Latest CN buying rumor - is EJ&E next?

Why would Elgin, Joliet and Eastern Railway's parent company want to sell this railroad off?
www.railpictures.net/viewphoto.php?id=203796
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http://www.tstarinc.com/index.html

Not sure why, but Transtar has been selling off larger railroad assets the last few years. CN purchased another of their properties (Bessemer & Lake Erie) in 2004 (I think that's when it was).

Transtar 'History' webpage wrote:The Transtar companies consist of a group of rail and water carriers that grew up over the years to meet the transportation needs of the steel making facilities that were the predecessors of today's United States Steel Corporation. Historically, the Transtar companies were the wholly-owned transportation subsidiaries of United States Steel Corporation. In December of 1988, as part of a financial restructuring, these transportation companies were acquired by the new holding company, Transtar, Inc. Transtar, in turn, is owned by United States Steel Corporation.

The B&LE was not part of transtar when CN bought them. It was owned by Great Lakes Transportation along with the DM&IR, and was part of the DM&IR deal. One word describes this takeover of EJ&E, Doh! Yeah, they say they are going to make all kinds of improvements, but that is what they said when they took over the WC.

http://stopcntrains.blogspot.com/

Hahahahah cute.

Some HLCX units have popped up on the head of some EJE trains.

Happy Valentine’s Day

The CN is purchasing EJ&E trackage so that it can go around Chicago instead of through it saving somewhere between1 and 2 days. Unfortunately, the NIMBY's are out in force.

One article from the Chicago Trib will give you a flavor of what is happening.

The article is at: http://www.chicagotribune.com/news/loca ... 1111.story

Jerry

A couple months ago I had the privelege of sitting in on a presentation by a CN vice president on the EJ&E acquisition. It was a very interesting and insightful presentation, but after seeing it, I have reservations about this purchase, or more accurately, how CN will manage their new route.

One of the items shown at the presentation was a planned track map which would show the end result after it had been upgraded to CN's liking. Surprisingly, it will still have a LOT of single-track running on it. Much of it through Barrington and all those suburbs that have been complaining a lot. Some sidings will be added or extended, and some interchanges will be improved. But by and large, the end result still looked a little too much like the EJ&E, a lightly used railroad built around its schedule. Normally I don't try to criticize what big railroads do, because in the end they are businesses and need to make money. But CN's management style, their plans for the J, and the amount of trains they want to run on it don't look like a winning combination as things stand right now. The CN-IC merger pretty much resulted in the IC's management team taking the reigns of the railroad, and running it as leanly as possible. There are some benefits (mainly financial), but I've also noticed some detractors. Trains down the Elsdon sub used to absolutely FLY north of Blue Island, but in recent years their speed doesn't top 25 mph (most of the time). The IC's old line to Carbondale is running beyond capacity, lacking the second track it formely had (torn out in the early 1990s) - but there are no plans to restore capacity. This line also had an extremely high number of total meltdowns over the winter due to frozen switches and signal power outages. Quite honestly, I just don't have enough faith in how CN generally runs things to really go all out and say the EJ&E takeover is a great idea. They've really driven down costs, but don't seem to be investing in their infrastructure as much as much as other class 1s, and I'm not just talking about big projects - little "housekeeping" items like roadbed maintenance or locomotive rehabs don't seem to be very high on the list of priority list either.

Also, if CN's potential "upgraded" track map comes to fruitition, the Metra STAR line will either be delayed for a much longer period of time or dead completely. I can't see Metra even attempting to run scheduled commuter trains across an intermittently single/double tracked former industrial railroad, with lots of other freights thrown in the mix as well. The VP who spoke at the presentation I saw gave the impression that they wish Metra would stay off the J, and also said that Metra wanted a whole track for themselves to operate trains on - not necessarily an unreasonable requirement for a bi-directional scheduled passenger railroad, but CN wants nothing to do with it. I have a feeling it will take a lot of money from the state level to add capacity to that line in order for the STAR line to commence operations.

byte wrote: But CN's management style, their plans for the J, and the amount of trains they want to run on it don't look like a winning combination as things stand right now. There are some benefits (mainly financial), but I've also noticed some detractors. Trains down the Elsdon sub used to absolutely FLY north of Blue Island, but in recent years their speed doesn't top 25 mph (most of the time).

Well trains dont fly down the Elsdon sub because they don't normally have a favorable signal at CN (formally GT) Junction. The signal at Western is an intermediate and is 99% of the time an approach signal. Also, there are so many crossings between Western Ave and 159th. There's also a lot of riff-raff in the area that don't care and freely walk, run and drive through the crossings long after the gates have been down and functional. I'm actually quite surprised there are not a lot more fatalities and accidents in that stretch of track. If you go the other direction, there's usually to much going on at Broadway between the CSX, IHB and Iowa Interstate that there is rarely a favorable signal and is almost always a red signal.

byte wrote: This line also had an extremely high number of total meltdowns over the winter due to frozen switches and signal power outages.

