Re: Old Oakland W.P. Rehab
Author: SP5103
Date: 01-06-2020 - 12:02
>Why put so much $'s into a line that might get 300 (Guessing) cars a year?
Because it's cheaper than a derailment or fines! And if we are talking a short length of track, it could be those "only 300" (?) cars are either long haul or high profit cars for UP. If they don't have direct rail service, who says since the customer has to truck it to a transload they wouldn't just truck it to a BNSF transload instead or just leave it on a truck?
Shortline Sammie and most shortlines would gladly work to keep most customers for another 300 cars a year. THink about it - the same volume would require 900-1200 trucks. According to an investor rule of thumb, you need 100 cars per mile annually to be profitable, though I have worked for a few shortlines that were able to survive on a lot less.
I'm not saying every customer is worth it, but it is somewhat expensive and potentially fraught with political issues to abandon service to an active customer, especially since we're talking a few blocks not 25 miles of track.