Portland Waterfront Rail Ops (Yard 8, Intermodal, etc)

Another successful weekend moving water ... Still shocking to see Pan Am running such long trains.

Those of you who are interested in the transportation history of the Portland/South Portland waterfront might enjoy this:

http://sentry.mainelymediallc.com/news/ ... _Past.html" onclick="window.open(this.href);return false;

Sixty containers on this one ... headed south no less. Most likely all loads.

Different video, same train. They also counted sixty containers.

I caught AYWA in Scarborough last night:

https://www.youtube.com/watch?v=XD7v0YsDVJU" onclick="window.open(this.href);return false;

Wow. Took a look at the video ... fantastic to see solid unit train business like this. So .... what was the car count?

It was 15°F and windy (windchill was 3°F); I could barely hold the camera, let alone count cars.

Haha ... I figured if you had a number you would have posted it ... Regardless it's 60+ containers running as a single stop unit train. That kind of business is a money maker.

Wrong on that assumption...

Dray cost into central Mass from central Maine is typically about $500 - $700 per van truck load depending on capacity.

Per intermodal LOAD (costs are by load not by hour), typical dray cost less than 50 miles is no less than $250 (I've seen it more like 285-325). Since intermodal is dray - rail - dray, we assume at least $500 per load goes to the trucking company getting the container to and from the rail. Assuming the RR is cost competitive with the trucking company, lets say its $700 in gross revenue a container - $500 to the trucker. Leaves $200 per container to work with which at a train of 60 containers is $12,000 in revenue to the RR.

Been taking about 3 crews to operate @ 12 hours each @ $25 per hour per person (very conservative on that) times 2 people = $50 per hour time 36 hours = $1,800 fix labor cost for rail transportation. RR has to pay to load/unload the entire train, probably a crew of 3-4 guys working 12 hours each (lock/unlock ICBs, check paperwork, inspect equipment, ect), we assume at least $20 an hour. $80 per hour for the crew times 12 hours to load times 2 for the unload = $1920.

Fixed labor per train is about $4K

Locomotive fuel tank carries more than 3,000 GAL of fuel, assume we burn half a tank each. I don't know enough about this so maybe I'm way off but lets assume 4 GP40s @ 3,000 GAL each and we consumer half the fuel to move the train = 6000 GAL consumed at avg diesel fuel price of $2.54 = $15,240 in fuel (assume there is a fuel surcharge per container, might kick in a few Gs to this) so lets call fuel $12,000 after FSC.

So to load the train, get it moving (probably a 4th and 5th crew for switching, maybe some carknockers, paperwork, dispatching, ect needed too) is a fixed cost of about $1800 + 1920 + $12000 + $2000 MISC or slightly more than $17,500. Conservative estimates on my part again, on this RR its probably more like $20K just to get the containers moved from terminal in WTVL to terminal in AYER. That means you gotta be making $333 per container to break even assuming you give the trucker $500, which means you charge the PS about $850 per container which could get me a truckload from Maine to PA or Ohio no problem.

Oh, and you run the train again back to Waterville completely EMPTY. So whatever your fixed cost is to operate is doubled for the entire service so $34,500 per round trip, so you got to make slightly less $600 per container to COVER COSTS, which is likely $1150 - 1200 charged per container to PS. That equivalent gets me a truckload to Chicago/Wisconsin OR a Boxcar from Waterville to Worcester with 4 times as much tonnage in it.

A few things I think:

PS is NOT paying $1100 - $1200 per container, probably slightly more than a truck dray. We really don't know but I'd guess more like $700-800.
Pan Am thought this was good PR plus would springboard intermodal interest with other shippers, some who have tried it but never gotten past trials.
Without expanding the service either A.) Into a new market or B.) as part of an existing NS or CSX service, it won't succeed.
Building density for shippers beyond 50 miles from Waterville will be tough, average rate per mile can be $.90 to $1.00 on a spot rate plus the up front $250ish. If you contract a rate with a trucker, you might be able to get that down but you need to guarantee them volume.

Remember, the fixed costs remain the same so adding train density and reducing costs are both key. For Pan Am, the cost reduction is going to be much easier to control than the freight market... I would try to reduce number of crews to move the train, use more fuel efficient locos (C40s?), and tie into another RR's network to attract IMCs so you can build density AND reduce the cost of operating two terminals (load at your own, unload at another RRs terminal).

EDIT: I also forgot the container/chassis lease costs. Chassis is usually $10-15 per day. Cycle time would be 3-5 days. No idea about the container. 60 chassis * 10 * 3 days on the road * 2 drays = $60 in chassis fees per container. Once again, no idea how much the lease would be on the box from Eimskip.

The fuel looks way off to me. There's no way they burn the same amount loaded vs. unloaded.

A pair of Dash 8s would handle these trains very easily. Likewise, three GP40s ought to be able to do it. They had three GP40s on the empty train I saw the other night and they sounded like they were only in third or fourth notch.

