MM&A purchase of CSX Montreal Secondary?

[roberttosh]

I'm not sure how to explain this to make it any more understandable, but here are some absolute facts:

(1) As of today, MMA cannot interchange directly with CSXT in any way shape or form but instead needs to route cars through the CPRS to get to CSXT.

(2) MMA could buy every mile of railroad in North America, but unless they take control of the CPRS line between St Jean And Adirondack Jct or get interchange rights granted to them by the CPRS, then they still cannot get to CSXT.

(3) Mass does not touch or border Maine. If Mass annnexed Maine and Maine now became part of Mass, the two Mass' still wouldn't touch each other.

MMA may in fact run their trains right by the CSXT interchange at Adirondack Jct over CPRS trackage rights, but they still cannot interchange with them (Paper barrier). MMA and CSXT can do all the deals they want, but regardless, unless a new deal is made with the CPRS (which may in fact happen happen), then nothing changes.

[fire651]

It's perfectly understandable. At this stage this is pure speculation and I think you're reading too much into it Robert.

[rrfoose]

I'm curious as to what MM&A could gain from buying this line... There won't be a ton of traffic flowing between the two sections (CPR trackage rights or not). The NYS&W interchange is fairly pointless - they only run to NYC, and CSX & CP can get New England traffic there much quicker. I don't see any high priority intermodals plying the rails in the near future, and from what I understand, there is relatively little online traffic. Could MM&A make the line profitable than it is today?

ORRR - to really stir things up... Maybe the company who owns MM&A (the name escapes me at the moment) is planning on buying DO, who owns NYS&W. A long, but single line route between Maine and New York/New Jersey!

[CN9634]

To respond to Robert, I understand that the MMA would not be connected as a system, however they would be connected to CSXT, just not able to move traffic through to the other half. I'm quite sure if the MMA picked up that trackage they'd figure out a way to rebuild the tracks and cut a deal with the local Indians in the area. Judging by the way the MMA took CDAC and turned it from a red line RR to a black one, I'm quite sure they could build traffic along this line. It's all just a matter of time. Isn't the MMA 5 year anniversary coming up? Or am I a year off?

[BAR]

According to their website the MM&A began operations in January 2003 so their fifth anniversary will be coming up next year.

[murray83]

Face it,much of the old CP in Maine has little online customers with long hauls through no mans land and most of the old B&A other than the mills are slowly dieing off will hurt the books in the upcomming years so this would be a way to expand into other regions to boost traffic numbers.

Saint John's container traffic does not go towards the MMA unless the customer asks for it since it was asked about earlier.

[CN9634]

So are you saying the MMA is dieing and will die out unless they purchase new track? I strongly disagree. The MMA has added many customers and improved services since the 2003 takeover. I'm very sure that the MMA is here to stay.

[murray83]

The MMA still has to look for other customers,the forest products industry in both Canada and the US is very shakey and have a hard time trying to compete with Asia and such and at least 2 large paper mills here in NB are closing and others have had massive layoffs its only time the large 3 mills on the MMA in Maine meet that same fate and as I type this I hear 1 already has announced a decent sized layoff and line shutdowns.

This new line they are looking at is just like the Moosehead Sub very long with little online customers but if it can get them closer to other markets I say go for it,because if say the 2 mills in Millinocket were to close it would be a large blow to the MMA on paper,I'm just trying to look at this business wise and as a business saying goes if it can go wrong it will so have a back up plan,seems the MMA is doing just that.

Just a side note anyone know when CP'S contract with chrysler expires? seems thats another traffic source the MMA has made a decent profit at.

[roberttosh]

I have to give the MMA a lot of credit. Most everyone in the industry that I know (including myself) thought they had a snowballs chance in hell of making a go of it up there - even more so after their biggest customer closed down the day after they took over. That being said, as the previous poster pointed out, with a takeover of CSXT's Massena, they would just be further diluting their traffic density as this line is more of an overhead route than a generator of on-line business. If you've ever been up to the County, you would see that there isn't a hole lot of growth opportunity other than Forest products and even that industry is not healthy.

A previous poster mentioned that MMA has added many new customers; I would love to hear about these. One new move that I'd seen was a log or chip move to one of the PAR mills; possibley Rumford, but not sure if it's still happening. The scary thing for MMA is that they rely so heavily on just 3, maybe 4 customers. Things could go South for them pretty quickly...

[CNJ]

This is assumption on my part, but the folks running MMA must has some sort of "forward vision" which is why they would go after this additional trackage.

Your opinion(s)?

[murray83]

Thats was my whole idea in my post above.From what I understand from the guys at the NBSR basically west of Sherbrooke is their big money makers since there is more online industry over a shorter distance and east of it is basically bridge traffic over a very long haul.

If say in theory the forest products industry bottomed out the entire BAR portion would be in serious trouble and traffic east of Sherbrooke would be very minimal.

As I said above I think this is MMA's very own back up plan in case that was to happen.

[CN9634]

Good news for the MMA. PQ has announced a 75Million dollar bill to help shortlines in the area.

[joha107]

If they are getting the entire Montreal Sub and St. Lawrence Sub along with all current traffic, then it could be a big help to them. I'm wondering though how much CSX will give them, right now the two CN trains that run this line are rumored to be going to the D&H, whether it is permanant or temporary is unknown. On-line business consists of a several small customers and then Alcoa in Massena, some industrial park in Beauharnois, and Fort Drum which all provide a good bit of business.

There is some potential growth up here, if CSX lets MM&A have the Fulton Secondary, they may get a new Ethanol plant along with a proposed Coal to Natural Gas conversion plant which would be pretty large customers. CN has also proposed a container train for this line, though this would require some trackwork to restore the line back to a 40 mph speed limit. How profitable this line will be depends largely on how much of the current traffic they would keep, if CSX/CN/CP diverts traffic it may not mean much.

[NYC27]

Lots of speculation here, but I've heard that Iron Road took a look at relaying the end of the Montreal Secondary in the past and were stonewalled by the Indians (my source was on the hi rail trip, says he was never so scared in his life!!). I don't think MMA would be talking with the City of Chateugauy about raising the bridge on the out of service portion if there was a significant paper barrier preventing connection to the rest of the MMA. CP has done some really stupid things in their line sale agreements over the years and leaving the door open to connect these two lines could be another one (for example, the 1980s sale of the WC included barriers to keep the CN from using it as a bridge route - how did that work out?).

Also, a NYSW connection in Syracuse would absolultely be important because it would let MMA and NYSW execute a haulage agreement to get to NS at Binghamton and bypass CPRS for this traffic as well. Whether CSX is allowing this to be in the deal is also speculation at this point. Let's wait and see.

[CN9634]

To further speculate, an MMA-NYSW merger would be quite interesting.
Also Steve Boyko has reported that there was an accident on the MMA? More details here, http://www.theboykos.com/nbrr/blog/