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Railroad Terminal Strategy RSMA 1967 Soft Cover Railway Systems and Management A
Railroad Terminal Strategy RSMA 1967 Soft Cover Railway Systems and Management Association. Approx 100 pages
The business of transportation depends for its success upon efficiency in the terminals. Why? Because we are in the business of giving place utility to goods and we do not add value to the product until we have moved it from where it is, to where it is needed. Ordinarily, we do not add value to goods in the terminal. On the contrary, we may devalue the product through delay, damage, spoilage or pilferage.
Time in terminal as a percentage of time in transit is a key relationship because equipment utilization, plant utilization, employee utilization and inventory expense are adversely affected by an adverse ratio. One key to successful railroad operations is, therefore, efficiency in the terminals.
One important step toward achieving efficiency is to eliminate terminals entirely. Much more progress has been achieved in this direction than we realize. The modern electronic classification yard has permitted the elimination of many smaller, less efficient yards; the modern container and piggyback facility has eliminated the LCL house and yard, which in turn has permitted the elimination of industry side tracks and facilities no longer needed.
The elimination of yard and terminal activities can be aided by redesigning train service. Large unit trains and bobtailed trains, each for a specific purpose, can achieve remarkable efficiency. We have begun to analyze costs of 5, 10, and 25 car trains designed to run directly from one shipper to one receiver, bypassing all yards in between. In one such analysis, the costs per ton of moving 86' box cars, with a 17 ton payload each, are analyzed in regular train service ( using Form A costs ) compared with the 5 car, 10 car and 25 car trains just referred to. Even the 5 car train appears to have lower costs per ton up to 100 miles than does regular service. This result stems largely from improved utilization of the $40,000 box cars. Much more work needs to be done on this subject before we are satisfied with the soundness of our analysis, but you can see the possibilities that are present in this idea.
Many exciting possibilities exist for the entire spectrum of train consists from the 25,000 ton unit train
to the 5 car train and everywhere in between. Our competitive range is vastly greater than we realize.
So far we have been talking about eliminating terminal activities. Where terminals are a necessary adjunct of our service we must design and utilize these facilities so as to minimize our costs. To achieve these objectives, I would like to discuss the total systems approach in which service, equipment, and pricing arc considered a part of the whole. A good example of the total systems approach on Central is the tri-level automobile business. In the first place this business offered us an opportunity to design a new service from the ground up. We were able to use our operations research and analysis to guide us to an extent not often possible when you are laminating new services onto old.
This total systems planning permitted us to analyze our geographic marketing or distribution areas for the best terminal locations.
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