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  1. #1
    Senior Member JohnDoe2's Avatar
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    Why Railroads Can’t Keep Enough Boxcars in Service

    Why Railroads Can’t Keep Enough Boxcars in Service

    Aging symbol of U.S. economic might is being scrapped faster than replacements built


    That symbol of economic prosperity, the railroad boxcar, is getting harder to find as the rise of intermodal container systems lead to more being scrapped for their metal value and fewer new ones built. PHOTO: STEPHEN B. MORTON FOR THE WALL STREET JOURNAL


    By BOB TITA
    June 21, 2015 5:33 a.m. ET

    A shrinking supply of boxcars—once the ubiquitous symbols of U.S. railroads and a rolling bellwether for the economy—is causing a freight-hauling crunch for the industries that continue to use them.

    The number of boxcars in service in North America fell by 41% in the past decade to just under 125,000 last year as 101,600 cars were scrapped and only about 13,800 replacement were added. That downsizing accelerated a decades long shift by railroads to more specialized railcars and intermodal carriers that allow shipping containers to hop from trucks to trains.


    While the transition has worked fine for many shippers, paper manufacturers, lumber producers and other companies that rely heavily on boxcars to protect and move heavy shipments say the fleet has declined so much that they’re struggling with a boxcar shortage.


    Paper and building products maker Georgia-Pacific LLC. has had to periodically slow production at some paper mills, and idled one mill for a short time recently when it couldn’t obtain boxcars to move its paper. The paper industry accounted for half of the 1.25 million boxcar loads in North America last year.

    ENLARGE

    “I can’t get more cars,” said Glen Courtwright,director of strategic operations for Atlanta-based Georgia-Pacific, which leases about 1,500 boxcars at any given time. “The boxcar supply is less than demand.”

    Federal regulations limit boxcars to 50 years in service. More than 75,000 will reach that age over the next 15 years. Without significantly more new boxcars, paper company executives say they will have to rely more on trucks, which by some estimates cost 20% more per ton than shipping by rail. But the railroads, railcar-leasing companies and the companies that use the cars have shown little enthusiasm for big investments in new boxcars.


    “There is a looming crisis,” said David Friedson, director of logistics and distribution for Memphis, Tenn.-based Evergreen Packaging Inc., which specializes in paperboard for milk and juice cartons. “The next three to five years is when we go over the cliff and boxcars just come out of service.”


    Railroads attribute the difficulties with boxcars to congestion and operational problems at individual railroads rather than an overall shortage. The railroads say they are eliminating traffic bottlenecks and making other improvements that will enable faster round-trip times for railcars to better meet demand.


    RELATED




    “A lot of the service metrics are moving in the right direction,” said Michael Rutherford,assistant vice president for industrial products at Jacksonville, Fla.-based railroad CSX Corp.

    The boxcar’s origins stretch to the earliest days of railroading in the 19th century, when flatcars and open wagons were enclosed with wooden shells. Boxcars’ versatility made them indispensable for shippers and railroads, which introduced longer, steel-bodied cars last century. They remained kings of the rails until the 1960s, when businesses began shifting packaged freight to truck trailers and bulk commodities to specialized railcars.


    Lower freight volumes in the wake of the 2008 recession and high prices for scrap steel hastened the boxcar’s decline-providing incentives for railcar owners to junk older boxcars—although such scrapping recently has slowed.


    Today, boxcars account for only 3% of North American freight-rail traffic, but generated about $6.3 billion in revenue for the rail industry in 2014, or 8% of industry’s total revenue, according to AllTranstek LLC, a railcar management-and-consulting firm.


    Railroads say they won’t stop running boxcars, but their capital spending is mostly devoted to locomotives and route expansions rather than new railcars. The railroads are backing a standard boxcar model that is 60 feet long, with maximum loaded weight of 286,000 pounds—10 feet longer and about 23,000 pounds more than many boxcars now in service. The added size means railroads could service customers with fewer cars, easing congestion.


    ‘Either the rates have to rise or the cost of a new boxcar has to come down. ’


    Richard Kloster
    , AllTranstek

    “The larger and more versatile we can make these cars, the more [money] we’re going to make off them,” said Mike McClellan, vice president of industrial products for Virginia-based railroad Norfolk Southern Corp., which operates about 14,000 boxcars that include 19 different configurations.

