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Management Side
Week of 15 February 2016: I've been workin' on the railroad!

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When I was a young boy, we lived next to the railroad tracks in Troy, Ohio. This was the New York Central main freight line. When I was eight or nine years old, construction was started on I-75 around Troy. One summer we watched as large I-beams, spanning several flatcars, were pulled up in the siding by our home. Cranes came and off-loaded these long beams onto two tractor-trailers. One semi-tractor faced forward, one faced backward, and one of these long I-beams was loaded onto a special dolly mounted to the fifth wheels of these trucks. Then they drove, slowly, from our house three miles to where they were building a new bridge over the new I-75.

I didn't know it, but I was watching one transportation system, the railroad, assist in replacing itself with another, the interstate highway system. In less than twenty-five years from that time, railroads would be struggling for business and manufacturing businesses would begin being totally transformed into large central centers served by trucks.

Freight railroads have had something of a recovery, as they have learned to adapt to a new world. However, railroads could advance a lot further in serving their customers--in our case, pulp and paper mills and their customers.

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The first thing the railroads need to do is to become more transparent to their customers. With bar codes and readers that they are already using, all of the railroads should be giving their customers real-time locations for every rail car, inbound and outbound, in which the customer has a vested interest. This alone would be of great benefit to the customers. It should be an app. Actually, some railroads are already doing this for intermodal freight, but they need to be doing it for everything, all the time, and with pinpoint precision. There is no excuse today for not letting the customers know exactly where their freight is located.

The next leap is a bit tougher. With all the effort being put into building driverless trucks, why not put some effort into driverless, autonomous freight cars on the railroads? If we can build a driverless truck that can maneuver the highways, it seems relatively simple to build a bigger brother, say one with payload capabilities of 100 or 200 tonnes, which could operate on the railroad network by itself. Then, instead of seeing long trains consisting of 100 cars, we would see autonomous cars running down the tracks all the time.

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Programmed to get from Point A to Point B, these supercars would move at their own speed and schedule on the rail network, throwing track switches as they go to self direct on the shortest path between Point A and Point B. Deliveries will be speedier, for rail cars will not have to wait in some marshalling yard to be built into a long train to be pulled for most of the journey. They will just go. Railroad management will turn into a traffic cop role to make sure autonomous supercars do not collide with each other, either when traveling in the same direction or traveling in opposite directions. Yet, in reality, railroads already have this collision avoidance function; they will just have to step up their game to handle thousands of independent cars. At this point, this is just about sensors and programming, folks. We know how to do all of this.

And, at the same time, a large portion of the energy savings of trains will still be left intact. For a large portion of the energy savings involves smooth grades and good track conditions. These conditions have, by necessity, always been superior to highways. And on top of that, trains never interact with civilian traffic.

How about it? Why is this not being done? Railroads need to really move into the 21st century and make a step change in equipment and service.

We would like to learn about your rail experience now. Please take our quiz here.

For safety this week, the more big loads we can put on the rails and keep out of the mix with civilian transportation, the better off we all will be.

Be safe and we will talk next week.

You can own your Nip Impressions Library by ordering "Raising EBITDA ... the lessons of Nip Impressions."


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