Andyt293...
Re- the Charmin plant in Mehoopany....
Trust me – the story related to you about the traffic being too profitable is inaccurate. I did a case study on this traffic as a college student majoring in Transportation and Logistics in the mid 1980’s
Factor #1 : When Mehoopany was on LV's main line pre-1976, the LV was hauling 150 empty boxcars a day past the factory while returning empties back to their western connections at Buffalo. Considering that the LV, which terminated 75% of their boxcar traffic, was responsible for per-diem on empties all the way back to the home road, the car-hire savings more that offset the minor additional cost to stop and drop the empties. Also - all the LV had to do was herd the cars into three connection blocks at the plant and drag 'em down the pike to Buffalo to the interchange.
When CR stopped running through trains via the LV, the railroad now had to round up the empties, drag them a hundred miles out of the way to Scranton, then negotiate what was essentially a 100-mile, high-maintenance, one-customer spur line. They also had to ferry two or three switch crews a day back and forth from Scranton. They then had to drag the loads back to Allentown, switch them, and THEN move them to connections. The increase in handling cost was substantial. Toilet paper was about as low-rated a commodity as you could find, and Conrail very quickly realized they were losing their butts on the (regulated) traffic.
2. Charmin opened or purchased a Wisconsin paper mill in the late 1970's which began supplying customers as far east as Ohio. At that time, the output at Mehoopany was redirected to supply eastern and southern markets. Conrail's pre-Staggers Act break-even line-haul distance for this rate level was around 350 miles, which puts you outside of CR territory to the south, outside Charmin’s distribution zone to the west, or in eastern New England. The latter meant you still had an empty boxcar on your hands, another ten days accumulated car-hire expense, AND an additional 350 miles to move the blasted car. Remember - CR could NOT refuse to handle the freight.
3. CR's immediate reaction was to negotiate a surcharge with Charmin to at least cover the costs - I --think-- it was about $125.00 per carload. This stopped the immediate bleeding - just in time for Congress to deregulate the trucking industry. Suddenly, the 3300 empty private trucks that departed the Northeast every day for points west and south could haul toilet paper for whatever they felt allowed them to break even. I know the trucking company I worked for in the late 1980’s was hauling truckloads of Elmer’s glue from near Binghamton NY to points in Ohio for fifty cents a mile – and delivered door-to-door in less than 24 hours for close to the cost of the surcharge alone. You can predict the outcome from there.
Cash flow is not always the same thing as profit!
. 
