KCS/CP Merger Discussion

Gilbert B Norman wrote: ↑Thu Jan 13, 2022 12:50 pm For the love of me, Mr. Shortline, I'm at a loss to understand why CN would want it.

I think CN's interest stems from a larger growth strategy that they have been pursuing quite openly in the past few years. The former Grand Trunk Western and the Sarnia, Ontario-Halifax, Nova Scotia line are massively underutilized compared to CN's other mainlines. CN has been attempting to grow traffic over these lines as evident by the attempted Massena Line purchase along with CN's acquisition of two trucking firms.

By connecting Kansas City with Detroit, Eastern Canada, and especially the ports of Halifax and Saint John, CN can run intermodal and automotive trains from the low-cost Canadian ports to the heart of the continent in competition with CP and soon CSX, thereby putting volume on rails that would otherwise not be there. Sure, Kansas City-Detroit automotive traffic in competition with NS is a big factor but is not the only one.

Of course, there are problems to be worked out. Both the Gateway Western and Illinois Central Gilman Sub would need to be massively upgraded and the bridge over the Mississippi River would have to be either upgraded or fully replaced. (I bet you a big chunk of that $250 million CN wants to commit would go towards that project alone.) The problems I don't think are insurmountable and CN in the past has been able to turn lines that were mediocre at best into something worth envying. (Just look at CN's line between Chicago and Western Canada.)

As for what BNSF and NS want, well... BNSF's requested Dallas-Shreveport rights seem to be an attempt to directly connect with NS for intermodal traffic, suggesting BNSF is interested in using the Meridan Speedway. The requested Robstown-Laredo rights the REALLY interesting and basically give away that Mr. Buffet is looking to swipe KCSM away in the near future! (Remember that KCSM has exclusivity over the concession until 2027, with the concession ending in 2047. "Exclusivity" means that until 2027 only KCSM can use those lines.) I have zero ideas what the Savanna-Clinton rights would be used for... With the recent announcement of the MRL acquisition, looks like BNSF is out on the offensive again.

NS is also interesting as direct access to Dallas/Fort Worth seems to be a play for so-called "watershed traffic," which is traffic that threads the arbitrary east-west railroad dividing line. (This traffic could be worth billions if it could be fully captured.) NS having basically unrestricted access to these lines would make CPKC's presence a lot less pronounced as a significant amount of traffic along these lines is destined for NS.

Now, will CP and KCS agree to these concessions? Almost certainly not without receiving something in return. Perhaps people's ideas of a joint CPKC-NS "Wabash Speedway" could finally come to fruition in this manner! I sure hope so.

JayBee wrote: ↑Thu Jan 13, 2022 8:09 pm Well Uncle Warren and Topper have made their requests for remediation if the CP/KCS merger happens

BNSF wants......trackage rights from Clinton, IA to Savanna, IL.

What's Warren up to? Does he wish to establish an interchange with the UP (C&NW) at Clinton - and for what purpose?

Some coming to my mind are to keep GN and NP traffic away from the UP (RI) at Twin Cities thereby grabbing a better chunk of the rate Division and also to avoid Chicago congestion on whatever traffic they presently interchange there.

At Savanna, there is presently a NE quadrant interchange allowing traffic to move between the CP (MILW) and BNSF (Q). However, there is no NW quadrant to allow Q traffic on to the MILW's bridge over Ol' Man River without some kind of changing a train's direction of travel.

Signed; perplexed.

Shortline614 wrote: ↑Thu Jan 13, 2022 10:00 pm

Gilbert B Norman wrote: ↑Thu Jan 13, 2022 12:50 pm For the love of me, Mr. Shortline, I'm at a loss to understand why CN would want it.

I think CN's interest stems from a larger growth strategy that they have been pursuing quite openly in the past few years. The former Grand Trunk Western and the Sarnia, Ontario-Halifax, Nova Scotia line are massively underutilized compared to CN's other mainlines. CN has been attempting to grow traffic over these lines as evident by the attempted Massena Line purchase along with CN's acquisition of two trucking firms.

Mr. Shortline, do I ever respect your analyses.

So if all they want to move traffic on their own rails potentially from Halifax to KC, then I guess the "Music Clef" X-ing Michigan on "The Funk", potential physical interchange issues at Springfield needing a "not too friendly UP", and "the Bridge" @ Louisiana (anyone really know what kind of shape it's in?) are of less concern if they are not trying to snatch "just in time" Detroit-KC auto assembly traffic from NS (WAB).

Finally, on the immediate point, even CPKC, with its "cobbled together" Trackage rights over NS(NYC), IHB, MILW routing is still at best at a disadvantage with the "Wabash Cannon Ball". Only advantage to CPKC is their CR Shared Assets access to any Detroit "Big Three" auto facility.

Gilbert B Norman wrote: ↑Fri Jan 14, 2022 8:05 am
What's Warren up to? Does he wish to establish an interchange with the UP (C&NW) at Clinton - and for what purpose?

Some coming to my mind are to keep GN and NP traffic away from the UP (RI) at Twin Cities thereby grabbing a better chunk of the rate Division and also to avoid Chicago congestion on whatever traffic they presently interchange there.

