20 MILES of trains backup near Chicago?

The way the OP stated it, that 20 miles of trains could be spread all over the country, not just in Illinois.  If crossings were blocked for long periods of time, it would be a news event, and I haven't seen it mentioned yet.  Let's try to be respectful of others feelings and only post what we know when it comes to "real life" events.

Chuck

If a transcontinental container train is two miles long, that is a ten train back up.  Some are destined for Chicago, some beyond.  Either way, Omaha cannot be happy about it.  John

I find the subject interesting. A few days back there was a blurb about the railroads pointing fingers at everyone else but themselves when UP and BNSF were  straightening this mess out. What’s the cause? There’s no UP/SP to blame this time. Can it be just so many more than usual containers of product arriving in the US suddenly?

@Sam Jumper posted:

I find the subject interesting. A few days back there was a blurb about the railroads pointing fingers at everyone else but themselves when UP and BNSF were  straightening this mess out. What’s the cause?

Generally, lack of workers at the ports to unload the ships, handle the containers onto highway trailers or RR train cars, lack of workers in the Chicago hubs to unload the RR train cars, and lack of drivers to to move the containers on trailers out of the hubs to customers.

There’s no UP/SP to blame this time. Can it be just so many more than usual containers of product arriving in the US suddenly?

Nope. See above explaination. Not only that, container ships are sitting off the coast of California and Oregon for weeks at a time, just waiting to enter ports and get unloaded. Now add to all that, the serious crew shortages on all the Class 1 railroads, and the continuing end result is a very, VERY serious mass!

@Hot Water posted:

Not only that, container ships are sitting off the coast of California and Oregon for weeks at a time, just waiting to enter ports and get unloaded. Now add to all that, the serious crew shortages on all the Class 1 railroads, and the continuing end result is a very, VERY serious mass!

With fewer trains to run under PSR compared to just a few years ago, any “extra” crews are long gone? Is this another way that PSR helped railroads shoot themselves in the foot? Where did all of the dock workers, truck drivers, terminal employees, etc go? I’ve been working all through the pandemic being “essential”, so I don’t know first hand about the extended and extra unemployment or whatever that’s helping folks stay home. Commuter traffic seems back to pre-pandemic here in Chicago. Is this whole mess a matter of people still staying home and not at work? It’s very mind blowing to me.

Make no mistake…PSR (Precision Scheduled Railroading) has nothing to do with customers or moving trains expeditiously. It has everything to do with maximizing shareholder value.

I recently read a multi-page white paper on PSR. The word “stockholder “ appeared in this document dozens of times. The word “customer” did not appear even once.

Rich:

According to the article, UP was not accepting any traffic from the LA basin to the Global 4 facility on the old CNW main.  Most containers there go from railcars direct to trailer chassis.  No storeage.  So no chassis, the whole thing comes to a complete halt.

Seem to recall the Union Pacific being backed up to central Iowa in terms of freight trains waiting to get into Chicago - - - in pre-Covid days.

While PSR may indeed be a major factor, I also believe a manufacturing concept known as "just in time" inventory planning is also complicating this situation.  A few decades ago, some "smart" accountants figured out that with improvements in communication, shipping and logistics, manufacturers could significantly reduce the capital they had invested in inventory and then redeploy that capital into other money-making investments, or into dividends.

This newer system works by careful planning of the manufacturing process so that raw materials, parts and supplies are delivered to a manufacturing site just days before needed.  No more having months worth of the stuff sitting in a factory waiting to be used, and a lot less risk that inventory value will decline because it suddenly becomes outdated.  A lot less space needed in factories, too.  To grasp this, think about the old-time mounds of coal, coke and ash seen at steel mills being replaced with strings of hoppers and other cars delivering only what is needed for that week's work.  And, did you notice how many car manufacturers are slowing production because of a shortage of computer chips?

Of course, this method of manufacturing put a great strain on the global logistics system and that system has slowly fallen behind.  Ports are plugged (and were, even pre-Covid), rail delivery points are too full, and empty containers and unused trailer chassis' are found in the wrong places because no one wants to incur the cost of moving them to where they are needed.  I remember seeing flat cars loaded with multiple empty trailer chassis heading to ports years ago; not so much any more!

Even "efficiency" has costs that can't be avoided, but now the big players (manufacturers, retailers, logistics companies and shippers) are trying to push those costs to someone else (think infrastructure (ports, rail, highways, etc.) improvements to be funded by US taxpayers).  This process also explains why truck drivers and rail workers were and are made "essential workers" during the Covid crisis.

Chuck

Usually, there's plenty of blame to spread around, but, this time, I'll side with the railroad.

Consignees are delaying pick up of their containers, and then holding the container and chassis on their property for storage.  Without containers being picked up promptly upon arrival and the chassis returned to the railroad within a couple of days, the railroad runs out of chassis.  Also, it has to stack containers not promptly picked up, and there's not much real estate on which to do that.  If you are in the railroad business and you have no more space to unload and stack containers, then you are closed, until your customers pick up their stacked containers.

