CSX Acquisition of Pan Am Railways

Videos shot today in vorheesville show no obvious track work on the connector from the Albany main to csx
So the stack trains are not moving off of the Fitchburg any time soon.

the fact that the true im containers currently are typically not exceeding 60 per day each way might have something to do with that.

Yes, I’ve noticed that ns volume is not high right now. But the Albany main is, no matter what, getting new rail via state of NY grant. maybe this is a chicken and the egg problem- better svc via the B&A might generate better volume

Before covid, average daily container counts were over a hundred each way daily.

Any educated guesses as to where the now missing 40 daily containers each way went instead? Trucks? Csx? Lost industry in New England?

i'm sure that a certain amount of loss happened during the covid slowdowns resulting in extra truck capacity and lower rates. but i can tell you the service scheduling was not very good pre csx. but things appeared to get worse under the new post pas world where csx and ns are brothers. partially because some old st t&e people have gone elsewhere probably keolis and possibly csx. one way or another they dont have enough crews to operate the railroad. i imagine csx im along with the bargain trucking interests have been all too eager to eat the crewless ns lunch. while there have been some new sources of traffic on the im operation obviously they pale in comparison to what pas was hauling in the past. I believe that the biggest single loss has to be jb hunt traffic. hub and emp seem to not be quite as down.

From the start NS has been a couple of service-days slower than CSX or truck via Ayer and offering service in only the Chicago/beyond and Toledo lanes, requiring a low-price competitive advantage targeting a limited single intermodal submarket segment with service requirements measured by the day and not by the hour.

~100+/day volume required more-aggressive pricing but, with the shock of coal traffic losses, rates were firmed up/costs reduced w/ Toledo dropped, followed by a hungrier competing CSX successfully transitioned to PSR, leading to lower NS volume via Ayer. Then sequential Covid supply chain disruption congestion, widespread Great Resignation crew shortage, and truckload traffic demand declines have muted overall intermodal volume. In the dry truckload-competitive single intermodal submarket in which NS competes in New England (vs. CSX's 4), Hunt works with NS and CSX, Hub only with NS, and non-asset-owning 3PL's with both railroads EMP vs. UMAX/CSXU.

The new trackage rights agreement will give NS some degree of cost reduction/capacity improvement opportunity to regain share in the Chicago/beyond lane, perhaps offering some measure of new opportunity out of the South as well, but without major additional change won't meaningfully close that substantial east-west service gap with CSX. It will be interesting to see what NS does with and in light of this new opportunity (and any CSX competing, cooperating, or neutral response), and considering the same individual who executed their Pan Am Southern strategy negotiated these trackage rights as a longtime industry-practiced condition of CSX's PAR/PAS acquisition.

QB 52.32 wrote: ↑Tue May 23, 2023 8:18 am From the start NS has been a couple of service-days slower than CSX or truck via Ayer and offering service in only the Chicago/beyond and Toledo lanes, requiring a low-price competitive advantage targeting a limited single intermodal submarket segment with service requirements measured by the day and not by the hour.

Mr QB, I remain astounded how Topper thinks he can compete for Boston area Intermodal traffic, and maybe a Shipper's Routing or two into Maine, with his FRA Class 1 track and height restricted Hoosac Tunnel (I'll take Mr. Newpy's word that cave-ins are presently under control).

What does the tunnel and PAS have to do with intermodal traffic? It's going to be shifted to the B&A.

PAS is Class 2, not 1.

I think the short answer is they aren't going to be able to really compete and a lot of people have questioned why they are going through this whole process instead of just investing in their own railroad. Probably for the same reason they declined to purchase CSX's 50% of PAS: they don't even want to compete.

Mr. Newpy, I think you can tell I'm of same mindset.

Somewhere, there's a shipper, who holds it's in their best interest "to play nice" with Topper and give him Shipper's Routings. I presume he will make rates with whoever (B&E for the moment) operates the former PAS.

Otherwise, good luck B&E scrounging for traffic.

The online PAS traffic won't be a problem, I think B&E is going to do fine there. I just can't wrap my head around going through the trouble to rebuild the Albany Main and then pay CSX exorbitant trackage fees for this IM traffic vs investing in PAS, something the rest of their traffic there would benefit from. It shouldn't come as a surprise I guess at this point with their track record on PAS. They've put in just enough to get out just enough.

In short Mr. Newpy, you hold there is enough on line B&E traffic to make a living - even if Timmy's union busting ST stunt is not long for this world?

I'm not sure how they could have anybody working for them at some reduced ST scale when Chessie paying Conference rates is fifty miles to the South - and she's looking for help.

Gilbert B Norman wrote:Mr QB, I remain astounded how Topper thinks he can compete for Boston area Intermodal traffic, and maybe a Shipper's Routing or two into Maine, with his FRA Class 1 track and height restricted Hoosac Tunnel (I'll take Mr. Newpy's word that cave-ins are presently under control).

Mr. Norman, Topper (NS) has despite handicap and will continue to compete for intermodal via trackage rights instead of via a hurdle-too-high-to-clear Hoosac Tunnel, understanding that it's within the realm of a deregulated marketplace where it's now much more about networks and, for intermodal, stack capability than shipper routing; where New England longer length-of-haul and greater traffic imbalance rail advantage offers some cover for disadvantages and possible opportunity while serving a large consuming population but no likely international container play; and, for which New England is but one, albeit relatively important, market within larger negotiated, differentially-priced, and privately-contracted relationships amongst the players on today's deregulated competitive playing field.

It's the reason Topper hasn't bolted but instead is happy with potentially more oats within his paddock.

How railroads derive value in today's deregulated environment also goes to how Chessie (CSX) with PSR-padded paws may get to the ultimate value they're seeking across a portfolio of possibility "B&M, MEC, BAR/CP-M" (PAR, PAS, MNR/EMRY-NBSR); why unit volume or lading value does not necessarily, in and of itself, translate to higher value within a railroad's business and why garbage has to be considered against containerized internationally-traded high-value goods when appraising what might be "lucrative"; how serving a densely populated area stacks up against serving products of the forest and maritime markets; how high or low to the ground in value the lowest-hanging fruits might yield; and, how each relevant Class 1 might have considered the sale and possibly now views their potential competing and/or cooperating strategic prospects in its light.

It'll be interesting to see how things play out across the entire acquisition over the next couple of decades.

Gilbert B Norman wrote: ↑Tue May 23, 2023 1:17 pm In short Mr. Newpy, you hold there is enough on line B&E traffic to make a living - even if Timmy's union busting ST stunt is not long for this world?

I'm not sure how they could have anybody working for them at some reduced ST scale when Chessie paying Conference rates is fifty miles to the South - and she's looking for help.

I wouldn't give up my seniority for a few more bucks and have to move on top of it. IMHO no one is going to leave B&E for CSX (non-ST). If anything they'll go to Keolis for quality of life improvements as has happened countless times in the past decades. Or leave railroading entirely, an industry wide issue.

NS got $5 million NY taxpayer dollars to rebuild the Albany main, so that mitigates the expense of moving to the B&A to some degree.