Truck driver retention, fuel prices impact rail demand
Jul 27, 2006 10:38 AM
Railroad demand during the autumn is expected to hike as a result of several factors, including the trucking industry's problems with rising fuel prices and driver retention and recruitment, according to information from the Surface Transportation Board (STB).
Michael J Ward CSX president, said in a letter to the STB: "CSX and other Class I railroads are experiencing strong demand across virtually all markets, and this is expected to continue. Increases in industrial demand and imported products, combined with congestion on the highways, rising fuel prices, and a shortage of over-the-road truck drivers, will continue to push freight to fuel-efficient railroads."
In June, the STB sought railroad company plans for handling the peak shipping season and noted at the time that there is heightened focus on the issue this year because of a healthy domestic economy, growth in import/export traffic, the agriculture sector's forecast of record harvests, and the fact that rail infrastructure has begun to show capacity constraints.
Responses to the STB request were received from the major railroad companies: Burlington Northern Santa Fe Railway Co (BNSF), Fort Worth TX; Canadian National Railway Co (CN), Montreal, Quebec, Canada; Kansas City Southern Railway Co (KCS), Kansas City MO; Norfolk Southern Corp (NS), Norfolk VA; CSX Corporation (CSX), Jacksonville FL; Union Pacific Corp (UP), Omaha NE; and Genesee & Wyoming Inc (G&W), Greenwich CT. Also responding was the American Short Line and Regional Railroad Association with remarks from its members.
Railroad companies noted their efforts to expand infrastructure, add equipment, and boost their workforces in order to handle expected growth. "Between 2002 and 2006, BNSF will have invested almost $10 billion to maintain the quality of our infrastructure and to provide additional capacity, not including freight car acquisitions," said Matthew K Rose, BNSF president. "More than 33 percent of that total is devoted to expanding our locomotive fleet and our main lines and terminals."
Arthur L Shoener, KCS president, said that at the end of 2005 and in the early months of 2006, KCS was completing its recovery from the hurricanes that took place along the Gulf coast. Today, train velocity and overall fluidity on KCS has recovered. "KCS is operating as well as it has in recent years," Shoener said. Jim Young, UP president; E Hunter Harrison, CN president; and Mortimer B Fuller III, G&W president, said they do not anticipate significant problems resulting from the autumn schedules.
However, hazardous materials liability concerns was voiced by C W Moorman, president of Norfolk Southern. "I understand the concerns that federal, state, and local governments have with the transportation of hazardous materials. But all parties need to recognize that efforts to ban or restrict the routing of hazardous materials would affect adversely and significantly the rail network."
The representative for the short line and regional railroads, Richard Timmons, said that he had surveyed key short lines engaged in port and terminal operations and significant interchange with the Class I railroads. "All reported that they do not anticipate congestion, delays, or interruptions at any time during the remainder of this year, so long as the Class 1's maintain their service schedules."
To see all the responses, click here for the STB Web site.
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