CSX-bc and "merger"

What was the purpose of CSXT going to CSX-yn3 paint? When CSXT debuted the CSX-bc paint scheme it was proclaimed that this was the bright and new future of CSXT. Where do some get the idea that UP is going to swallow CSXT? CSXT stock looks pretty good.
http://www.google.com/finance?q=CSX

Don't look for a CSX-UP merger anytime soon. I hate to keep on being negative here...but here's the unvarnished truth as I see it.

CSX is in trouble...partly because of its "deferred maintenance" program but mostly because management cannot see what the neglect to the property and demoralization of the workforce and alienation of the shippers is doing to the company. It's going to cost $million$ to get the physical plant back into some sort of developed-world shape. And eventually the stockholders are going to see that CSX's "record profits" were in effect a bleeding of the company resources, to benefit the Executive Suite with their stock-option programs.

I have some idea other railroads sense something is wrong with CSX as well.

So, assuming UP wants the CSX...it will probably play a waiting game. Why buy the railroad when they can pick it up for NOTHING in Bankruptcy Court? When in fact they can get PAID to take it, PAID to bring the track up to standards?

Conrail was fought over and purchased because it was a very desirable property. Conversely, CSX in its present state is going to be hard-pressed to find merger-partners for the opposite reasons...all is NOT well in Jacksonville.

I tend to agree with the last post, CSX is showing nearly record profits
right now but I do not think it will last.
Deferred maintenance is not a winner for any railroad, I found that out in
the Penn Central period and it eventually cost Penn Central so much to
move their trains that it just wasn't possible to operate profitably. The
structure especially on former Conrail has not detiorated enough yet but it will as they are pounding the crap out of former Conrail routes that until the CSX takeover were in good shape.
Incidentally, the derailment on the Mohawk at Tribes Hill, west of
Amsterdam, has officially been caused by a defective or broken rail, does
that tell us something?
I think CSX is headed the wrong way, just my opinion.
Noel Weaver

I live next to the River Line sub and I'm curious where maintenance is being deferred. There are track cars up and down the line almost every day, not to mention they are building 5 miles of new siding between Kingston and Highland. How differently are the subdivisions maintained?

n2xjk wrote:I live next to the River Line sub and I'm curious where maintenance is being deferred. There are track cars up and down the line almost every day, not to mention they are building 5 miles of new siding between Kingston and Highland. How differently are the subdivisions maintained?

was wondering the samething. the riverline seems to be very well maintained.

and if this was true, who would it affect lets say nysw who is partially owned by csx and ns?

I think it's about debt assumption. After Conrail, CSX was the most undercapitalized of the US Big 4. Damned if you, damned if you don't. The infrastructure needed considerable upgrades in addition to ongoing maintenance, and there was only so much cash there to work with. And the Conrail integration cost more than budgeted as well. The railroad is screwed, if they go out and borrow more, they get punished in the stock market, if they can limp along, without borrowing, in the expectation that rates and volumes will improve, they will generate more cash to fund maintenance in the future.
That's the game. We've seen it fail more often than not in our lifetimes. Hopefully now the record profits will be used to lever additional borrowing in addition to funneling profits back to the business, and Wall Street will accept it.

another reason for the simpler yn-3 is purely cost. bc had three colors and had to be masked etc for each color. yn-3 is one shot allover blue, slap some yellow on the ends and white on roof and you're done.

What color the locomotives are painted does nothing to help the railroad
and in fact costs money.
It is far more important to maintain the property than it is to paint the
locomotives. My concern is not how the locomotives look, it does not
matter but rather how well the raillroad is being maintained.
Cutbacks in maintenance might not be noticed too much the first year or
two but after that, they are like a cancer that keeps spreading. Repair or
rehab. of deferred maintenance is a very costly affair and in the mean-
time, slower operating speeds can also affect the cost of operation of
various trains. Eventually maintenance cutbacks will come back to haunt
the company very badly.
Noel Weaver

FYI, as of todays date: the Mohawk Sub (Amsterdam - Syracuse)has 23 Temp. slow orders( of these 2 due to tribe hill wreck, 2 due to flood damage repairs), Rochester Sub (Syracuse - Depew) has 28 temp. slow orders, and The St. Lawrence Sub, (Syracuse - Massena NY) 36 temp. slow orders. With the exception of 2 for the tribes hill wreck repair and 2 for the flood damage repair, the rest are maintainance issues, majority of which have been in place for several months without attention. Yes, the track cars patrol nearly every day. The patrols watch for problems to manifest and report problems. It's up to the section Roadmaster to schedule and fix defect.

roadster wrote:FYI, as of todays date: the Mohawk Sub (Amsterdam - Syracuse)has 23 Temp. slow orders( of these 2 due to tribe hill wreck, 2 due to flood damage repairs), Rochester Sub (Syracuse - Depew) has 28 temp. slow orders, and The St. Lawrence Sub, (Syracuse - Massena NY) 36 temp. slow orders. With the exception of 2 for the tribes hill wreck repair and 2 for the flood damage repair, the rest are maintainance issues, majority of which have been in place for several months without attention. Yes, the track cars patrol nearly every day. The patrols watch for problems to manifest and report problems. It's up to the section Roadmaster to schedule and fix defect.

