overall the fuel price decline will both hurt and help the railroads. Their own costs will go down, but the rail cost decline will be less significant than the tuckers’ cost decline. The should increase the distance at which trucking is economically competitive with rail movement. But that increase shouldn’t extend out to the distances Tiger Cool is targeting.
The railroads will also loose a significant amount of crude oil, frac sand, and drilling rig component business. But, people should have more money in their pockets after buying the gas they need. It was thought that this would cause an increase in spending on other things. Those other things would require transportation and the rails should benifit from that.
This increase in spending on things other than gas hasn’t much happened yet. People seem to just be driving more a