Has IP gone "Belly up"?

Discussion about Iowa Pacific Holdings and their various railroad operations. For passenger trains see also regional or tourist forums below. IP no longer operates the Hoosier State, see this topic in Amtrak: http://railroad.net/forums/viewtopic.php?f=46&t=104574
Official site: http://www.iowapacific.com

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Safetee
Posts: 361
Joined: Sat Oct 16, 2010 8:07 am

Re: Has IP gone "Belly up"?

Post by Safetee »

Ed Ellis didnt get into the railroad business to make money on freight. He is an unabashed disciple of the theory that second hand passenger cars and locomotives nicely refurbished and manned by Pullman crew look a likes serving great food etc etc can make money. and in the mean time, any other kind of business including freight, car storage etc etc that he can find on line that will allow him to beg, borrow, or steal from to subsidize the passenger trains is a ok.

BR&P
Posts: 4203
Joined: Fri Mar 12, 2004 7:58 pm

Re: Has IP gone "Belly up"?

Post by BR&P »

Safetee wrote:Ed Ellis didnt get into the railroad business to make money on freight. He is an unabashed disciple of the theory that second hand passenger cars and locomotives nicely refurbished and manned by Pullman crew look a likes serving great food etc etc can make money.
And how is that working out for him? :P

Safetee
Posts: 361
Joined: Sat Oct 16, 2010 8:07 am

Re: Has IP gone "Belly up"?

Post by Safetee »

No question that IP has taken some torpedoes with some of it's endeavors. But, they can't be accused of not trying.

ShortlinesUSA
Posts: 162
Joined: Sat Jan 20, 2007 6:57 pm
Location: Chattanooga, TN

Re: Has IP gone "Belly up"?

Post by ShortlinesUSA »

Safetee wrote:No question that IP has taken some torpedoes with some of it's endeavors. But, they can't be accused of not trying.
Agreed, but I think a better sense of knowing "when to say when" may have helped. It would certainly be nice if we were saying "Ed gave it his best" without the long line of unpaid creditors and employees to show for it (or better yet, how he found success).

Personally, I think the operation to watch is Brightline in Florida. I have worked in the transportation industry for over 25 years now, and I was told early on that "there is no money in moving people." And in my years, that invariably seems to be the case in all but a few niche operations. Even the largest transit agencies need substantial subsidies even if every seat on every train is filled every rush hour.

What Iowa Pacific has tried is generally a hobbyist/leisure-oriented business model. Brightline is a private operation setting up shop in a densely-populated region providing a necessary/desired/viable transportation option. That's a very fancy way of saying "If this doesn't work, nothing will" as far as private companies seeking to provide for-profit (or at least break even) passenger rail transportation. So, it will be interesting to watch that one. That said, while I don't know the specifics on how the company is set up, I have no idea how much (if any) of the Florida East Coast Railway's freight revenues will "prop up" Brightline. But at a minimum, they are providing a very nice right-of-way through some of the most densely-populated communities in Florida, so this is by no means some company with the wild idea to provide privately-funded passenger rail service across Raton Pass in New Mexico... ;-p

And that's not to say what Iowa Pacific was attempting to do with many of the marginal shortlines they acquired can't work. But the problem I see is the business model was reversed, or the cart was before the horse. You need a thriving freight operation to grow a budding passenger operation; not the other way around. The Tennessee Valley Railroad Museum here in Chattanooga is a good example, although I will admit the freight did not come first. They have had some handsome grants from NS over the years, too. But at present, they have established a substantial (and still growing) freight business in the Enterprise South business park, which includes switching the Volkswagen assembly plant. As a non-profit, there is not some side organization pocketing the loot-- it all gets invested in preservation and restoration at the museum, which also provides some nice excursions. That's a win-win, as I see it, especially now that the days of mainline steam look to be a distant memory on present-day NS.
Mike Derrick

Sid Farkus
Posts: 461
Joined: Tue Jun 26, 2007 10:23 pm

Re: Has IP gone "Belly up"?

Post by Sid Farkus »

It’s too bad what has happened to this company as I do admire their appreciation for golden age railroading. They had a real nice personalized touch on The Hoosier State and it seemed to gain appreciation from the riders. Too bad it just never worked out.
"If pizzas were manhole covers, the sewer would be a paradise." -Ed Norton

Backshophoss
Posts: 6637
Joined: Mon Mar 05, 2012 7:58 pm

Re: Has IP gone "Belly up"?

Post by Backshophoss »

AS NOTED in the Mt Hood thread,SLRG and Mt Hood are NOW in receivership,one of the Lenders (Big Shoulders),pushed this thru
Federal District Court.
This might be the end of IP and Ellis?? :wink:
The Land of Enchantment is not Flyover country!

eolesen
Posts: 678
Joined: Sat Apr 17, 2010 12:01 am

Re: Has IP gone "Belly up"?

Post by eolesen »

Maybe, maybe not.

Bankruptcy would give Ellis a chance to restructure, dump some of the poorer performing subsidiaries, and maybe present the opportunity to have the agreement with UP thrown out that prevents interchanging with BNSF at Walsenburg. RIght now, UP is the only interchange allowed, and that's been a stranglehold on SLRG's abilities.

dgvrengineer
Posts: 214
Joined: Tue Mar 08, 2011 10:22 am

Re: Has IP gone "Belly up"?

Post by dgvrengineer »

Looks like IP is selling numerous items including: 3 F7's, 2 F9's, 2 E8's, 2 BL2's, 3 steam engines, a GP38, 2 GP9's, several former Santa Fe and GN full length domes, several former LI bi-level cars & numerous other passenger cars. Items are listed on Ozark Mountain Rail. They can be viewed at:
www.ozarkmountainrailcar.com

eolesen
Posts: 678
Joined: Sat Apr 17, 2010 12:01 am

Re: Has IP gone "Belly up"?

Post by eolesen »

I don't think it's IP selling those. It's the debt holders, and at those prices, they should not be surprised at the lack of interest.

Safetee
Posts: 361
Joined: Sat Oct 16, 2010 8:07 am

Re: Has IP gone "Belly up"?

Post by Safetee »

I have heard that IP may be in the process of wrapping up all of its' non Cape Cod rail properties into bankruptcy proceedings.

Safetee
Posts: 361
Joined: Sat Oct 16, 2010 8:07 am

Re: Has IP gone "Belly up"?

Post by Safetee »

well it may not mean the end of iowa pacific, it certainly could be a sign of continuing problems; the iowa pacific web page appears to have been shut down.

Backshophoss
Posts: 6637
Joined: Mon Mar 05, 2012 7:58 pm

Re: Has IP gone "Belly up"?

Post by Backshophoss »

Was Mass Coastal able to break away from IP "mothership"?
The Land of Enchantment is not Flyover country!

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