    Still, railroads aren’t ordering many new cars. One big obstacle is price. New boxcars cost around $135,000. The rates that paper companies and other shippers pay for boxcar service typically include monthly equipment charges ranging between $450 and $700.

    That is decent revenue on a 30-year-old boxcar that is long since paid for itself, but well below the $940 to $1,100 in monthly car-hire fees needed to profitably deploy a new boxcar, said Richard Kloster, senior vice president of AllTranstek.


    Those low rates effectively kept railcar leasing companies from soaking up demand for boxcars as happened when grain, open-topped and other railroad-owned car fleets shrank. Despite their complaints, shippers say a significant increase in boxcar-hire rates would erode the railroads’ cost advantage over trucks and cause companies to shift their freight to trucks. Some shippers are advocating for a regulatory extension of the service life for existing boxcars service to 65 years from 50. Nevertheless, higher costs for boxcars appear inevitable.


    “Either the rates have to rise or the cost of a new boxcar has to come down,” said Mr. Kloster. “There’s just no consensus on what’s required to create an economically viable boxcar fleet.”


    The problem perpetuates itself, because low demand prevents the top companies in North America building new boxcars— GreenbrierCos. and National Steel Car Ltd.—from scaling up production in a way that could bring down the average price of new cars. Industry analysts estimate about 4,000 new boxcars would be needed annually for the next several years to offset those being retired because of age.

    Manufacturers last year made just 692. During the first quarter of this year, they delivered just 67 and received 120 orders, according to railcar trade group Railway Supply Institute.


    Meanwhile, the car manufacturers say they are devoting more assembly-line capacity and engineering resources to meeting a deluge of orders for tank cars to haul crude oil. “Tank cars are taking precedence over everything,”
    said Tom Jackson, vice president of marketing for Greenbrier. “The boxcar is not a top priority.”


    There were more than 52,000 orders outstanding for tank cars at the end of the first quarter compared with just 4,363 orders for boxcars, said Railway Supply.

    http://www.wsj.com/articles/why-rail...ice-1434879182

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  2. #2
    Senior Member artclam's Avatar
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    The numbers of railroad owned freight cars has been declining for more than 50 years. Railroads would rather leave the car leasing business to other companies and concentrate on actual transportation. As for the boxcar shortage... I wonder why the shippers can't use containers instead? A surplus of containers accumulates in some ports.

  3. #3
    Senior Member JohnDoe2's Avatar
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    Boxcars vs. Intermodal

    7384 views



    Rastafarr

    • Member since
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    • From: Fraser Valley, BC
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    Boxcars vs. Intermodal
    Posted by Rastafarr on Friday, March 22, 2013 7:01 PM
    Someone fill me in here, and forgive me if this is a silly question. Why are boxcars still relatively common on the Class 1 railways? Do intermodal containers not carry exactly the same items and do so more efficiently? What am I missing?
    Stu


    Titus Ore and Timber ca. May 1929
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    dehusman

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    Posted by dehusman on Friday, March 22, 2013 7:11 PM
    Cubic ft and tonnage.
    A modern boxcar is in the 50-100 ton capacity range and has a 5000-10000 cu ft capacity. They are 10 ft wide inside and up to 15 ft or so high inside.
    Intermodal containers can't carry that much and aren't that big. If you want to ship a LOT of big stuff domestically then a boxcar can be cheaper.


    Dave H. Painted side goes up.





    Rastafarr

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    Posted by Rastafarr on Friday, March 22, 2013 8:01 PM
    Interesting. Thanks Dave!
    Stu


    Titus Ore and Timber ca. May 1929
    Sweet mercy is nobility's true badge.





    twcenterprises

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    Posted by twcenterprises on Friday, March 22, 2013 11:04 PM
    Containers are only good for up to *ABOUT* 50,000 pounds of load, and even that's overweight for many trucks that pull them. Many boxcars are good for 200,000 pounds or so, even if the internal dimensions aren't *that* much more. Boxcars are well suited for large rolls of paper (generally rather heavy, a container would be overweight even if only loaded 1/3 full, not to mention dedicated shippers and receivers), and other dense, heavy loads. Containers are better suited for customers who don't have rail service.
    Brad


