Western Railroad Discussion > UP, BNSF, CPKC - how big is too big?

Each time somebody proposes a merger, the rationale is it will provide better service. Seamless interchange. Better speed. But that never seems to happen.  Less responsive service, slower interchange over what should be run-thru service, etc. Railroad sales reps aren't available, or are 1,000 miles away. In some cases it may take a quarter million starving chickens on the front page of the Wall Street Journal  for a carrier to find a crew and move a grain train 25 miles to the ranch.

So, how big can you get before that personal touch, awareness of the shippers' needs, etc is lost? Clearly companies like Reading & Northern have that personal touch. So does Florida East Coast.  Maybe the smaller Aberdeen Carolina & Western.  Maybe Genessee & Western's decentralized model of "local" companies following the same playbook is another way. 

Any other examples of well run, high touch mid-size customer service railroads?

allready to big. 

People have been saying the railroads are too big since about 1900 or so.

Why don't you whine about Exxon / Mobil, Alphabet, Apple, United Health Group, Walmart, CVS Health, Amazon or the other Top 10 companies in America? Union Pacific's Market Cap is $167.6 Billion. Berkshire Hathaway, the company that OWNS BNSF has a market cap of over $500 Billion to $1TRILLION. That's uh, anywhere from 3 to 6 times larger and the Tech Giants like NVidia are worth 15 to 25 TIMES what UP is worth. I think the railroads have got a little ways to go before becoming "BIG". 

I think we found a UPRR Foamer.

Regards

Posted from iPhone

Amazon provides pretty close to perfect service for me. I doubt too many customers of BNSF etc would say the same thing about "their" rail service.

Posted from Android

Lackawanna484 Wrote:
-------------------------------------------------------
> Amazon provides pretty close to perfect service
> for me. I doubt too many customers of BNSF etc
> would say the same thing about "their" rail
> service.
>
> Posted from Android

If you knew somebody who works on the floor of one of their fulfillment centers you probably would not have such a rosy opinion of them. They treat their employees like crap.

Frankly Amazon has become a joke!  Next day shipping is pretty much gone for Prime members and doesn't happen.  The fulfillment centers are a joke - ask any employee - and the company is too big already.  The same for Union Pacific.  We saw what happened with its absorption of Cotten. Belt, MOPAC and worst of all Southern Pacific/Rio Grande.  Poor service, poor morale, cheap labor & coroprate glut.  Ask any shipper who has to use them...old and new!  Too big already...i hope they suffer big losses.  PHall Wrote:
-------------------------------------------------------
> Lackawanna484 Wrote:
> --------------------------------------------------
> -----
> > Amazon provides pretty close to perfect service
> > for me. I doubt too many customers of BNSF etc
> > would say the same thing about "their" rail
> > service.
> >
> > Posted from Android
>
> If you knew somebody who works on the floor of one
> of their fulfillment centers you probably would
> not have such a rosy opinion of them. They treat
> their employees like crap.



Edited 2 time(s). Last edit at 07/05/26 06:21 by bnsf6606.

Read the Trains Magazine article about the Frisco from 1979/1980 just immediately prior to the BN merger. You can find it in the Trains archives. Now that was customer service!!

Drknow Wrote:
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> I think we found a UPRR Foamer.

Just a stock market foamer, obsessed with market capitalization ("market cap"), which is merely number of shares x stock price. Prices are manipulated all the time, and number of shares fluctuate artificially (stock buybacks, executives dumping shares), so $167.6 billion is a meaningless number on how "big" a railroad is.

As I've said many times, Wall St. idiots (and many railroad "executives") don't understand the business. They only care about moving stock prices.

Here's a funny UPRR example:

In 2014, UNP was worth about $105 billion dollars*. In 2024, about $132 billion. Did UNP get 26% "bigger" in 10 years? NOPE. Inflation was 32.5% between 2014 and 2024, so UNP actually got SMALLER! (mocking laugh). So people shouldn't take market cap too seriously.

I'd say a railroad is too big when the executive management does stupid things, mainly due to incompetence. The Foster Farms chicken feed misdelivery example above, the obsession with ratios, 700 mile detour to eliminate a train symbol, changing crews across subdivisions just to make crew start numbers look good, and so on. So maybe "too stupid" instead of "too big" is the correct phrase?

We had "flat lander MoPac" management from the 1982 merger that mismanaged the WP/SP mergers later, due to their incompetence of mountain railroading. I say UP was "too stupid' then.

When Jim Young tried to clean that up in his era, I don't remember people complaining that UNP was too big, especially when he put a stop to that petty trademark lawsuit against Lionel and Athearn, and his team was going after real business (ZDLSK/ZSKDL, ZG2OA, QFRNPP, etc), and train velocity was reasonable then.

*In 2014, UNP's market cap fluctuated about 50% within the year. So to mimic the manipulation that Wall St. does to play the idiots, I picked the numbers in 2014 and 2024 to "win" my argument. >:-)



Edited 1 time(s). Last edit at 07/05/26 23:47 by cchan006.

