Why don't Class Is let others run "classic" freight trains?

In reading the "American Railroads" book profiled in another thread, and from my general industry knowledge (which is limited), it looks like Class Is have largely given up on "classic" freight trains. Trains with less-than-carload traffic and non-unit/non-intermodal freight trains are going, going or gone from Class Is.

If shortlines can make money hauling "classic" freight trains, on tracks where there is excess capacity, why don't Class Is let shortlines pay for trackage rights and haul "classic" freight trains on Class I routes?

Or do I have my facts wrong: do Class Is still operate enough "classic" freight trains to capture all business that's available for them, or do they give shortlines trackage rights already?

Thanks.

Class I's operate "classic" freight trains consisting partly of cars received in interchange from the short lines, which are of considerable importance nowadays in assembling and distributing "loose cars" having line-haul movements on the Class I's. LCL traffic nowadays moves almost entirely in trailers and containers on the Class I's. When you see a solid train of doublestacks with names like UPS and J. B. Hunt, you're looking at a lot of LCL.

Single car railroading is high cost. Class 1's work hard at squeezing the cost out of their services. Unit movements are low cost when compared to single car operations. From the customer standpoint, single cars pay a higher rate than unit rates when compared on a per car basis.

Railroads are in the business of making money in the most effective ways possible - not running 'traditional' trains for railfans.

SR,

You need to consider the Class One railroads as dealing in the "wholesale" side of the industry. It is more cost-effective for them to haul the maximum number of cars while minimizing the handling of individual cars. This means reducing the number of stops enroute, and the number of customers served per train.

The logic of running unit trains at a reduced rate per car is based on savings due to reduced individual car handling.

The non-class one railroads are set up to be the "retail" side of the industry. They will gather and distribute the individual cars to non-unit train customers. They will do this at a profit because their costs are lower than that encountered by the Class Ones.

Some small railroads do a profitable business by delivering or receiving unit trains from Class One connections. Often these trains come with Class One power and the Class One buys the fuel.

Class Ones are also in the loose car business, even though they might prefer not to be. They will run local freights to serve small shippers on line they have not been able to discourage.

Conversely, small railroads will encourage small shippers as they work to expand their traffic base.

In answer to your question, why don't Class Ones allow small railroads to serve small shippers on the Class One's own lines? Probably for two reasons: union objections to having other railroads (often non-union railroads) poaching their traffic and jobs. And a desire not to have another railroad tying up their lines with local freights switching customers. Some Class Ones will allow a small railroad to operate trains over their lines, if these are run as overhead traffic and no work is done while on the Class One's track.

With deregulation, railroads have a lot of freedom to decide who they will service and who they won't.

The relationship between the Class Ones and the smaller railroads connecting with them is like the relationship between the Class Ones and the unit train customers. The small railroads receive blocks of individual cars to distribute and deliver blocks of individual cars like unit trains.

Les

This could turn into a pretty stimulating topic:

It might be noted that until "ubiquity" railroading (loose cars, siding-to-siding service, to summarize - anything, in any quantity, from anywhere, to anywhere) began to deteriorate after World War II, the rail carriers had a lot bigger share of the market as a whole, and the more sensitive traffic, merchandise, LCL, forwarder, perishables, livestock, etc. was, of course, the stuff which contributed the most toward the "overhead" -- maintenance, property taxes, etc. That traffic was the first to be lost to highway competition, which reduced revenue. which required service cuts, etc, and the vicious cycle began.

Probably the only thing that halted the slide was the recognition by all the major players -- Class I's, labor unions, Wall Street, governments at every level, even academics -- that if a drastic restructuring was not undertaken, the entire system would be nationalized -- run from there on out by the rules of a bureaucracy, rather than an enterprise. But somehow, the right pieces fell into place, and six or seven major players (depending upon who's counting) backed up by a "second team" of short-lines, regionals and some entities on the border between the public and private sectors, put together something that works.

Some of us at this site, which I used to refer to as "our little Parliament", have been watching the game for fifty years or more; some others are too young to remember some of the things we've lost that made the earlier times so interesting. But the point is that the basic technology behind it has endured, and holds tremendous potential.

Personally, I suspect that no major change will come until after the completion of PANAMX; that might divert a lot of transcontinental traffic to places like Savannah and Hampton Roads (NS appears to be anticipating this) AND free up some capacity on the big 2-main-track, bi-directional western main lines where capacity (and the safest, most-efficient way to expand it) has been an emerging issue. Under those conditions, some even bigger infrastructural underpinning, with public-sector consent and participation, seems inevitable (There's a thread somewhere here called "If I Had a Billion" that might interest a few people as well). Any number of experimental marketing strategies, like the stillborn Reading "Bee-Line Service'" (ironically, immortalized on one of the NS Heritage units) might re-emerge someday. All the tools, and more leverage within the public sphere, are there, and that is sufficient.

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It's been forty-five years since I was an undergraduate majoring in Business Logistics, and dabbling in Transport Economics and libertarian activism on the side. In those days, no one thought of freight railroading as a growth industry. That idea is no longer en vogue.

SouthernRailway wrote:In reading the "American Railroads" book profiled in another thread, and from my general industry knowledge (which is limited), it looks like Class Is have largely given up on "classic" freight trains. Trains with less-than-carload traffic and non-unit/non-intermodal freight trains are going, going or gone from Class Is.

If shortlines can make money hauling "classic" freight trains, on tracks where there is excess capacity, why don't Class Is let shortlines pay for trackage rights and haul "classic" freight trains on Class I routes?

Or do I have my facts wrong: do Class Is still operate enough "classic" freight trains to capture all business that's available for them, or do they give shortlines trackage rights already?

Thanks.

I recall reading that Norfolk southern had some areas where they essentially subcontracted local freight services to a regional or shortline operator. I do not know how widespread a practice that is on there network.
You are correct about LCL business being gone from the RR's but there are still plenty of manifest freights, granted they feature many more bulk cars (covered hoppers, tank cars) in their consists than boxcars these days but here in Southern New England that is the predominate type of traffic.