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    tomikawaTT

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    Posted by tomikawaTT on Saturday, March 23, 2013 12:22 AM
    If both shipper and receiver have rail sidings, it may be more convenient to handle boxcar loads than container loads - especially if the sidings are located in narrow alleys in older industrial/commercial districts. Boxcars load from the side. Containers load from the end.
    In North America, intermodal containers are sized to match highway trailers, and require space and facilities that will accommodate 18 wheelers. In Japan, the standard JNR container would fit on a short flatbed truck, adapted to Japanese roads and urban development but not economical for long hauls. A standard 20 meter container car will carry five, and is designed to be loaded/unloaded with a heavy duty fork lift. Tine clearance is built in.
    Chuck (Modeling Central Japan in September, 1964)






    BRAKIE

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    Posted by BRAKIE on Saturday, March 23, 2013 6:00 AM
    Stu,In layman's term you can get 2 trailer loads in each boxcar..
    Boxcars still carry many items from beer to foodstuff,from scrap rubber to lumber,bagged fertilizer to bagged mulch.They even carry chemicals in 55 gallon drums.
    You may find this interesting.
    NS handled 15,407 boxcar vs. 8,561 intermodal cars for week ending 03/15/13.
    You may also find this site a interesting study. You can also check the other railroads by using the list in the upper left hand corner.
    http://www.railroadpm.org/Performance%20Reports/NS.aspx


    Larry
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    Rastafarr

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    Posted by Rastafarr on Saturday, March 23, 2013 7:21 AM
    BRAKIE
    NS handled 15,407 boxcar vs. 8,561 intermodal cars for week ending 03/15/13.
    Wow. So nowhere near as dead as I thought. Thanks for the link, Larry, I will check it out this afternoon. And thanks to all for educating someone still relatively ignorant on 1:1 railroading!
    Stu


    Titus Ore and Timber ca. May 1929
    Sweet mercy is nobility's true badge.





    dehusman

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    Posted by dehusman on Saturday, March 23, 2013 9:01 AM
    BRAKIE
    NS handled 15,407 boxcar vs. 8,561 intermodal cars for week ending 03/15/13.
    Stu, you have to understand the measure before you make too many assumptions.
    One intermodal "car" on railroads other than the UP could be a 5 well or 5 platform articulated car. So one "intermodal car" could be 10 containers if they are double stacked or 5 boxes for a spine car or single stacked well cars.
    On the UP each platform is considered one "car", so a 5 well stack car is considered 5 cars on the UP. If you study those statistics you will note that the UP has a consistently higher inventory. Part of the reason is that it counts articulated intermodal cars differently. The UP counts things differently because it needs to know the exact loading configuration when the stack trains go across Wyoming to calculate the "blowover" wind speed of the car (how fast a wind gust will blow the railcar over). For two tall empty containers stacked on a car that can be as low as a 55 mph wind.


    Dave H. Painted side goes up.





    BRAKIE

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    Posted by BRAKIE on Saturday, March 23, 2013 10:09 AM
    Dave,None the less those statistics is what the railroads used measuring their performance.I'm sure these are turned in to a governing body,shareholders,board members etc.
    It means very little to us how the railroad counts their intermodal cars the point being the number of boxcars handled out numbers the intermodal..Take the information the railroad gives since its based on their performance and the number of car types handle during a given week.That is a fact that can not be disputed nor should it be..


    Larry
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    NittanyLion

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    Posted by NittanyLion on Saturday, March 23, 2013 10:20 AM
    Here in Alexandria VA, I've determined the existence of five rail served companies:
    the Washington Post's printing plant
    an asphalt plant
    some sort of brick dealer
    a paper recycler
    ethanol transload
    Three of those use boxcars. Probably fairly easy to guess which three.






    dehusman

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    Posted by dehusman on Saturday, March 23, 2013 12:51 PM
    BRAKIE
    It means very little to us how the railroad counts their intermodal cars the point being the number of boxcars handled out numbers the intermodal.
    It is very important to the question Stu posed.
    If I say that the NS handled 15,407 boxcars and 8,561 intermodal cars that gives one impression.
    Lets assume that all of the NS' intermodal equipment is 5 platform cars and half of them are double stacked then those 8561 cars equals 64,200 boxes.
    If I say the NS handled 15,407 carloads in boxcars and 64,200 carloads of intermodal it gives a completely different picture.
    "Handled" and "loaded" are two different things (handled can include empty moves), "cars" and "carloadings" are two different things (a single 5 pack is one car and up to 10 carloadings).
    Not saying anybody is misreporting anything or any figures are wrong. Just have to understand what the measures are saying (or not saying).


