Jon Wrote:
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> It would be interesting to see Genesse and Wyoming
> take control of CORP from Rail America, to create
> more of a regional railroad.

Why? GWI already had the opportunity to take over the Coos Bay Branch as contract operator (I believe they even bid for it) and lost. I'm sure if GWI wanted it could have taken over AERC when it was for sale, and it didn't.

If you look at the P&W/W&P lines to the north it's clear the future is NOT in the ex-Southern Pacific lines (with the Toledo Branch being the exception). The timber products industry is extremely battered. P&W has lost quite a few customers on the ex-SP/W&P side - the entire Dallas Branch is embargoed; Rex Hill is embargoed; they gave up on the Lower Westside; the Boise facility in Independence as well as Willamina haven't shipped anything by rail in years (and the Independence facility is shut down, as is the Salem facility that did ship by rail until its demise.) Cascade Steel in McMinnville is doing well but a lot of their traffic is now trucked (including the scrap feedstock from Schnitzer's scrapyard in Portland that once came in by rail using dedicated service gondolas); SP Newsprint in Newberg is very hit and miss. Most of their traffic seems to be scrap railroad ties to feed their power plant which instead of feeding the paper mill is sold to the local utility (PGE). That leaves just a handful of customers, very few "good" customers and a fair number of small one-or-two-off-carload or seasonal or intermittent customers. And Hampton Lumber in Willamina knows how to work the system - it trucks a lot of its timber from Willamina to reloads in Salem (Cascade Warehouse) and Portland (Hampton Distribution) to get better rates. That's no secret. And I don't believe Georgia-Pacific ships anything from Toledo or Wauna to its three or four Portland distribution centers by rail.

However the OE which for many years had been the sleepy branch is doing much better because it's has a much more diversified traffic base - some timber, yes. But more agriculture (and more of the larger shippers rather than the small, seasonal grain elevators that dot the Westside and Willamina lines), and quite a few industrial shippers.

It wouldn't surprise me if when the SP lease expires that W&P dumps the Westside/Dallas/Willamina Branches (Maybe David Root will get his revenge, since he apparently wanted the Willamina Branch when GWI got it) and keeps just the Toledo Line (which nicely ties into the OE) (which would then allow GWI to retire W&P since GWI would probably end up buying the Toledo Branch at that time and "merging" it into the P&W.) P&W has gotten big enough that I doubt they are making much money on the Westside.

And because of that...why would GWI want more of the same with the CORP? There's very little synergy - just a LOT more maintenance intensive track with not too much traffic. Before the Coos Bay Line shut down, P&W was handling twice the traffic CORP did with about the same route-miles.