Yes. The Lakeshore Sub has a similar number. Many of those "TSRs" (temporary speed restrictions) have been in place for more than four months. And very frequently slow orders are dropped for a few hours and then reinstated to show on recordkeeping as "new" TSRs. (The Dispatcher's Bulletins show the date each TSR was put in place)

Erie West Sub has only a few TSRs but MANY places where the rail is rough enough to knock you out of your seat at 50 mph. The rail is wobbly to the naked eye. Parts of the track look to be "kinked" in the manner of a steam locomotive running over design speed, many years ago.

Patches are on the welded rail, frequently short pieces less than ten feet long, which are obviously out of gauge and not placed with care. There are mudholes that bounce enough to almost grab air.

Many of these problems and TSRs are in interlockings. Going from Buffalo to Willard, we have slow boards at: CP 15 (four months; 25 mph); CP 31 (forty mph and two months) CP 39 (very rough interlocking; they've put 40 and 25 boards up and taken them down again and again); CP 42 (40); CP 47 (40); CP 49 (40); and here and gone again and again at CP 58 and CPs 85 and 89.

This while the track gangs are making a big show of replacing ties along the line. Well, they oughta...it's been SEVEN YEARS since any major tie replacement.

Bottom line is, Dontgiveadamn-itis infects the entire operation from the top office to the guy swinging a spike mall. They're spending money, but not enough, and not in the areas that really need it. Drainage is a major problem along the Water Level Route; it always has been and predecessor railroads had to always be on top of it. Today we're getting half-mile stretches where the ties are pumping mud.

Sad part is, when you get over to Greenwich Sub, you can see tangent track that has mostly held up over the last seven years. Just when you've decided that that lateral-motion indicates grooves worn in the drivers or a worn-out truck, you roll onto an eight mile stretch where everything rides as smooth as silk. The problem is out-of-gauge track; mudholes; sprung interlockings, and other evidence of zero maintenance.

I still have one or two old bulletin orders from my Conrail days and we
would have maybe one or two slow orders where rehab work was
actually taking place but we did not have slow orders for neglect or
deferred maintenance or NO maintenance.
Incidentally, to some of you who do not work for the railroad and do not
ride over the same line on an almost daily basis, often times the track(s)
look good to an untrained eye but they are not necessarily good and
often ride rough which almost always indicated a problem.
I think it would be reasonable to expect that in the next two or three years
that derailments and other problems will be on the increase and every one
of these problems cost the railroad money, not a positive outlook.
At this point, I won't really touch on the way the CSX is treating their
people except to say that that is not a positive either.
Noel Weaver

Yes, before CSX took over a 10mph temporary slow order wouldn't last at most more than 24 hrs. Now it can be months, and I seen one take years for CSX to fix.

Noel Weaver wrote:I still have one or two old bulletin orders from my Conrail days and we
would have maybe one or two slow orders where rehab work was
actually taking place but we did not have slow orders for neglect or
deferred maintenance or NO maintenance.
Incidentally, to some of you who do not work for the railroad and do not
ride over the same line on an almost daily basis, often times the track(s)
look good to an untrained eye but they are not necessarily good and
often ride rough which almost always indicated a problem.
I think it would be reasonable to expect that in the next two or three years
that derailments and other problems will be on the increase and every one
of these problems cost the railroad money, not a positive outlook.
At this point, I won't really touch on the way the CSX is treating their
people except to say that that is not a positive either.
Noel Weaver

Remember that Conrail, for most of it's life, had good old Uncle Sam helping them. Tons of money. CSX is using their own capital.

cw cabin wrote:Remember that Conrail, for most of it's life, had good old Uncle Sam helping them. Tons of money. CSX is using their own capital.

This is not a true statement. Conrail had a boost from the government for a few years only, helping them to recover from the many years of neglect and underinvestment that came before. By the time they were in the black and going forward, they used capital from earnings to keep the physical plant and equipment in excellent shape.

It is commonly known that CSX has chosen to hold back on modernizations and maintenence to their overall system and track structure over the years.

Ah, not exactly...

Respectfully, I think you're confusing things. While you're right that Conrail was sold to the investor community after they were restored to profitability, no huge debt burden was assumed in this transaction. Later on, CSX had to borrow money to buy its share of Conrail. The premium they paid for 42% is truly well documented. That has been a large part of their problem, they can't borrow any more money at optimum rates, so they have not reinvested in infrastructure or equipment until they began to retire this debt.
I don't believe this is willful neglect, nor do I believe that their assumption of this initial debt was a good thing. But it's the world they operate in now. If the borrow another billion a year for the next 3-5 years for infrastructure, their financial statements will look worse, and their stock price will get pummeled. Again, I'm not saying that's right or wrong, but that's the environment a publicly traded company lives in.