    Dave H. Painted side goes up.





    BRAKIE

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    Posted by BRAKIE on Saturday, March 23, 2013 2:00 PM
    Dave,Why complicate the simple facts?
    We could care less if those platforms are empty or loaded since NS didn't state if the cars was loaded or empty the fact remain they handle 8,561 intermodal cars period.Case closed as far as NS is concern.
    We should take those figures as NS and the other railroads presented them as the number of car type handled during a given week..


    Larry
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    dehusman

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    Posted by dehusman on Saturday, March 23, 2013 4:37 PM
    Because Stu asked about the difference in using boxcars and intermodal containers.
    I just restated the statistics in the same units of measure as his question.
    1 intermodal car can equal up to 10 intermodal containers.
    To put it in a different perspective, assuming a boxcar averages 55 ft long and an intermodal car averages 250 ft long, the 15407 boxcars would be 847,385 ft long or 160 miles long. The 8561 intermodal cars would be 2,140,250 ft long or 405 miles long.


    Dave H. Painted side goes up.





    BRAKIE

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    Posted by BRAKIE on Saturday, March 23, 2013 5:01 PM
    And what that have to do with what NS reported? Nothing.
    We don't even know the type of intermodal cars NS reported are..They could be stack or TOFC and yet you are assuming they are double stack? How many are empty well cars being returned to a port? Single stack? Both?
    Let's just go with what NS reported in their weekly report since there is to many unknowns to assume anything...


    Larry
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    Rastafarr

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    Posted by Rastafarr on Saturday, March 23, 2013 6:36 PM
    The point I take out of all this is that boxcars, despite what I thought previously, are still very useful in many situations. Containers make intermodal transport more efficient, true, but they don't work for everyone and probably never will completely replace the good ol' boxie. Good news that!
    Stu


    Titus Ore and Timber ca. May 1929
    Sweet mercy is nobility's true badge.





    NittanyLion

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    Posted by NittanyLion on Saturday, March 23, 2013 7:18 PM
    There's two truths as far as I'm concerned:
    There's the absolute truth. That's X railroad handled Y of cartype Z.
    Then there's localized truth. Railroad X handles Y of cartype Z in an given location.
    Back home in Pittsburgh, I'm not sure I've ever seen a reefer. Ever. Here in VA, the only ones I see are in the Juice Train. But where my brother lives in Ohio, I see blocks of five or six of them in a general freight all the time. Here, boxcars are common and plentiful in the trains passing through town. I assume most of them are full of newsprint and lumber. Back home, they were infrequent and often the big autoparts cars.
    No, the boxcar is not dead and buried once and for all, but...it may effectively appear to be in a given area. What's most important is whether or not they'd appear in your locale (although if you're one of those do anything guys, well then go nuts I guess).






    BRAKIE

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    Posted by BRAKIE on Sunday, March 24, 2013 5:05 AM
    NittanyLion
    No, the boxcar is not dead and buried once and for all, but...it may effectively appear to be in a given area. What's most important is whether or not they'd appear in your locale (although if you're one of those do anything guys, well then go nuts I guess).
    There are those that believe the boxcar is a oddity intoday's railroad business because like you say they live in a place full of IM trains.
    Come to Bucyrus and watch the NS on the Sandusky line and you will see far more boxcars and open hoppers then intermodal.



    Larry
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    dehusman

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    Posted by dehusman on Sunday, March 24, 2013 8:12 AM
    If you want more detailed system level information, look for carloading statistics. It took about 3 minutes to find the information for the NS:
    http://www.nscorp.com/mktgpublic/web...mktg_graph.jsp
    Click on the "Current report : Carloads" link on the top line
    PS: My estimates of the NS handling 64,2000 intermodal boxes was pretty close, the real number was 67,490 (I missed it by 5%).