At Savanna, there is presently a NE quadrant interchange allowing traffic to move between the CP (MILW) and BNSF (Q). However, there is no NW quadrant to allow Q traffic on to the MILW's bridge over Ol' Man River without some kind of changing a train's direction of travel.

Signed; perplexed.

BNSF already has trackage rights from Clinton, IA south to the Quad Cities dating back to when Soo Line and BN split the DRI&NW. They operate a local out of Rock Island, IL most weekdays. Perhaps they would prefer to operate the local out of Savanna.

Mr. JayBee, I was gone from the MILW before that agreeement.

Again, from one who has been "on the ground" at Savanna "in the line of duty" (as well as riding "the Cities" as a paying passenger), I'm not sure how physically an NW quadrant between the Bridge and the Q could be built. As I recall (now been 40 years), as soon as you X the Q, you're as good as on the bridge X-ing Ol' Man River.

Gilbert B Norman wrote: ↑Fri Jan 14, 2022 8:32 am Mr. JayBee, I was gone from the MILW before that agreeement.

Again, from one who has been "on the ground" at Savanna "in the line of duty" (as well as riding "the Cities" as a paying passenger), I'm not sure how physically an NW quadrant between the Bridge and the Q could be built. As I recall (now been 40 years), as soon as you X the Q, you're as good as on the bridge X-ing Ol' Man River.

I took a quick look at the situation at Savanna with Google Earth Pro. The connecting track is in the NE quadrant of the diamond. So the BNSF local could come out of BNSF's yard, cross the diamond, and then back onto the DM&E main.
The bridge that you remember is a small bridge over a back channel of the Mississippi River, the DM&E main then runs south on the island before the bridge over the main channel. As the Crow Flies it is 1.7 miles from the diamond south to the main channel bridge. There is some room in the SW quadrant of the diamond to build a connecting track, but a Pedestrian bridge carrying the Great River Trail over the DM&E main complicates the matter and might require rebuilding to put a connecting track in that quadrant.

Mr. JayBee, just to clarify, that MILW-Q NE quadrant was there "back in my day" and long before that. I have no idea to what extent traffic was interchanged there. It probably, but even considering eleven years with the outfit I don't know, was there to take MILW detours in case the River Line was out of service.

But apparently, we agree that to build an NW quadrant will be a "challenge", and it still perplexes me as to why Warren even wants it if all it will do is expedite the flow of DRI Line traffic originating there taken in interchange with the IAIS (CRI&P). Of course, what's wrong with your own line extending Eastward from Quad Cities to Erie, then Northward through Thompson and on to Savanna?

Mr. Norman, I appreciate your comments. Unlike you, I have no railroad experience (at least not yet) so everything I know is collected from reading. I assume it's the same for a lot of people around here.

I had a thought that the Savannah-Clinton trackage rights might have something to do with directional running, but considering it's only over a small portion of the MILW-CB&Q river lines I don't think this is the case. I am also very confused.

Anyways, seem Mr. Buffet wants to expand his own train set into Mexico. I made its own thread since while it is related to CPKC, it isn't directly about CPKC. post1589482.html#p1589482

Gilbert B Norman wrote: ↑Sat Jan 15, 2022 8:36 am Mr. JayBee, just to clarify, that MILW-Q NE quadrant was there "back in my day" and long before that. I have no idea to what extent traffic was interchanged there. It probably, but even considering eleven years with the outfit I don't know, was there to take MILW detours in case the River Line was out of service.

But apparently, we agree that to build an NW quadrant will be a "challenge", and it still perplexes me as to why Warren even wants it if all it will do is expedite the flow of DRI Line traffic originating there taken in interchange with the IAIS (CRI&P). Of course, what's wrong with your own line extending Eastward from Quad Cities to Erie, then Northward through Thompson and on to Savanna?

I agree that building a connection in the NW quadrant is either impossible or at least extremely expensive as there is a Marina located there. But why would they want to build a connection in that quadrant? We are talking about a local not some through freight. BNSF's yard at Savanna is SE of the diamond crossing and would be the logical base for the local.

The problem that likely is the reason for the requested trackage rights is the bridge between Davenport and Rock Island. I have been told that it is nearing the end of its service life and will need replacing. CP (DM&E) can use the IAIS "Government" bridge easily, for BNSF it would be more difficult. BNSF's traffic off the Iowa portion of the DRI&NW is significant and they don't want to lose it. IMHO the cost to BNSF to construct a connection in the SW quadrant of the diamond at Savanna would be much less than the cost of a new bridge at Davenport even factoring in the likely requirement to demolish the old bridge without replacement. CP can manage without the DRI&NW bridge at Davenport, and so would not want to spend the money replacing it.

Messrs. JayBee and Shortline, one starts to wonder if the foundation of any Uncle Warren objections is simply to object to a combination out of which he will only be adversely affected. He is much the wiser (and we all know how wise he is even as a Ninetysomething), to protect an interchange at Laredo and other frontiers with the NdeM lest the Mexican government choose not to renew the franchise with CPKC.

