March 12, 2006

BACK ON TRACK:

Railroads back on track for freight, profit (Ronald D. White, 3/12/06, Los Angeles Times)

After years of retrenchment, railroads across North America are reporting record profits and rolling forward with massive expansion projects of the kind that haven't been seen in decades.

The growth has been fueled by a continuing flood of cargo containers filled with Asian products, which ended the coal industry's 102-year streak as rail's biggest revenue generator in 2003 and has surged farther since then.

Railroads are gaining ground on the rival trucking industry, which is suffering from sharply higher diesel costs and a shortage of long-haul drivers.


In retrospect the Motor Age will be seen as a mistaken sidetrack--thankfully a brief one.

Posted by Orrin Judd at March 12, 2006 7:36 AM
Comments

Dream on.

Posted by: erp at March 12, 2006 8:13 AM

This article makes me think the Dakota, Minnesota, and Eastern railroad may have asked for private financing too soon. Their expansion plans into the Powder River coal basin have to now be facilitated by a federal railroad rehab loan engineered by Sen. John Thune (R-SD). That is about $2.5 billion being shelled out by the taxpayers when it may have not needed to be, if DME was willing to wait a little longer.

Posted by: Brad S at March 12, 2006 11:33 AM

Railroad stealing business from the trucking industry makes sense for long distance distribution. However the closer you get to the final destination the less sense railroads make. And there is also the time factor - can you have perishable goods sitting on a train for a week while it winds its way to its destination?

Posted by: AWW at March 12, 2006 2:07 PM

I love oj's transportation-humor posts. :-)

Posted by: Kirk Parker at March 12, 2006 3:46 PM

But, as the article implies, containers are perfect for mass transportation to distribution points where the trucks take over. That's market forces you hear humming in the background.

Posted by: Genecis at March 12, 2006 3:59 PM

Let the railroads and the truckers compete without subsidies and regulations and restrictions and let the best mode of moving goods win.

Posted by: erp at March 12, 2006 4:56 PM

Railroads are the best way of moving freight long distances, but they can't handle the current volume, and as for "just-in-time"...

Ha !

Posted by: Michael Herdegen [TypeKey Profile Page] at March 13, 2006 2:35 AM
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