    Dave H. Painted side goes up.





    BRAKIE

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    Posted by BRAKIE on Sunday, March 24, 2013 8:33 AM
    Dave,Go the next step and check this and get the real picture..Note the drop in trailers.Containers remain around the same level.
    http://www.nscorp.com/mktgpublic/MKTGApp

    Of course this still hasn't anything to do with the the number of car types handled and less it twisted and bent out of shape.


    Larry
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    Bob Schuknecht

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    Posted by Bob Schuknecht on Sunday, March 24, 2013 3:57 PM
    Brakie, the same can be said of much of the CN traffic through Michigan. A lot of it is auto parts, and auto parts are shipped in box cars.
    Many days you may only see two intermodel trains a day, one each direction. Very much different than other parts of the country where intermodel seems to dominate rail traffic.






    dehusman

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    Posted by dehusman on Sunday, March 24, 2013 5:28 PM
    BRAKIE
    Dave,Go the next step and check this and get the real picture..Note the drop in trailers.Containers remain around the same level.
    http://www.nscorp.com/mktgpublic/MKTGApp

    That's a dead link. Go back to my previous post, it has the live link, then you have to navigate to the report you want to view.


    Dave H. Painted side goes up.





    BRAKIE

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    Posted by BRAKIE on Sunday, March 24, 2013 5:46 PM
    Dave,That still doesn't have anything to do with the types of cars handled..NS just reported the number of containters..No big deal since IM cars is used in captive service between point A and point B and point B back to point A...NS 234 hauls stacks from Norfork to Chicago and 233 hauls 'em back to Norfork..Some days 233 hauls more air then containers.


    Larry
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    dti406

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    Posted by dti406 on Monday, March 25, 2013 9:03 AM
    Disregarding box car and container counts. One of the reasons box cars are still used is that containers and trailers weigh out before they cube out. A fifty foot boxcar is good for 77 tons of freight or 154,000 lbs. while a 53' container is still only road legal for 40 tons or 80,000 lbs.
    As an example when I lived in Alaska our company would receive containers or trailers (the only way we could receive freight) of various oil products, case of cans, drums, large containers etc. But we could not load the containers to the roof the best we could have them loaded was about 75% full. By the way the cost to ship a trailer from Seatlle to Anchorage in 1994 was about $4,500.
    One of our competitors did receive bulk oil by Tank Car, Quaker State had a seven compartment car that sat on a team track for a long time while they unloaded the tank car periodically for each type of oil.
    Rick J


    Rule 1: This is my railroad.
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    UP 4-12-2

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    Posted by UP 4-12-2 on Tuesday, April 02, 2013 11:52 AM
    Numerically speaking, compared to the numbersof boxcars in service years ago, the general purpose boxcar is basically dead.
    I owned one of the early 2000's BNSF diesel roster books, and it included a brief discussion that the railroad had gone from owning about 7000 general purpose boxcars down to basically zero within a year or two.
    Many of the boxcars that remain are considered by the rail industry to be "specialty" boxcars. They have a specific cargo they carry and may be captive to a specific industry--like Auto Parts or Newsprint. Trains magazine carried an article a couple years back that basically said most of today's boxcars are specially built for a specific purpose--and if that purpose goes away, they may get scrapped.
    Here in PA I've seen long lines of old yellow 1970's Railbox general purpose boxcars in storage a couple years ago. Since those cars are approaching 40 years of age, the end of their effective lifespan (some cars are not allowed in interchange service between railroads after 40 years of age--tank cars get an extra ten years, I'm assuming due to the complexities of the coatings, etc. inside them) is fast approaching. I have noticed recently that the number of Railbox boxcars in actual service--moving through Enola Yard on a daily basis--is less than it appeared to be just a couple years ago.
    Obviously there are former Railbox cars out there in their second, third, or fourth paint schemes, but those numbers are declining and I suspect that many of them are carrying the paper products as they are often seen in cuts with the known (and still fairly common) Canadian newsprint boxcars and the new TTX yellow hi cube boxcars built specially for paper service.
    So, I see boxcars in the yards--but out on the NS mainline they appear to be greatly outnumbered by containers of one kind or another, either single or double stacked, or trailers.
    John






    BRAKIE

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    Posted by BRAKIE on Tuesday, April 02, 2013 2:19 PM
    UP 4-12-2
    So, I see boxcars in the yards--but out on the NS mainline they appear to be greatly outnumbered by containers of one kind or another, either single or double stacked, or trailers.
    John
    John,I respectfully disagree..I see lots of 50' boxcars on NS and CSX..The boxcar isn't as dead as you and many others think..The number of boxcars reported handle by the railroads will prove that.
    There's no need to second guess,prove or disprove the types of cars the railroads report they handle during a given week..They know and report.
    That's all we need to know.