A GP40 in third notch burns 40 gallons per hour. Fourth notch: 60 GPH. Sixth notch: 100 GPH. Eighth notch: 170 GPH. Idle: 5 GPH.

SD40-2s have the same fuel burn characteristics but more tractive effort, so you can move more with an SD40-2 but not necessarily at the same speed. On a relatively slow railroad like PAR, a pair of SD40-2s would be adequate (and I believe that has been the power on some of the previous WAAY or POAY runs). One of the first runs (maybe a test run?) had just a single SD40-2. Smaller number of containers, obviously, and with PAR it's never a good idea to trust a road train with only one locomotive.

Anyway, those GPH numbers might help you guys figure out the fuel burn for these trains.

Alternatively, the limit for an intermodal container that's going to be drayed is about 40 tons. AAR average (including e.g. services that have to cross the Appalachians and Rockies) is 473 ton-miles per gallon, so that would suggest something like 3 gallons/mile over the roundtrip (5 gallons full and 1 gallon empty). MEC407's figures would imply (assuming 25 mph in third notch) about 4 gallons/mile empty. Figure 9 gallons/mile roundtrip average (arising from a combination of low speeds, more idling due to passenger trains, and less efficient older locomotives which might not be the best maintained specimens). That still gets a total of 3600 gallons for the round trip, which is a round-trip cost of about $9,200. Leaving everything else in your estimate, that gives a roundtrip cost of about $20k... at 60 containers per RT that's $333 in costs per container.

You can shake the math down however you want. They aren't getting rich running these trains, and you can certainly argue the fact they aren't even making any money. Even is PS is the one paying for the boxes and chassis', and if they have drivers on staff to reduce the dray cost from plant to ramp in Maine, the margin is extremely slim on such a short move at the volume they are moving. I've heard elsewhere that they are in fact running the service as is at no profit/slight loss. The whole point right now is to prove they can make the service work. Because the potential for longer corridors and bigger markets, that would bring in steady and profitable revenue, outweighs the upfront losses.

Probably right on the fuel but then again, these are extremely light trains (I've heard them call in at about 3000 tons on a 65 container train, or 13 'cars'), but thats my only week point on the math. Even if you cut my figure in half, for the round trip you still gotta be charging $800ish per container to meet costs... I didn't factor in a fixed cost of infrastructure use either.

Also my dray cost for the trucker is conservative... its likely more than that. Trucks don't just sit around and wait for their next load (some people think they are just driving around like Uber waiting for a call), they make money moving and have their days planned out fully. RC Moore has the contract up at Waterville and they are large enough through all their lines of business to keep trucks running.

40 tons is inaccurate for a container, a loaded truck on the road has a gross max of 80,000LB (Maine is 100,000lb but you have to load to the destination too, Mass was higher as well but I heard that has changed and it depends on legal roads), a cab is usually no more than 35,000lbs so you load a container/trailer up towards 44,000lb. A container is typically no more than 22 short tons... if it is you run into DOT problems real fast.

SO lets put this 'huge' train in perspective

Each container is 22 tons of cargo, a regular plate C loads up to about 75tons of cargo and a Plate F loads up to about 96-100TONs. So, the 60 car water train equals about 18 loaded plate C boxcars or 12 loaded Plate F boxcars of cargo. So whenever you see the long container train, think its the same amount of cargo as a 12 car Plate F freight operating loaded from Waterville to Ayer and then from Ayer back to Waterville empty.

Big revenue there. Wonder why the Class Is are trying to get doublestack on all their corridors? Because your max tonnage per doublestacked well car is still super light compared to a boxcar... You also have to run a huge train and over a long distance to compete with the trucking markets. So if you know the fixed cost of operating a train and the terminal, then you need to build train density to combat the cost. Fuel definitely changes from loaded to empty or however many units you have, but on a per ton basis you should know how much this is.... at least all the Class I's do. It's funny their philosophies are different.. in the east NS will run a train at a loss even if its just got 1 container, CSX will annul the train at a certain threshold (based on similar math I provided) and double it with the next one.

Pan Am definitely isn't making money on these runs I can promise you that... not unless PS is paying a premium which I doubt. Remember, Eimskip and the chassis fleet owner gets a cut too (Maine Port Authority maybe? Look at the mud flats or SCAC marks) and that isn't factored into my numbers.

At almost 2 years into this experiment, you would think by now we'd have an idea if new traffic was coming. I was told about a few prospects, and say test loads but nothing has come of it... last April I was told new customers would be online by August and clearly that hasn't happened.

Unless the new customers are using Eimskip containers as well ...

40 footers won't work for everyone... people who want to ship for example retail products have almost as much packaging as products so the density is much lower. I've seen 53 containers loaded to the gills with anything from tires, to retail goods, to lumber and much more. Why do you think the domestic standard from trucks to containers is 53? Once again Pan Am being cheap. Not sure why you are so excited about the grand mis-venture Pan Am has once again found themselves in but don't be fooled by appearances.