The Pacific Northwest Association of Rail Shippers (PNWARS) recently held their annual conference in Portland. Conference attendees are the biggest movers and shakers in the train industry. The railroads were well represented by executives from Union Pacific Railroad, CSX Railroad, Norfolk Southern Railroad, and Burlington Northern Santa Fe Railroad. A handful of regional shippers faced off against the railroads: Longview Fibre, Lafarge, and Weyerhaeuser. Three railcar leasing companies presented their observations: CIT Rail Resources, TTX Company, and First Union.
CSX Transportation's Executive Vice President, Clarence Gooden, was the key note speaker of the conference. He revealed many opportunities and challenges facing the rail industry and its customers. Problems in the trucking industry that will result in increased rail use include driver shortages, congested highways, hours-of-service regulations, and tightening emission standards. The railroad industry has many of its own hurdles to overcome. Rail customers have widely varying needs. Meeting those needs can often present significant challenges for the railroads.
One example given was cement plants requesting special railcars specifically for cement. Another example was two different types of sand shipped by rail. Sand is difficult to carry and therefore expensive to ship. The cost of shipping valuable sand represents a small portion of the overall cost. The cost of shipping common sand can exceed the total value of the sand. Recent weather-related phenomenon has hindered rail transportation. Hurricane Katrina generated 31-foot tall waves that reached 10-miles inland. The hurricane wiped-out 26-miles of rails and 28 railroad bridges, each 2-miles long, along the Gulf of Mexico. Although most of the hurricane damage to the railroads has been repaired, railroad reliability continues to be hindered by operating at maximum capacity with little room for adjustments. A question was raised following Clarence's introduction speech "What about Amtrak?" Clarence's response was a chuckle followed by...