Not just that line and the hand throws in Markham are not maintained.

byte wrote: The CN-IC merger pretty much resulted in the IC's management team taking the reigns of the railroad, and running it as leanly as possible.

The running joke is that CN actually stands for Chicago National now

byte wrote: Quite honestly, I just don't have enough faith in how CN generally runs things to really go all out and say the EJ&E takeover is a great idea. They've really driven down costs, but don't seem to be investing in their infrastructure as much as much as other class 1s

They don't run it, all the low end management run things how they see fit

byte wrote: little "housekeeping" items like roadbed maintenance or locomotive rehabs don't seem to be very high on the list of priority list either.

Look at a CN engine and compare it to the same engine run by the BN or UP. Even the NS have nicer power then most of what CN has.

J hogger wrote:Like I said before, they sound serious this time.

It appears the NIMBY faction is on the loose; time to call Animal Control and round them up.

WBBM 780 carried the story during the 6AM hour today.

http://www.wbbm780.com/pages/2658965.php?

More detailed coverage from the Chicago Sun Times:

http://www.suntimes.com/business/103338 ... 08.article

• ...whatever the cost may be, we shall fight on the beaches, we shall fight on the landing grounds, we shall fight in the fields and in the streets, we shall fight in the hills; we shall never surrender...
  
  CHURCHILL

,

Gilbert B Norman wrote:
More detailed coverage from the Chicago Sun Times:

http://www.suntimes.com/business/103338 ... 08.article

The STAR line will probably be the determining factor on whether or not this whole thing happens. Most of the arguments being presented by those suburbs are groundless, but CN's refusal to say anything other than "We'll work with Metra" (on what? mothballing the project?) and their obvious desire to not have passenger trains running on the J may be what shoots them in the foot. Hunter Harrison said in an interview recently that if the J takeover comes with too many stipulations, that they would waithdrawl their offer and that would be it (i.e., "I'm taking my ball and playing elsewhere!"). He may be true to his word, but if another class-1 (or even Metra) bought it and upgraded it to an extent which CN wasn't willing to do, you know they would be first in line for trackage rights.

Todays Chicago Tribune has a front page article showing the STB findings. Be sure to take a look at videos etc. for whole picture.

It can be seen at: http://www.chicagotribune.com/news/nati ... 3418.story

Regards, Jerry

There was a story on National Public Radio's "Morning Edition" on this subject this morning (28 July 08).

http://www.npr.org/templates/story/stor ... d=92633264
for the text story and a link to streaming audio

It explained the current congested situation, particualrly in Franklin Park, went on to discuss the EJ&E purchase and CN's rationale for it, and included audio from concerned citizens along the EJ&E-- who did not want to be classified as NIMBYs.

Overall, I believe the piece was somewhat biased against the railroads and the plan, being that it gave too much air time to complaining (in both Franklin Park and along the EJ&E). [The "If you didn't want trains, why did you move there?" statement eeps coming to my mind.] The reporter's use of the word "quadrupled" in describing an increase from 4 to 5 trains up to 16 to 20 trains a day on the EJ&E was also IMO provocative.

However it was mentioned that if freight trains can't get through (or around) Chicago faster, the trucking alternative is far less environmentally sound.

I came across this NPR story as well. My gut reaction is that 20 freight trains a day should be perfectly manageable for any community. It seems that the people near the EJ&E have become a bit spoiled by the relatively scarce train traffic. But...there is no denying that freight trains can be quite a disruption if you're not used to it.

For what it's worth, I felt the story was pretty balanced (at least for the average person). The text explains both sides well.

http://video.nbc5.com/player/?id=288320#videoid=288320

Gotta love this video.

U-haul asks why EJ&E's owners want to sell - right now, rails are hot. Buffet and Gates are buying rail stocks, and they don't buy anything but the best. Further, CN has a lot of trains they can run over these tracks that aren't being run now - in other words, EJ&E is a very good fit for CN's operating model. Under this new operating model, the EJ&E tracks are worth more to CN than to transtar, so they likely picked a price in between the value to Transtar and the value to EJ&E and brought the deal to STB. Right now, if this was a bigger deal and Transtar were a publicly traded group, Jim Cramer would have a calendar on his wall decrying the waste of time in evaluating the acquisition, similar to the calendar he had for FCC approvale of Sirius-XM. It's not a great deal for local residents, but the railroad was there before they were. It's also a good deal for NE Illinois job creation.