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Western Railroad Discussion > Letting off steam....cash cowsDate: 11/23/22 11:18 Letting off steam....cash cows Author: jbwest As best as I can figure Wall Street has decided that railroads are cash cows, that railroads can no longer grow the business so it is time to milk it. Now the name of the game is to maximize cash flow and pay high dividends. This seems to match what is going on operationally: minimize costs by running huge trains. Forget about attracting carload and high value traffic by offering reliable service. The trains seem to be bigger than is optimum for the technology or the fixed plant, so delays are routine, whether it is because of pull-a-parts or sidings that are too short. Extra boards are expensive, so layoffs have to be limited making T&E jobs less attractive, and creating a labor shortage that adds to the unreliability. But who cares when you are now catering only to the bulk and trainload traffic that can’t readily move by truck. Service is no longer really important.
This kind of reminds me of where the railroads were when I hired out in 1959. Then there was a wonderful renaissance after deregulation. But that has run its course and now we are back to square one. What is unclear is whether this reflects the reality of market conditions, or whether it reflects a financial and management culture that lacks the creativity to see the opportunities. I'm just letting off steam....after all the successes of the past 40 years it is frustrating to watch the industry go downhill. JBWX Edited 4 time(s). Last edit at 11/23/22 11:27 by jbwest.  Date: 11/23/22 12:32 Re: Letting off steam....cash cows Author: pdt I dont think its just the RR industry. Greed and self absorbtion seems to be the in thing in ts country right now, moreso than usual, Shades of the 1890's. Lots of boomers in their 60's and 70's now...realizing that they are not going to live forever...and want to live like the Rockefellers before they die. IMHO
Date: 11/23/22 13:38 Re: Letting off steam....cash cows Author: czuleget That's OK with me where can I find fellow Rockefellers.
Date: 11/25/22 14:22 Re: Letting off steam....cash cows Author: MojaveBill I always ran my business to make money because not doing so would run my wife and I and our employees out of business...
Bill Deaver Tehachapi, CA Date: 11/25/22 14:42 Re: Letting off steam....cash cows Author: TAW MojaveBill Wrote:
------------------------------------------------------- > I always ran my business to make money because not > doing so would run my wife and I and our employees > out of business... Well, yeah, but you were probably not a monopoly of an essential service. price gouging to maximize profit. There's make money and there's make money. TAW Date: 11/25/22 16:56 Re: Letting off steam....cash cows Author: jbwest Let's not be foolish, railroads have always been in the business of making money. What I find sad is the investors (Wall Street) no longer think railroads can grow. So rather than investing in better service, management is forced to reduce costs and pay higher dividends. As a fan It is just less fun to watch, as a retired railroader it is disappointing.
JBWX Edited 2 time(s). Last edit at 11/25/22 17:46 by jbwest. |