Inside This Issue
· Trucks or Tracks? RRs Boldly Adding New Services to Shift Share
· Freight Fight in Phoenix: UP’s Desert Storm Attack on Major L.A. Truck Route
· Tex Flex: Port of Houston Booming with New Intermodal Lanes
· Continental Commerce: An Update on the U.S., Canadian, and Mexican Economies
· Kingdom Chem: A Detailed Update on the Chemical Sector, from the ACC
· Tracing Back: The Saga of Tracy Robinson’s Return to Railroading
· The Emission Mission: Oliver Wyman’s Adriene Bailey on RRs Cutting Carbon
Track Talk
“The Phoenix market is one of the fastest growing areas for manufacturing and warehousing in the southwest. I’m excited that we are making investments to support a new service product from the ports of Los Angeles to Phoenix, with the expectation to expand in the future.”
- Union Pacific marketing and sales chief Kenny Rocker
Publisher’s Note: A reminder that Railroad Weekly publishes 48 issues per year. The last issue of 2023 will be on Dec. 18th. There will be no issues on Dec 25th and Jan 1st.
Union Pacific Making Moves
· All Class I railroads now agree: The time has come to grow. Or at least try. Five or six years ago, the opposite sentiment prevailed, that railroads needed to shrink to lower their operating ratios. Fewer locomotives. Fewer people. Less infrastructure. And so on. Their downsizing efforts mostly did succeed in improving profit margins. Then came the pandemic, which triggered another round of layoffs. But this left railroads unable to handle a quicker-than-expected rebound in freight demand, especially in 2021 and much of 2022. Customers bristled. So did regulators, politicians, and unions. Though profit margins generally held at high levels, a new generation of Class I chief executives—Farmer, Shaw, Hinrichs, Robinson—concluded that the era of shrinking was over. Their railroads would seek to grow—cautiously and efficiently, for sure, within the principles of precision scheduled railroading—but grow nonetheless. Jim Vena too, an architect of Union Pacific’s downsizing in the pre-pandemic era, has become a growth disciple post-pandemic, now as UP’s top leader. And he’s showing it with a host of new offerings designed to win more business.
· Last week, UP unveiled its latest move: A new international intermodal terminal in the fast-growing Phoenix metro area. Container freight from abroad destined for the southwestern U.S. can now more easily get there by rail, via the ports of Los Angeles
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