Gilbert B Norman wrote: ↑Thu Jan 13, 2022 5:09 pm Mr. JayBee, unless there is an on-line industry with "oodles" of traffic, I fail to see how that former Alton Route line (GM&O) will really benefit either system.

Sure, for Alton to participate in line hauls from KC, but it will not benefit CPKC in the least.

If I'm overlooking something, be happy to learn. That's why we have a Forum.

I was asking what would happen with this line last year; I find it to be the most interesting specific question in the CP acquisition of KCS question. My understanding is KCS sends traffic between KC and StL, but not a ton either; kind of the same vibe as NS and New England via Pan Am Southern.

KC doesn't open up any new interchange partners for CN, they might get a slightly longer haul interchanging w/ western roads there. A CN acquisition makes sense to me, but CSX even more so, and CSX hasn't said a peep about it.

My prediction: CP/KCS continue to send regular but limited traffic over it, or CN or CSX somehow acquire it. Most posts I have read on this forum say there is little online traffic on the line for a short line.

Regarding CN acquiring the former Gateway Western, potential traffic over the line would mostly originate on current CN lines, and I think CN would struggle with severe traffic imbalance, loads west, empties east. BNSF, UP, and CP will not solicit traffic for interchange at KC with CN. So CN will likely have to build a Intermodal/auto compound/transload facility to obtain a significant amount of eastbound loads. People think CP will struggle to meet their traffic targets for the third year after the merger, CN will really struggle to create traffic over this route enough to justify purchasing it. Currently traffic over the line comes from northbound off of KCS, plus Schnieder Intermodal from KCS's Intermodal terminal at KC, and all but a handful of the cars are bound for CSX at E. St. Louis. CN will lose all this traffic immediately.
The only traffic they will get at the start is unit trains of grain from the elevator at Jacksonville, IL (which the would haul east to the IC mainline), and the small amount of traffic generated from small online shippers. You can bet that CP will reroute the CSX traffic anywhere but to CN at KC (via New Orleans or Chicago).

I think that this is just CN blustering at having lost the battle for KCS, and when the new head of CN is announced he will quickly realize what a mistake buying this line would be.

Anyone?

What kind of shape is that former Gateway Western line in, especially X-ing Ol' Man River at Louisiana?

Even if it were FRA Class 4, which I highly doubt, the route is circuitous from E St. Louis, and if CN's objective is to hang on to traffic originating on their lines a little bit longer for a better slice of the rate's division "pie" interchanging with either Uncle Pete or Warren, that "victory" might prove to be rather "Phyrric".

Mr. Norman the former Gateway Western now owned by KCS is a mixture of FRA Class 2 and Class 3 track with some slow orders. The bridge across the Mississippi River at Louisiana, MO was built in 1897 - 1898 originally consisting of 8 through Pratt truss spans of varying lengths, plus the cantilever through truss draw span. Three of the Pratt truss spans were replaced in 1945 with Warren through truss spans. Information is from the Bridgehunter website, and 38 photos of the bridge from various angles can be found here

https://bridgehunter.com/mo/pike/louisiana-rr/

The bridge will clear ISO containers doublestacked, the video I was watching had only 8' 6" high containers. Train speed was about 20 mph. due to the bridge, sharp curve at the west end of the bridge, followed by the BNSF diamond crossing. The westbound train, M-VNKC, had 43 wells of containers, half single stacked, and 33 cars of manifest traffic. The train had six big locomotives on the point, though only two appeared to be powering the train.
The train stopped at the east end of the bridge to confirm the bridge was lined and locked, and that nothing was nearby on BNSF.

KCS does run their big power over the bridge, but the bridge would be expensive to upgrade or replace, especially since it is over a navigable waterway, meaning lots of Red Tape.

JayBee wrote: ↑Wed Jan 19, 2022 11:22 pm Regarding CN acquiring the former Gateway Western, potential traffic over the line would mostly originate on current CN lines, and I think CN would struggle with severe traffic imbalance, loads west, empties east. BNSF, UP, and CP will not solicit traffic for interchange at KC with CN. So CN will likely have to build a Intermodal/auto compound/transload facility to obtain a significant amount of eastbound loads. People think CP will struggle to meet their traffic targets for the third year after the merger, CN will really struggle to create traffic over this route enough to justify purchasing it. Currently traffic over the line comes from northbound off of KCS, plus Schnieder Intermodal from KCS's Intermodal terminal at KC, and all but a handful of the cars are bound for CSX at E. St. Louis. CN will lose all this traffic immediately.
The only traffic they will get at the start is unit trains of grain from the elevator at Jacksonville, IL (which the would haul east to the IC mainline), and the small amount of traffic generated from small online shippers. You can bet that CP will reroute the CSX traffic anywhere but to CN at KC (via New Orleans or Chicago).

I think that this is just CN blustering at having lost the battle for KCS, and when the new head of CN is announced he will quickly realize what a mistake buying this line would be.

Only a handful of cars being interchanged w/ CSX in St. Louis surprises me. I would have thought, pure guessing no data, some of the value of the line to KCS is being their only access to CSX outside of New Orleans.