A company is only "too big" when it can't provide good service.  UPS is nation wide....but they provide great service.

The big railroads could be the same way---but "service" is not at the top of their list.  Service in as "let me see what I can do to help you!"

cchan006 Wrote:
-------------------------------------------------------
> Drknow Wrote:
> --------------------------------------------------
> -----
> > I think we found a UPRR Foamer.
>
> Just a stock market foamer, obsessed with market
> capitalization ("market cap"), which is merely
> number of shares x stock price. Prices are
> manipulated all the time, and number of shares
> fluctuate artificially (stock buybacks, executives
> dumping shares), so $167.6 billion is a
> meaningless number on how "big" a railroad is.
>
> As I've said many times, Wall St. idiots (and many
> railroad "executives") don't understand the
> business. They only care about moving stock
> prices.
>
> Here's a funny UPRR example:
>
> In 2014, UNP was worth about $105 billion
> dollars*. In 2024, about $132 billion. Did UNP get
> 26% "bigger" in 10 years? NOPE. Inflation was
> 32.5% between 2014 and 2024, so UNP actually got
> SMALLER! (mocking laugh). So people shouldn't take
> market cap too seriously.
>
> I'd say a railroad is too big when the executive
> management does stupid things, mainly due to
> incompetence. The Foster Farms chicken feed
> misdelivery example above, the obsession with
> ratios, 700 mile detour to eliminate a train
> symbol, changing crews across subdivisions just to
> make crew start numbers look good, and so on. So
> maybe "too stupid" instead of "too big" is the
> correct phrase?
>
> We had "flat lander MoPac" management from the
> 1982 merger that mismanaged the WP/SP mergers
> later, due to their incompetence of mountain
> railroading. I say UP was "too stupid' then.
>
> When Jim Young tried to clean that up in his era,
> I don't remember people complaining that UNP was
> too big, especially when he put a stop to that
> petty trademark lawsuit against Lionel and
> Athearn, and his team was going after real
> business (ZDLSK/ZSKDL, ZG2OA, QFRNPP, etc), and
> train velocity was reasonable then.
>
> *In 2014, UNP's market cap fluctuated about 50%
> within the year. So to mimic the manipulation that
> Wall St. does to play the idiots, I picked the
> numbers in 2014 and 2024 to "win" my argument.
> >:-)

Yes. I always get a kick out of people who complain about companies being too big, then turn around and buy the stock when their stockbroker yells "BUY!!".

People have choices. Some individuals won't buy stock, of a specific company, based on a principal (they fired my dad, they layed my neighbor off, the company sucks, ect). Whatever. Just don't complain to the masses about the "woulda, coulda, shouldas" when the stock price suddenly moves past "it's ceiling".

Keith_Kevet

Posted from Android

coach Wrote:
-------------------------------------------------------
> A company is only "too big" when it can't provide
> good service.  UPS is nation wide....but they
> provide great service.
>
> The big railroads could be the same way---but
> "service" is not at the top of their list.
>  Service in as "let me see what I can do to help
> you!"

UPS has an extremely tight connection with its clients. Its union drivers and non union sales managers know exactly what is happening.

No way a million starving chickens, dozens of calls to Union Pacific, etc would happen. And be ignored.

Posted from Android

That "starving chickens" thing on UP cast its CEO his job but, he left with a large payout to him.  That never made sense to me.

You bet I'm a  "UPRR Foamer" but a money grubber, too. It beats being a "Oh don't take my favorite choo choo away" weirdo. NO Money in that. ANY company that sends me a check in my retirement is a company I'm gonna support. I truly wonder how many of you have an MBA from somone better that the "University of Phoenix" and could REALLY run a railroad better than the people that are doing it? I see aLOT of people complain about how its being done but NO REAL ANSWERS on how you would ACTUALLY CHANGE IT. How would you ACTUALLY provide better service, deal with the unions, the unhappy customers, the bad performers in your company, the investors and the governent? I read a LOT OF BITCHING BUT NO REAL ANSWERS. If you DO come up with a plan, try submitting it to the FRA. I'm SURE the railroads would LOVE to see what you've come up with. WE ALL would. All most of you do is sit in an arm chair and dream of "the good ol' days" when your favorite railroad was still around. Well, MINE STILL IS and getting bigger and better ALL THE TIME. 

eastlandt Wrote:
-------------------------------------------------------
> That "starving chickens" thing on UP cast its CEO
> his job but, he left with a large payout to him. 
> That never made sense to me.

Most senior officers in any industry have seven and eight figure retirement benefit plans. Few people are actually fired "for cause". Usually you agree to part and they pay you a bundle for the rest of your life.

Life is very different for the very rich and well connected. Working folks don't get that deal.

Posted from Android

eastlandt Wrote:
-------------------------------------------------------
> That "starving chickens" thing on UP cast its CEO
> his job but, he left with a large payout to him. 
> That never made sense to me.

If you're talking about Lance Fritz......there's a guy who should never have been CEO.

UP's grain marketing management team was a mess then. Much different now.

