Potential PAR/PAS Traffic Growth

QB 52.32 wrote: ↑Mon Jan 16, 2023 8:17 am It will be interesting to see if/when/how B&E will be able to bring back via Gardner the significant ~2,500+ carloads of P&W traffic taken over to CSX via Worcester within the past year, as Mr. Barlow pointed out, any other P&W traffic CSX has chipped away at since PSR implementation, or even CSX business rumored in the past year to be shifting over more generally to PAS but failing to materialize.

Probably right after CSX "chips away at" all the tonnage that's moved to trucks since PSR was implemented.

I doubt the racks will come back, that route can't compete.

Please, do share those "tonnage" reports, I'd like to read not only some specific examples of "tonnage lost to trucks" here in New England since CSX implemented PSR but also those examples of new "tonnage" as well in balance since that's surely part of the picture. I also would like to see your "analysis" as to why "that route" can't compete for P&W auto traffic when, in fact. it did prior to... CSX's successful implementation of PSR (and systemwide network degradation of service among all rail carriers, including Pan Am Southern, coming from Great Resignation labor shortages).

But to the bigger more important point, don't let the simple fact escape you that only after applying PSR principles is CSX able to expand and invest in PAR (and in its best physical condition) as is the case with CP and "the Moosehead" after years of retrenchment and disinvestment. Railroading is a long game beyond the past 6 years since CSX adopted PSR and the few since a consequential 100-year pandemic hit and as such has to considered in those terms.

Why are you quoting every other word?

The tonnage report is a morning report that is a compilation of Production Summaries - number of cars in each yard, job OD times for the next 24 hrs, cars switched, etc. Transfer Reports shows cars interchanged at each gateway.

This information is given to me in confidence and there it shall remain. But what you're looking for is some type of market analysis, not an operational report like this. As for the merits of PSR, you can keep those.

Here's what CSX stated re: anticipated change in ton miles in its revised, much more detailed 7/1/21 filing with the STB (302666) in response to STB's declaration that CSX acquisition of PAR was NOT a minor transaction.

Text excerpts from 302666:

The gross ton-miles per year on the Northern Route will be reduced by the diversion of the pair of NSR intermodal/automotive trains to the Southern Route. However, that reduction will be offset to some extent by an increase in gross ton miles per year on the Northern Route resulting from CSXT’s diversion of traffic from the Southern Route to the Northern Route, as discussed above. The result is a net decrease in gross ton-miles per year on the portion of the Northern Route through Mechanicville (the point of interchange with NSR).

and

The gross ton-miles per year on the Southern Route will be increased by the diversion of the NSR intermodal/automotive train pair from the Northern Route. However, that increase in gross ton-miles will be offset to some extent by the reduction of gross ton-miles per year from the CSXT traffic that will be diverted from the Southern Route to the Northern Route, as discussed above. The net effect will be an increase in gross ton-miles per year on the Southern Route as shown in Attachments 2 and 3 to Exhibit 4-A.

Also note that CSXT's commitment to move Ayer bound traffic back to the Northern Route is temporary for an amount of time that was redacted in 302666.

QB 52.32 wrote: ↑Mon Jan 16, 2023 4:48 pm Please, do share those "tonnage" reports, I'd like to read not only some specific examples of "tonnage lost to trucks" here in New England since CSX implemented PSR but also those examples of new "tonnage" as well in balance since that's surely part of the picture. I also would like to see your "analysis" as to why "that route" can't compete for P&W auto traffic when, in fact. it did prior to... CSX's successful implementation of PSR (and systemwide network degradation of service among all rail carriers, including Pan Am Southern, coming from Great Resignation labor shortages).

But to the bigger more important point, don't let the simple fact escape you that only after applying PSR principles is CSX able to expand and invest in PAR (and in its best physical condition) as is the case with CP and "the Moosehead" after years of retrenchment and disinvestment. Railroading is a long game beyond the past 6 years since CSX adopted PSR and the few since a consequential 100-year pandemic hit and as such has to considered in those terms.

QB, your defense of PSR and then to put the blame for operational problems on the labor, reminds me of the russian bots on other forums I follow that defend the invasion of ukraine...

Mandy Saxo, I am defending PSR (principles) as a tool, not necessarily how it has been used in a variety of ways and across the resulting impacts upon the various constituencies (including labor) in the shorter run, all in pursuit of the most important strategic opportunities and in meeting the most important strategic challenges which will lead to the biggest repercussions to those constituencies over the long run.

That is an important distinction that has to be made and is obviously being made by Class 1 railroad managements. As has been said, a shovel can be used to dig a well to quench thirst or to kill a brother.

