Re: DM&E
Author: E
Date: 01-31-2009 - 12:46
This brings up another point (Thanks, Sammie).
In all of slobbering and bloviating about the proposed DM&E Powder River Basin coal line, there are some things I have not been able to reconcile.
For example, the new line is supposed to result in lower rates. But DM&E would be paying the same prices for track materials, construction, fuel, locomotives and labor as the BNSF and UP do. In addition, DM&E admitted several times that they needed the revenue from the PRB line to prop up the rest of their system which, surpise, cannot make it on it's own in the long term (which is why it was unloaded by the class 1's in the first place).
So the question I would have is how would they be able to cut the rates any lower than BNSf or UP when their basic and operating costs are virtually the same, plus they have to support the rest of railroad from that revenue?