Keith_Kevet

Posted from Android

gandydancer4 Wrote:
-------------------------------------------------------
> You bet I'm a  "UPRR Foamer" but a money grubber,
> too. It beats being a "Oh don't take my favorite
> choo choo away" weirdo. NO Money in that. ANY
> company that sends me a check in my retirement is
> a company I'm gonna support. I truly wonder how
> many of you have an MBA from somone better that
> the "University of Phoenix" and could REALLY run a
> railroad better than the people that are doing it?
> I see aLOT of people complain about how its being
> done but NO REAL ANSWERS on how you would ACTUALLY
> CHANGE IT. How would you ACTUALLY provide better
> service, deal with the unions, the unhappy
> customers, the bad performers in your company, the
> investors and the governent? I read a LOT OF
> BITCHING BUT NO REAL ANSWERS. If you DO come up
> with a plan, try submitting it to the FRA. I'm
> SURE the railroads would LOVE to see what you've
> come up with. WE ALL would. All most of you do is
> sit in an arm chair and dream of "the good ol'
> days" when your favorite railroad was still
> around. Well, MINE STILL IS and getting bigger and
> better ALL THE TIME. 
   Oh, I'll bet if you think about it, in all the time you've been workin' out here, you can think of 
a few times people have made suggestions to make things better. Haven't you? 

eastlandt Wrote:
-------------------------------------------------------
> That "starving chickens" thing on UP cast its CEO
> his job but, he left with a large payout to him. 
> That never made sense to me.

Lance Fritz's departure was much more complicated than that.

Vena (as COO and Exec VP of UP) should own the starving chickens incident, even if the timing of the events don't seem to fit that claim. Some of Young/Koraleski era senior managers retired/resigned in protest of Vena's first hiring (2019), so their successors (under Vena's supervision) let the chickens starve. BNSF playing PSR games with coal trains to Washington happened around the same time (4-5 years ago) so you should be wondering if "CEOs" actually run the railroads, or if they are following orders from "shareholders (puppeteers)."

How Vena got booted as Exec VP then "return" as UP CEO should make you wonder, too. We'll never know how much Fritz and Vena disagreed on things in 2020. Ex-COO vs. COO.

And the puppeteers might reward exeutives who follow orders and help move the stock prices instead of running the business properly. That might explain other large payouts to Omaha C-suite members that might not make sense to you either:

https://www.trainorders.com/discussion/read.php?1,6009145,6009650#6009650

More food for thought:

https://www.trainorders.com/discussion/read.php?1,5786916,5787265#5787265

If what I say is even more confusing, that's OK - most people draw a blank to my comments anyway.

I've been watching Wall St. shenanigans for more than 25 years, and learned to dismiss or ignore mainstream financial media narratives (which OP likes to post links to) which are half-truths at best. Once I started ignoring, I started doing better with stocks, which supports my lifestyle today. That might be meaningless to TO members, but that explains why I bother to comment on these things.

cchan006 Wrote:

> Lance Fritz's departure was much more complicated
> than that.
>
> Vena (as COO and Exec VP of UP) should own the
> starving chickens incident, even if the timing of
> the events don't seem to fit that claim. Some of
> Young/Koraleski era senior managers
> retired/resigned in protest of Vena's first hiring
> (2019), so their successors (under Vena's
> supervision) let the chickens starve. BNSF playing
> PSR games with coal trains to Washington happened
> around the same time (4-5 years ago) so you should
> be wondering if "CEOs" actually run the railroads,
> or if they are following orders from "shareholders
> (puppeteers)."
>
> How Vena got booted as Exec VP then "return" as UP
> CEO should make you wonder, too. We'll never know
> how much Fritz and Vena disagreed on things in
> 2020. Ex-COO vs. COO.
>
> And the puppeteers might reward exeutives who
> follow orders and help move the stock prices
> instead of running the business properly. That
> might explain other large payouts to Omaha C-suite
> members that might not make sense to you either:
>
> https://www.trainorders.com/discussion/read.php?1,
> 6009145,6009650#6009650
>
> More food for thought:
>
> https://www.trainorders.com/discussion/read.php?1,
> 5786916,5787265#5787265
>
> If what I say is even more confusing, that's OK -
> most people draw a blank to my comments anyway.
>
> I've been watching Wall St. shenanigans for more
> than 25 years, and learned to dismiss or ignore
> mainstream financial media narratives (which OP
> likes to post links to) which are half-truths at
> best. Once I started ignoring, I started doing
> better with stocks, which supports my lifestyle
> today. That might be meaningless to TO members,
> but that explains why I bother to comment on these
> things.

Don't forget about the other cast of characters on the BOD when Fritz was CEO. They threw him under the bus. They wanted the shiny new toy (PSR) asap. He didn't want the asap part.

I've always viewed the entire BOD
selection process, for railroads, with pause. Proxy or otherwise. In the old days it was common to have the CEO's good pals on the board, usually bankers and CEO's of major shippers. Now days I don't pay enough attention to crap like that, but I should. I mean who on any railroads BOD knows anything about railroad operations other than the railroads CEO? Probably next to nobody.

Keith_Kevet

Posted from Android