Demurrage fees -- which are charged, beginning at a specified number of hours after the consignee has been notified of the availability of its car, trailer, or container -- are apparently not expensive enough to inflict the amount of pain required to change the behavior of some consignees.  With the shipping costs for a container having gone sky high, the demurrage rate seems insignificant these days.

And, as a result, the honest consignees, like Scott Mann at Sunset/Golden Gate Depot, can't get their containers delivered because of the congestion in the supply line.  (Note: Scott Mann does not depend on the railroad, but the mess at the railroad increases backup at the dock and just offshore, and the chassis shortage also affects delivery to consignees like him by truck.)

I think Hunter Harrison was right about companies not unloading railcars and containers quickly enough to get those properties back into circulation

Just in Time works when your suppliers are relatively close.  But no way if your suppliers are half a world away.  Or if you have third party logistic companies who can store nearby.

West Coast ports wete becoming log jammed way before CV-19.

@Dominic Mazoch posted:

Just in Time works when your suppliers are relatively close.  But no way if your suppliers are half a world away.  Or if you have third party logistic companies who can store nearby.

Sorry but that is simply not accurate. I worked previously for JIT manufacturer and we shipped world wide and had world wide suppliers as well. Being in the high end nickel alloy business providing JIT saved money all across the board along with waste at multiple levels.  It's all in the proper planning and you can't even begin to blame all the industry disruptions caused by the covid shutdowns on JIT. No supply chain was nor could have been prepared for this.  The shutdowns have disrupted every single supply chain for every industry across the board.

@TexasSP posted:

...The shutdowns have disrupted every single supply chain for every industry across the board.

Agreed.

You may recall that when Covid first hit (Feb/Mar 2020) that there were some shortages of food items at grocery stores. A friend of mine, who is a long-haul trucker, told me about this, and what the government did to mitigate it. The problem was not a production problem, it was a delivery problem. As warehouses around the country began putting protocols in place to deal with Covid, productivity suffered.

When arriving at a shipper, a driver could typically expect to be loaded in 60-90 minutes. With the Covid slow-down these times stretched to 4 to 6 hours! The problem for the driver was that all this waiting time was “On Duty” time, which ran down his driving time clock for the day. He could not drive as many miles as he normally could because of all the time wasted at the shipper.

The problem was fixed when the government enacted what the trucking industry calls “The Covid Waiver.” This waiver applied to loads of medical equipment to be used  directly in the treatment of Covid, and to loads of food, intended for delivery to grocery stores. What did the waiver do? It waived all the hours of service rules that apply to truckers! If a trucker was behind schedule and wanted to drive more than 11 hours in a day to make up time, he could do it. My friend once had a high priority run from Fort Worth, Texas to Allentown, PA (about 1,400 miles) hauling refrigerated food, that he did in one day…almost 20 hours straight.

Unfortunately there is no such waiver, or any other method, that can help the railroad industry catch up like this.

OK, CV-19 is out outlander. Big time.

However, has anybody thought what would happen if the Ports of LA and Long Beach were taken out of action due to the effects of an earthquake and/or tsunami? Terrorist attack? Same for Cajon Pass.  Beaumont Pass. Major Interstates plus BNSF and UP uses those passes.

In Texas, the Uri ice srorm caused service disruptions to the major petrochemical plants adding to service issues in many areas.  Many areas of Texas would have been out of power for months if ERCOT did not shut down the grid.

If Hurricane Ike would have came ashore about 10 miles to the west, the Houston-Galveston petrochemical complex would have been out for months. Not to mention major damage to the road and rail systems.  Harvey also shut things down, weeks for some things

Point is, one cannot plan for any and all things with a bare bones operation.  Murphy will win over time every time.  For example baseball teams could save millions each year with just 9 players.  But the picher's arm would become shot.  No replacement for injuries....

What is plan "B".

And Rich has a big point.  If there is no product, there will be no customers.  And in the end, a company with no customers is of no value to anybody, including the stockholders. Basic capitalism.

The pendulum of capitalism is at work, corporations will start throwing money at the delivery process, clean up this mess then we will have oversupply of shipping and tighten shipping costs then we will have a shortage once again of delivery. It seemed to work better when shipping rates were “standardized”. Every one made a decent living but deregulation cut profits to the bone and no one wants to work for bones. This too shall pass

I think companies are going or are facing the music.  And there are going to be three pieces of music to answer to:

1.  Why is my product late?

2.  Why does my product cost more?

3.  Why is there no product, period?

>>>>>>

Rich,

The FRA did give the railroads an option to give away the HOS for covid.

Essentially, those who drop to COVID, grind everyone else down to the bone til they dropped as well.

Containers are at a premium too.  Companies needing them are outbidding normal rent rates, and loaded containers in China and Taiwan have been emptied, their contents warehoused, and the container handed over the the one paying up to 4 times the going rent rate.

@Dominic Mazoch posted:

I think companies are going or are facing the music.  And there are going to be three pieces of music to answer to:

1.  Why is my product late?

2.  Why does my product cost more?

3.  Why is there no product, period?

There is nothing new to this scenario. It's been faced and will be faced as long as people breathe and industry exists.  If it wasn't for solving problems most companies would cease to exist. We're and innovative species and will continue to move on.