The changes, announced in late January, are the latest as UP streamlines its intermodal network as it implements its Unified Plan 2020, the new operating plan based on the principles of Precision Scheduled Railroading.
UP will end joint service from 52 origins on its system and in Mexico and points on CN; from 50 origins to destinations on Canadian Pacific; and from 84 origins to terminals on CSX.
The originating terminals on UP include points on the West Coast, the Southwest, Denver, and Texas, plus locations in Mexico. Destinations in Canada include major cities such as Montreal, Toronto, Winnipeg, and Calgary. CSX destinations are spread across the system, including terminals in the Midwest, Northeast, and Southeast.
The service changes take effect on Feb. 26, UP said in its Jan. 24 announcements, and will likely affect intermodal volumes but not the number of intermodal trains interchanged with CN, CP, or CSX.
In theory, shippers from affected originating terminals could still use UP intermodal trains to interchange points in Chicago or, in the case of a handful of CSX destinations, the St. Louis gateway.
But customers would be responsible for dray moves between terminals and would have to arrange for intermodal service on the connecting railroads for moves to Canada or points on CSX.
Intermodal analysts have said that’s unlikely due to the costs involved and limited dray capacity in Chicago.
The changes announced this week are the latest wave of interline service curtailments and the first to affect service to Canada.
In December, UP and Norfolk Southern announced they would end interline service between 236 eastbound origin-destination pairs and 244 westbound pairs. Last year UP and CSX also dropped interline service in low- and no-volume lanes. And CSX and BNSF Railway dropped interline service between some terminals on their systems.
UP executives have said the railroad was serving too many low-volume lanes, whose traffic moved in small blocks that could not efficiently be handled via steel wheel interchange in Chicago and other gateways.
The slimmed-down interline service reduces operational complexity and rubber-tire crosstown moves, executives say, which has cut costs while making service more reliable.
The railroads will invest little to increase capacity. Where have you heard an eastern railroad proposing such? The railroad transfer service in still back in the 1800’s.
All of your comments here are germane. I would add however, that the railroads are mainly in business today to squeeze as much dividends out of the plant for the benefit of the stockholders. Intermodal customers are secondary and must tolerate the poor service or put their loads on the relatively free Interstate highway system. Too, the railroads are not particularly interested in capturing much additional traffic that would involve significant infrastructure expansion. Do do so would take away too much money used as dividends. I would say too that what the railroads have done to cut service locations is why the country needs truly transcontinental railroads under one flag. New domestic intermodal corridors would be more economically served. As is, everything gets dropped on the highway or in wasted time with steel wheel interchanges into already plugged railroad terminals. I see little to nothing in railroad thinking that improvements will alter the current situation and change the transportation paradigm. Unfortunately, the railroads are still learning how to run things under PSR. I would suggest these suits go back and look how the railroads ran merchandise freights on schedules 50 years ago.
Rubber-tire transfer at Chicago? Some junior genius at corporate can’t figure that one out? Oh well, 60 some odd years ago the remark was made that pigs could steel-wheel through Chicago, but passengers couldn’t. Any number of potential by-passes were torn up years ago, such as the Peoria gateway, IHB, C,M StP&P Indiana sub, TP&W, etc. Shear aptitude at work. A transport means that uses 1/50th of the man-hours as a truck can’t compete? Someone needs to be fired. If they can make COFC/TOFC in short, high-speed trains in the UK, France, Belgium, the Netherlands and Germany work satisfactorily, it can be done here. Maersk and others will soon demand it here. FEC and KCS/Panama are doing it and making money. If CSX thought implementing PSR was rough, wait until the big six are forced to re-think intermodal-and make money at it. It can be done if cooperation and commitment are made, as has been demonstrated. Is risk involved? Absolutely. The bigger risk, long term, is squatting on the plant, milking the cash cow as the economy develops and hoping nothing changes.
Intermodal is not high profit business, kinda like selling milk. You gotta sella huge amount to make an money but then are stuck with the unforgiving cost to deliver. Small volumn costs as much as big volumn to deliver.
Nothing like telling customers, “We don’t want your business!” to increase sales.
Truckers seem to be winning. When Walmart can offer $90k to recruit drivers, you know that rail is losing the battle.
And CSX taking intermodal via StL? What a laugh. They prefer Chicago because the Avon route ends up in Cleveland with the rest of the Chicago traffic.
Queensgate is tied up with north|south and they have the Illinois Sub cut at East St Louis and up for sale.
That leaves Memphis and New Orleans. The NO to Jax (Baldwin) route is for sale and traffic goes by way of Birmingham and Waycross. Memphis has little value because 2 or the 3 routes out of Nashville end up at congested terminals.
I would love to take that Illinois Sub off their hands ($73M?) and use it as a reliever route.
Railroads just willfully fading a little more into oblivion. This industry has no future.
There is a pattern here. The rails have a history of redrawing the line in the sand. They give up traffic to justify offering better service on remaing traffic. Its a vicious cycle.
Livestock, perishables, branch lines, piggyback and now this. Whats next? Truckers continue to take the candy from the baby. Instead of becoming harder it becomes easier. If we could al be so lucky to have today’s railroad management as out business competitors. We’d get rich with little effort!
Forget the low volume, this morning my scoot got held 32 minutes for the ZG3SKP, a perishable/stack train. When I came back through three hours later, the train was still in the same spot. When I went home this afternoon I went over the top of the train on I-57 by Barr Yard. 9hrs to get from the near west side of Chicago to the south side. Now that’s service.
CSX’s North Baltimore ICTF was the answer to low volume intermodal lanes.. Combine low volume, into large volume traffic.. Unfortunately a great idea that came to late.. Another sound casualty of PSR…
Remember when good business practice was to find ways to increase business?