Scott A. Hartley
JACKSONVILLE, Fla. – Pan Am Railways is now a fallen flag.
The New England regional officially became part of CSX Transportation on Wednesday, six weeks after the Surface Transportation Board approved the acquisition.
“We are excited to welcome Pan Am’s experienced railroaders into the CSX family and look forward to the improvements we will make together to this important rail network in New England, bringing benefits to all users of rail transportation in the Northeast region,” CEO Jim Foote said in a statement. “This acquisition demonstrates CSX’s growth strategy through efficient and reliable freight service and will provide sustainable and competitive transportation solutions to New England and beyond.”
CSX plans to spend more than $100 million over the next three years to improve Pan Am’s main lines and yards.
The deal adds Vermont, New Hampshire, Maine, and, via haulage rights, Saint John, New Brunswick, to the CSX network while expanding its reach in New York, Massachusetts, and Connecticut.
CSX also steps into Pan Am Railways’ shoes in the Pan Am Southern, the joint venture with Norfolk Southern that includes Pan Am trackage west of Ayer, Mass., including trackage rights routes along the Connecticut River in Vermont, New Hampshire, Massachusetts, and Connecticut.
No date has been set yet for Genesee & Wyoming’s Berkshire & Eastern to begin operating the Pan Am Southern, according to a G&W spokesman. As part of an agreement between CSX and NS, the Berkshire & Eastern will be the designated neutral operator of the Pan Am Southern. For now, Pan Am Southern continues to be operated by Pan Am Railways subsidiary Springfield Terminal. Berkshire & Eastern still must reach agreements with rail labor before it can take over as neutral operator.
NS also will shift its daily Chicago-Ayer intermodal trains to a faster and fully cleared route over new CSX trackage rights from the Albany, N.Y., area to Worcester, Mass., and then to Ayer via a combination of Providence & Worcester, Pan Am Railways, and Pan Am Southern trackage. The trains currently run via the Pan Am Southern route, the former Boston & Maine via Hoosac Tunnel.
But before NS can use its new trackage rights, it must first build a new connection track linking its Voorheesville Running Track with CSX’s Selkirk Subdivision at Voorheesville, N.Y., where the Delaware & Hudson and New York Central once crossed at grade. Several clearance projects also must be completed north of Worcester. The projects are not expected to be completed until the fourth quarter at the earliest.
Pan Am, a privately held company owned by Tim Mellon and other investors, went on the market in 2020. CSX’s bid beat two other suitors who were interested in acquiring the largest regional railroad in North America.
Including haulage rights, Pan Am stretches 1,700 miles from the Albany, N.Y., area to Maine. It includes the former Maine Central, Boston & Maine, Portland Terminal, and Springfield Terminal railroads. Pan Am connects with four Class I railroads — CSX, Norfolk Southern, Canadian National, and Canadian Pacific — and 14 short lines.
CSX connects with Pan Am at Rotterdam Junction, N.Y., on its former New York Central Water Level Route, and outside of Worcester, Mass., via its former Boston & Albany main line, which is far and away the busiest freight route in New England.
Pan Am entered the rail business in 1981 when the company, then known as Guilford Transportation Industries, purchased the Maine Central for $15 million. Two years later, Guilford purchased the bankrupt Boston & Maine for $24.5 million. Guilford acquired the Delaware & Hudson from Norfolk & Western for $500,000 in 1984, but cast it off into bankruptcy in 1988.
Guilford Rail System was rebranded as Pan Am in 2006. Despite the long-term decline of Maine’s paper and forest product industries, as well as manufacturing across New England, Pan Am and Guilford managed to turn a profit every year.
Terms of the CSX-Pan Am deal were not disclosed, although people familiar with the matter said the purchase price was approximately $700 million.
I’ll second the John Rice view. The potential is not New England and the Maritimes, it is THROUGH New England and the Maritimes to Europe.
Still trying to figure out why CSX bought into a declining (for rail) area?
CP and Irving are pretty dominant at St. John and there’s miles and miles of Class 1/2 track to fix up.
The PAS (ex-B&M) being run by G&W is on borrowed time without the NSC Ayer traffic. There is almost no online business and the Hoosac tunnel is the elephant in the room.
VRS rolled over and will find itself surrounded by G&W.
VRS should have gone for trackage rights to Rotterdam Jct., instead settled for 3 times/week at East Deerfield forcing trains to climb the Green Mountain spine on the GMRC.
No one is going to miss Pan Am – bad track, bad equipment and bad service.
The track at Voorheesville is two streaks of rust disappearing into the overgrowth. (The line east of there is now a Bolshevik rail-trail.) The locals may be a bit surprised to see doublestacks and autoracks going by…eventually.
The line is used up to the Guilderland Industrial Park, the rest of the way to Vorheesville is rusted 90lb jointed rail and used for storage.
The switch at Vorheesville with CSX is long gone but the connection track is still there sinking into oblivion.
pan am railways will always forever be remembered and will never be forgotten I hope the wreck train, f-units and business cars will find new homes
I am guessing 2 years, perhaps 3 years when the new traffic patterns get settled and the new connections put in that the abandonment’s and short line spin offs will begin.
CSX will start offering local shippers dumpster dive pricing on trucks to service them and then rip out the tracks and sidings. This will leave CSX with just a few mainlines to provide long distance coverage and leave the rest to the dogs for scrap.
I’ll wait and see, John. You are probably right. CSX is known for doing some pretty stupid things.
Jonh Rice and Chris Boza, my vote is on “stupid”.
As recently as the 1980’s, the Boston and Maine Corporation carried a fair amount of freight. That traffic is gone.
Sometimes the simplest explanation is the most valid. (Occum’s Razor or something like that). The simple answer is that CSX is out of its mind. The more complicated answer, thus perhaps the less likely, is that CSX is onto something we just don’t see,
Pan Am (or, to me, who last lived in New England 53 years ago, the Boston and Maine Corporation) has degenerated into a hopelessly miserable regional – the kind of line that the likes of CSX and NS get rid of, rather than acquire.
The former B+M Corporation is the sort of line that the majors dump onto a start-up regional that might make something out of it. Re-read TRAINS MAGAZINE December 2021, Lake State Railway consisting of ex- Detroit and Mackinac, ex-New York Central, and ex-Chesapeake and Ohio lines, all in lower Michigan.
If CSX couldn’t make it on a line to the industrial cities of Flint, Bay City, Saginaw and Midland, why would CSX turn around and acquire Pan Am? Beats me!
Why?
Port St John
Specifically the Irving industrial complex which includes:
– Refined oil products (to and from)
– Pre and post wood products, including wallboard, paper, cardboard, etc.
– Specialty chemicals
– LNG
– Rare Earths
While I don’t think it plays as large of a role, the port is about 12-14 hours closer by boat to the UK than PONY-NJ is.
The Bellows Falls tunnel was expanded several years ago and can even handle double stacks.
I am not sure about that Ray. I know they tried, but never heard that they were able to accommodate double stacks. It seems that I was at a “Railroad Days” show in Bellows Falls and talking to a NECR dispatcher from St. Albans, (Jim Murphy) about the project and I thought he told me they were not able to go deep enough. I am not sure about that though. The problem they had was/is the building that sits above the tunnel.
The BF tunnel handled auto rack cars during the detours of Pan Am freights due to the collapse of the Hoosac Tunnel a couple of years ago. I think double stacks and auto racks are similar in clearance needs, but I am not absolutely sure.
The ace in the hole for CSX is Port Saint John.
So, will we see some CSX loco’s in White River Junction.? Not sure the larger one’s would fit through the tunnel in Belows Falls.