    Larry
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    UP 4-12-2

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    Posted by UP 4-12-2 on Tuesday, April 02, 2013 5:23 PM
    Larry--
    I did not say the boxcar is dead; I said the general purpose boxcar (of decades past) is dead. There is a difference.
    If one goes to the link provided above and reads the year to date NS carloadings, one would see that intermodal is king, followed by coal, chemicals, finished vehicles and grain.
    The remaining traffic that can possibly move in boxcars is a relative minority. Many of those boxcars are specialty cars built for a specific commodity, and not the general purpose one size fits all and carries just about anything 50' boxcars of decades past.
    What you see in your area is what you see--but the overall numbers say that boxcars are a minority.
    John






    dehusman

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    Posted by dehusman on Tuesday, April 02, 2013 6:06 PM
    Reading these two studies its obvious that boxcars are on the decline and the graph on the ages of cars is a portent of things to come.
    http://www.railsolutionsinc.com/pdf/Investors-Guide-2012-2013-Section1.pdf

    http://www.railserve.com/stats_records/freight_railcar_statistics.html


    The interesting thing is see is the HUGE drop in boxcars in the 1980's as boxcars were phased out of grain service. That was a huge decrease in the need for general service boxcars.


    Dave H. Painted side goes up.





    BRAKIE

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    Posted by BRAKIE on Tuesday, April 02, 2013 7:56 PM
    Dave,I couldn't get those links you posted to work.

    Guys,I guess the railroad count the car style differently then you.That's fine.
    I will go by the weekly performance report on the cars types handle during the reported week since it was done by railroads and they should know.
    I still see hundreds of 50' general service boxcars roll by the house every week..
    BTW..When you live within 300' of a busy NS main line you tend to see what is haul and I will tell you up front there is far more merchandise trains,grain trains and coal drags then intermodal on the Sandusky line.CSX at Fostoria is about even.NS still runs a lot of general freight through Fostoria.


    Larry
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    Rastafarr

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    Posted by Rastafarr on Tuesday, April 02, 2013 8:15 PM
    They're certainly not dead on CN or CP. I see 'em all the time on my drive to work (which phenomenon caused this thread). I have yet to see an entire boxcar train. Mostly they seem to be in mixed freights along with tankers, containers, covered hoppers and the like. None of it's my era, true, but still cool to see rolling behind GEVOs through some spectacular scenery.


    Titus Ore and Timber ca. May 1929
    Sweet mercy is nobility's true badge.





    dehusman

    • Member since
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    • From: Omaha, NE
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    Posted by dehusman on Tuesday, April 02, 2013 8:20 PM
    BRAKIE
    Dave,I couldn't get those links you posted to work.
    Try these
    Link1
    Link 2
    Guys,I guess the railroad count the car style differently then you.That's fine.
    In 1980 there were over 400,000 boxcars in N America.
    Today there are less than 100,000
    That's a significant difference.
    I will go by the weekly performance report on the cars types handle during the reported week since it was done by railroads and they should know.
    I still see hundreds of 50' general service boxcars roll by the house every week..
    BTW..When you live within 300' of a busy NS main line you tend to see what is haul and I will tell you up front there is far more merchandise trains,grain trains and coal drags then intermodal on the Sandusky line.CSX at Fostoria is about even.NS still runs a lot of general freight through Fostoria.
    Really cool, but near where I live maybe 1/3 the trains are bulk, 1/3 are intermodal and the rest auto or manifest. That makes boxcars about 5% of the total cars at the very best.
    Not saying boxcars aren't important or aren't being used, but they are nowhere near as common as they used to be.



    Dave H. Painted side goes up.





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