by Gilbert B Norman
Likely most here are aware that Fred Frailey, who in the interests of full disclosure I should note I have met face to face "along the way', has now become a columnist at TRAINS. His "lead off" in the July issue can only be considered by this observer of railroad industry affairs for something approaching sixty years as "ominous'.
Quite succinctly, Mr. Frailey holds that even when the the economy by any recognized measurement returns to pre-recession 2007 levels, the Ports of Los Angeles/Long Beach will not follow suit. He cites various reasons such as opening of expanded maritime facilities at Prince Rupert, and presumably as well in Mexico, and the expansion of the Panama Canal so that PANAMAX (maximum dimensions of a vessel to transit the Canal) will include any vessel, other than a VLCC - Very Large Crude Carrier, in today's Registry.
If there is any foundation to Mr. Frailey's thoughts, and considering his demonstrated astuteness with regard to industry affairs such could well be the case, this is indeed foreboding to the East-West carriers - and that of course means BNSF and Union Pacific.
The "Land Bridge" concept of handling container traffic never materialized as maritime companies have shown they want to keep their traffic in their hulls to the fullest extent possible. East-West container traffic through LA/LB has represented a Land Bridge of sorts; while the "spin docs" in both Fort Worth and Omaha are putting out "don't worry be happy', who knows what thoughts are held upstairs in the corner offices. Possibly indicative is that the column notes the UP double-tracking of the Sunset Route is presently on-hold; so much for confidence in what the future will bring. All too much of the prosperity both BNSF and UP have enjoyed during the industry's renaissance has come from the distant line hauls of high valued export-import traffic.
If there is to be a realignment in the movement of "ex-im" traffic in which maritime transport will be used to the fullest extent possible, will suddenly highway transport have a rebirth at the expense of rails? Quite unlikely; even if convenience is there, the economics are hardly so. The winner will be NS and CSX as they serve the East Coast ports that expect to "win'. However, one can only hope, especially in the latter case, they will be "up to the job'. If Prince Rupert, which lest we forget is closer to any Asian port than is LA/LB, is to become a major West Coast port, there is only one player in town for that one. The KCS, with their substantial investment in the privatized Mexican rail system, and whoever they end up merged into (I cannot foresee the KCS continuing as an independent; the only question is who) will win "big time' as such could become the most favorable line haul a North American carrier could enjoy from "ex-im" traffic.
This will indeed be interesting; stay tuned.
Quite succinctly, Mr. Frailey holds that even when the the economy by any recognized measurement returns to pre-recession 2007 levels, the Ports of Los Angeles/Long Beach will not follow suit. He cites various reasons such as opening of expanded maritime facilities at Prince Rupert, and presumably as well in Mexico, and the expansion of the Panama Canal so that PANAMAX (maximum dimensions of a vessel to transit the Canal) will include any vessel, other than a VLCC - Very Large Crude Carrier, in today's Registry.
If there is any foundation to Mr. Frailey's thoughts, and considering his demonstrated astuteness with regard to industry affairs such could well be the case, this is indeed foreboding to the East-West carriers - and that of course means BNSF and Union Pacific.
The "Land Bridge" concept of handling container traffic never materialized as maritime companies have shown they want to keep their traffic in their hulls to the fullest extent possible. East-West container traffic through LA/LB has represented a Land Bridge of sorts; while the "spin docs" in both Fort Worth and Omaha are putting out "don't worry be happy', who knows what thoughts are held upstairs in the corner offices. Possibly indicative is that the column notes the UP double-tracking of the Sunset Route is presently on-hold; so much for confidence in what the future will bring. All too much of the prosperity both BNSF and UP have enjoyed during the industry's renaissance has come from the distant line hauls of high valued export-import traffic.
If there is to be a realignment in the movement of "ex-im" traffic in which maritime transport will be used to the fullest extent possible, will suddenly highway transport have a rebirth at the expense of rails? Quite unlikely; even if convenience is there, the economics are hardly so. The winner will be NS and CSX as they serve the East Coast ports that expect to "win'. However, one can only hope, especially in the latter case, they will be "up to the job'. If Prince Rupert, which lest we forget is closer to any Asian port than is LA/LB, is to become a major West Coast port, there is only one player in town for that one. The KCS, with their substantial investment in the privatized Mexican rail system, and whoever they end up merged into (I cannot foresee the KCS continuing as an independent; the only question is who) will win "big time' as such could become the most favorable line haul a North American carrier could enjoy from "ex-im" traffic.
This will indeed be interesting; stay tuned.