Re: 1990 Film: "Total Transportation", Southern Pacific Marketing is essential in truly competitive markets.....
Date: 03-17-2023 - 08:27
Re: 1990 Film: "Total Transportation", Southern Pacific
Author: Peter D.
Date: 03-17-2023 - 07:35
With enthusiasm like that, SP should still be here. Sigh. Marketing.....
The truly "free market" and increased modal competition envisioned under the Staggers Act was actually working well for railroads, employees, and consumers. Then for some strange reason, "we the people" through our elected representatives decided ditch free market competitive capitalism for monopolistic oligopolies. And, we let the major railroads divide the country into two major bi-coastal oligopolies (complete monopolies in many rail markets), that don't have to compete for more customers to raise their profits, they simply have to raise prices on those shipper they have control over, in their captive monopoly.
Marketing does matter in a truly competitive "free" market case like that. Monopolies don't need to market themselves in this way. You pay or else is the marketing strategy, instead.
I remember someone who worked for SP before the merger who told me about how they had been involved in looking at potential freight traffic on the Coast line during this period before the UP merger. The team he was workig with had identified the potential of as many as four hundred carloads a day of traffic, then on trucks, which could be competitively moved by rail, with proper service and marketing. The entire effort was terminated immediately upon the UP merger, and the sad state of freight on the Coast and the decline in rail traffic (and other related sea traffic)from Port Hueneme, are the sad legacy we see today.
Failure to require UP to divest their parallel and "stranded" monopoly lines and/or agree to open access by other carriers and/or independent small rail operators in the SP merger has been an economic policy failure for both shippers and consumers.