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Progressive Rail Closing More Of Their Rail Lines ?
Author: Pink Slip
Date: 07-04-2020 - 12:08
According to Trail Now, Progressive Rail will be pulling out of 4 of their rail operations due to financial distress.
Trail Now posted the following today. Brian Peoples has been claiming that Progressive Rail’s CEO has been working with him and providing the company’s financial details.
“Since July/2019, Trail Now has been talking to Progressive Rail to make a deal to use the property north of Watsonville for a trail. Progressive Rail was very supportive because they viewed it as an opportunity to reduce their liabilities. In November, 2019 Progressive was overextended on their credit - paying 18% on some loans and in order for the bank to agree to refinancing, the bank required them to bring former CEO Lon VanGemet back to right the ship. Trail Now had multiple meetings with Lon who was all about just getting the freight train business going. For example, Dave Fellon (President) had mentioned to Trail Now that they were looking at setting up a freight for the Santa Cruz Dump - and when Trail Now discussed this with Lon - he said that there was no possibility of such a freight business. In March, 2020, Lon and Trail Now had multiple discussions and Lon stated Progressive Rail has 13 raillines and 4 of them are on the "bubble" to be closed; Watsonville is one of them. All of this was before COVID-19. Progressive Rail had 300 carloads in 2019 and for a shortline operator to be profitable, they need to run 1000 carloads a year. Conclusion – Progressive Rail is trying to close Watsonville freight because of poor business – not because of RTC claim of trespassers on rail corridor.”
Trail Now posted the following today. Brian Peoples has been claiming that Progressive Rail’s CEO has been working with him and providing the company’s financial details.
“Since July/2019, Trail Now has been talking to Progressive Rail to make a deal to use the property north of Watsonville for a trail. Progressive Rail was very supportive because they viewed it as an opportunity to reduce their liabilities. In November, 2019 Progressive was overextended on their credit - paying 18% on some loans and in order for the bank to agree to refinancing, the bank required them to bring former CEO Lon VanGemet back to right the ship. Trail Now had multiple meetings with Lon who was all about just getting the freight train business going. For example, Dave Fellon (President) had mentioned to Trail Now that they were looking at setting up a freight for the Santa Cruz Dump - and when Trail Now discussed this with Lon - he said that there was no possibility of such a freight business. In March, 2020, Lon and Trail Now had multiple discussions and Lon stated Progressive Rail has 13 raillines and 4 of them are on the "bubble" to be closed; Watsonville is one of them. All of this was before COVID-19. Progressive Rail had 300 carloads in 2019 and for a shortline operator to be profitable, they need to run 1000 carloads a year. Conclusion – Progressive Rail is trying to close Watsonville freight because of poor business – not because of RTC claim of trespassers on rail corridor.”
Progressive Rail Closing More Of Their Rail Lines ?