Should Pan Am be concerned about traffic loss due to CP acquiring CMQ?

[bostontrainguy]

How about . . . why?

[newpylong]

I have no clue to their long term strategic thinking, but off the top of my head - not having to pay PAS to move their CP traffic out the west end since most of it ends up in Maine anyway?

[bostontrainguy]

So then why would PAS be excited about the CP purchase? I don't get it. They will just bypass PAS, no?

[newpylong]

Who said anything about PAS? Bostwick is the PAR EVP.

[bostontrainguy]

My mistake. I meant PAR.

So why would PAR be excited about this move?

[CN9634]

The NS - PAR relationship is pretty sour these days, PAS doesn't really fit into the whole NS/PSR thing, because of the lack of operational control by NS. From there perspective is no plan to invest any further in anything beyond Mechanicville and rather just let traffic flow off Pan Am, so really no reason to work closely with them.

Pan Am may feel from their side that there is no real 'partnership' in the deal, but in reality the creation of an entirely different railroad structurally was really up to one person who agreed to sell a quarter equity of the property to NS. Actually, in this day and age, PAS feels quite bizarre in the current structure. So perhaps for PAR the excitement is as has been mentioned, another true Class I connection avoiding PAS/NS side of the equation.

Would be interesting to see a shift in traffic eastward on the Pan Am system, not sure it would do much in way of moving jobs around but interesting nonetheless. I hear too there is a belief that CP will honor the haulage deal, but I'd keep watch to see if an off chance that Pan Am looks to establish a trackage deal proper to reach NBSR at Brownville Jct. I think that is less than likely to happen, but you never can tell perhaps they are excited to work with CP on some kind of operations deal as well (easily they could sub the Rockland branch too).

[pnolette]

Wouldn't PAR be shorthauling themselves if they turned over traffic at NMJ?

[KSmitty]

Carriers charge based on mileage, but also on car origination/termination fees, car hire fees, etc. If you load it in a Pan Am car the railroad gets a cut. They are the originating carrier they get a cut. Then they have their rate for the mileage. So yeah, hauling a few miles might reduce your rate, but you still get all the costs associated with the car itself, and with the fees associated with switching. So you give up a bit of money on the rate and save all your down the line costs, like switching in Rigby, crew time, fuel, etc...

The money is always better if you control the load. It's why trains from NBSR used to sit while trains from Bucksport got hotshot priority. Money was better on the smaller train out of Bucksport than the bigger train from offline. There is a reason successful railroads rarely operate strictly as a bridge line.

[pnolette]

Thanks.Could mean less traffic going down my way west of Rigby

[newpylong]

Hopefully it's incremental growth, but yes, it could be less traffic destined for the Mohawk CP interchange.

[johnpbarlow]

As of 2/3/20, Pan Am Railways and Washington County Railroad (owned by Vermont Rail System) have both filed "Notice Of Intent To Participate (Without Comment)" in the CP acquisition of CMQ proceedings at the STB. In addition to copying Elaine Chao (US Secretary of Transportation) and William Barr (US Attorney General), both Pan Am and WACR have copied the following provocative list of industry people/entities about the 2 RRs' intent to participate:

James A. Therriault VP of Materials Handling for Sprague Resources GP LLCs at 185 International Drive Portsmouth, NH 03801
Bruce A. Van Note Commissioner of Maine DoT at 16 State House Station Augusta, ME 04333-0016
Jerome Pelletier VP of Saw Mills Division for Irving at 300 Union Street Saint John, NB
Tim Baade Senior VP and GM Irving Consumer Products at 102 Dawson Ave Dieppe, NB
Mark Mosher VP Pulp & Paper for Irving at 300 Union Street Saint John, NB
David Saucy VP - Construction & Equipment Division for Irving at 30 Jervis Lane Saint John, NB
Ron Clow General Manager at Cavendish Farms at 100 Midland Drive Dieppe, NB

Robert Culliford Legal Counsel for Pan Am and submitter of Pan Am's filing also copied Peter F Young Counsel for VRS and submitter of VRS' filing.

Given most of the entities above are not served directly by either VRS or Pan Am, why would the 2 RRs think it was important to let them know of their intent to participate without comment at the CP-CMQ acquisition proceedings?
https://dcms-external.s3.amazonaws.com/ ... 300327.pdf
https://dcms-external.s3.amazonaws.com/ ... 300340.pdf

[CPF363]

It does not appear from any formal documentation that either Pan Am or the VTR is looking for any concessions as part of the merger yet.

[PBMcGinnis]

The public relations strategy for Pan Am in regards to the CP is quite simple:

"Keep your friends close, and your enemies closer." - Michael Corleone

[jaymac]

PAR has tended to punch down -- Milford-Bennington and New England Southern -- and not up. NS might also be unhappy if if the PAR part of PAS got negative with an NS ally.

[PBMcGinnis]

Pan Am today applied to the STB a request for trackage rights to run their own trains up to Brownville Junction.

So....

Tah Dah