Unfortunately, you are making the jump as to who you perceive I'm blaming for the problems arising from a labor shortage when, in fact, I am not and fully aware that the issue has multiple contributing factors among all the players, though not the least the dynamic of the Great Resignation seen all across the economy and not only with PSR and non-PSR railroads alike.

In the attached spreadsheet, I attempted to estimate absolute tonnage in Million Gross Tons/Year per segment of the Northern Route and Southern Route for 2019 and 2022 by simply dividing the CSX/PAS MGTM (annual Million Gross Ton Miles) figures in the table from the CSX filing 302666 of 7/1/21 by the mileage of each listed segment. Clearly the CSX Southern route hauled quite a bit more tonnage than the PAS Northern Route in 2019 EXCEPT to/from Ayer. And the tonnage difference is expected to get bigger after PAS ops are spun off to G&W and NS reroutes its pig/auto traffic between Voorheesville and Ayer as Northern Route tonnage to/from Ayer should decrease by almost 50%.

Looking at the average tonnage per route, it seems intuitive why NS might have ruled out outright ownership of PAS as it would not produce revenue close to what the southern route generates.

I don't think it ever came down to comparing the two routes in total tonnage. I think it came down to whether NS deemed it financially worthwhile to invest what is necessary (and take full ownership) to move their highest priority traffic in a double stacked manner expeditiously without any other operator or part owner getting in the way. Obviously, we have the answer to that, but there are a couple of variables/omitted items that could have swung the pendulum one way or another:

-This does not include the (unknown ?) costs to rebuild the Albany Main or any clearance improvements deemed necessary on the Worcester Main.
-This does not include unknown (but reportedly very high) trackage right fees that CSX is getting to move NS's trains.
-This does not include any potential costs to fully clear the Hoosac Tunnel if the state was not going to help on that.

I personally think it's crazy that they are going through the trouble of diverting these two trains over someone else's railroad, but I don't have access to the break-even comparison. Furthermore, for all of the arm waiving about PSR and its benefits I would argue that PSR is exactly what prevented NS from acquiring full ownership of PAS. Why own assets when you can lease? It looks better on paper even if it actually isn't. I would even go down the rabbit hole one step further and say if PSR was implemented at NS earlier there is no way that the D&H South would have been acquired. We've seen there in plain set how that route has been rationalized in the name of lowering the OR even if it means asinine operating practices.

Morale of the story, even with the divestiture of the NS intermodal jobs I believe PAS is ripe for an operator like GWI, (who owns several connecting shortlines and possesses a strong marketing department) to be a strong and profitable operation. It just didn't make sense for NS...

State of Mass brochure on the Double Stack Project:

https://archives.lib.state.ma.us/bitstr ... sAllowed=y

Among all of the issues arising from this transaction and the other big investments being made around it, future ownership and function of PAS (B&E) will be one of the most interesting to watch.

Since PSR is a tool and railroad behavior is informed by the most essential long-term characteristics, like being a capital-intense network business with multiple lines-of-business, I'd say the latter is more in play than the former.

As a tool, PSR is and can be used to lower the operating ratio in segments of a railroad's business to then provide greater latitude in cross-subsidizing other segments to achieve an overall strategic growth and operating ratio target. This essentially is part of NS' strategy moving forward, using PSR for benefit in their carload and bulk business to cross-subsidize and leverage growth in their competitive-advantaged intermodal business, all toward strategic growth and an overall operating ratio target.

If one holds the position of weighting PSR over those basic railroad characteristics, it loses steam when considering CSX's move in buying more assets and making a substantial long-term investment in those assets.

I still question whether NS will actually move the intermodal traffic to the B&A. There are so many costs. Rumors were posted here a few weeks ago of a rail train headed for the Albany main. Until there are confirmed reports of reconstruction in progress of the Albany main and raising clearances north of Worcester, I remain skeptical

There are pictures on FB of them dropping rail west of the cross at Voorheesville

Well there you go! Thanks
So much for my skepticism

Yes it has begun, this was sent to me by a friend. This is Prospect Street (just west of the old diamond with the Selkirk Branch at VO).

bostontrainguy wrote: ↑Wed Jan 18, 2023 8:59 am State of Mass brochure on the Double Stack Project

Price tag is $300 million. When you look at what it took within all of the overhead clearance projects during the past ~40 years, including $80 million for full B&A/"southern route" overhead clearance, with a $50m Commonwealth of MA and $30m. CSX contribution for more and less-risky benefit than PAS, you can see why this is one of the last left. Out of the deal NS gets the benefit and mitigates the capital cost in a big way of having full overhead clearance for their New England intermodal business and, as I see it, a greater strategic chance ultimately for public funding for the project to the extent of CSX's PAS ownership and relationship.