CP to Buy KCS

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Doktor No
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Re: CP to Buy KCS

Unread post by Doktor No »

Put in a bridge, diamond (doubt that) or a balloon track at Porter to the Lake sub and ya get into Chitown via a much handier connection. Does CP still own a piece of the IHB? BUY IT! THE WHOLE darn THING!
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Re: CP to Buy KCS

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ns8401 wrote:
Sun Mar 21, 2021 7:07 pm
UP/CN/Ferromex? UP owns 26% of Ferromex already and the conflicts seem limited. There’s your second multinational road.

Even taking CN out of that hypothetical the UP could just acquire the rest of Ferromex and be competitive with the CPKC. BNSF would go nuts over it though.
That's what I'm saying, it would be hard for another merger to happen without someone losing their sh** over it.

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Re: CP to Buy KCS

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Chip wrote:
Sun Mar 21, 2021 9:09 pm
ns8401 wrote:
Sun Mar 21, 2021 7:07 pm
UP/CN/Ferromex? UP owns 26% of Ferromex already and the conflicts seem limited. There’s your second multinational road.

Even taking CN out of that hypothetical the UP could just acquire the rest of Ferromex and be competitive with the CPKC. BNSF would go nuts over it though.
That's what I'm saying, it would be hard for another merger to happen without someone losing their sh** over it.
That's why the only "fair" mergers remaining is a pair of east/west hookups. Anything involving the CN or CP at this point with one of the eastern or western carriers will ALWAYS result in an imbalance the STB will not like.

Now, I could see, for instance, BNSF/NS/CN and UP/CSX/CP or something of that sort, for a true two-railroad system. But operationally, it will not gain much beyond what CN, CPKC, NS-BNSF and UP-CSX would do already.

The only real reason to do east/west mergers is just like this north-south merger: it is end-to-end and extends the line haul over a single railroad. Lots of traffic doesn't move by rail simply because somebody gets shorthauled and doesn't wanna play ball. Eliminate the artificial east/west divide and poof, no longer a problem.

There are very few operational advantages to be had because they're end-to-end. The personnel reduction would probably be on the order of perhaps 10%, upper management.
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Re: CP to Buy KCS

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Saturnalia,

You make very good points that I have also considered. Right now, if a rail customer wants to ship product from California to say, Ohio he has to pay 2 bills, in my example, one for BNSF and one for NS. With a two railroad system, that same shipper now pays one bill, so I have always thought there could be great benefit to railroad customers with a final round of mergers, as well as the great potential to gain more traffic.

Also, the argument for a decrease in competition with these mergers simply does not add up in my mind. You still would have 2 railroad options in the West and 2 railroad options in the East, only difference would be (if one more round takes place), these 2 options would span coast to coast, as well as into Canada and Mexico.

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Re: CP to Buy KCS

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I wonder what paint scheme they'll apply to the engines and how long before they do heritage units :wink:
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Re: CP to Buy KCS

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AARR, I just saw the cart go down the road, don't see the horse yet :P

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Re: CP to Buy KCS

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:lol:
DaveO wrote:
Mon Mar 22, 2021 8:24 am
AARR, I just saw the cart go down the road, don't see the horse yet :P
PatC created a monster, 'cause nobody wants to see Don Simon no more they want AARR I'm chopped liver, well if you want AARR this is what I'll give ya, bad humor mixed with irrelevant info that'll make you roll your eyes quicker than a ~Z~ banhammer...

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Re: CP to Buy KCS

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Honestly what CPKC will become cannot be competed by any other railroad even if more mergers come together. CN cant merge with Ferromex, the western carriers can’t connect to the east and Mexico unless they do an ungodly combination that the STB would never pass, even any east-west merger alone still won’t link all 3 major counties and their cities like CPKC - in a way they have just produced the ultimate “end game” of a network that will forever change the North American rail network. Im curious if the other Class Is will buckle down and work on their own networks to increase their traffic densities to utilize the CPKC network to ship cars involving Mexico and Canada because the Class Is can’t expand much further than they are now - CSX was the final chapter for them tapping into a new network - still can’t compete with CPKC because of their link to Mexico. All the other Class Is have access to all markets unless they start buying up Class 2s and taking back their former operations.

Now in regards to the PM across Michigan as discussed, this is a huge opportunity for CSX to make a big payout selling Plymouth to Porter as the missing link for the CPKC’s new super network. It’s very painfully clear that CSX has no long term plans to utilize it as they move everything from Toledo to Detroit and is still a respectively busy section up here - including all their traffic for LSRC. CPKC wouldn’t have issues between Plymouth and the tunnel with CSX’s current volumes (busy but nothing like it was when CP was up here in the 90s) and they stopped devesting the Detroit Sub and have been spending a huge amount on upgrades from Plymouth to Porter on a line that’s just locals. They would get better options for Oak Yard as well which would be a booming hub for automotive parts coming from Mexico for Jeep and FCA. Just my two cents, I guess we will see what happens. Seems like this is a Class I end game to me.
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Re: CP to Buy KCS

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Racer wrote:
Mon Mar 22, 2021 10:44 pm
...even any east-west merger alone still won’t link all 3 major counties and their cities like CPKC - in a way they have just produced the ultimate “end game” of a network that will forever change the North American rail network.
I don't think it's quite as strong as you're thinking. The Mexican traffic is big, sure, but it's still only a fraction of the volumes most of the big carriers see from other parts of their networks. CP still doesn't do anything in the States outside of their narrow centralized corridor, so the Big Four will still get plenty of their own Mexican traffic.

If KCS-CP was that transformative, it would have happened 20 years ago.
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Re: CP to Buy KCS

Unread post by ns8401 »

Saturnalia wrote:
Mon Mar 22, 2021 11:41 pm
Racer wrote:
Mon Mar 22, 2021 10:44 pm
...even any east-west merger alone still won’t link all 3 major counties and their cities like CPKC - in a way they have just produced the ultimate “end game” of a network that will forever change the North American rail network.
I don't think it's quite as strong as you're thinking. The Mexican traffic is big, sure, but it's still only a fraction of the volumes most of the big carriers see from other parts of their networks. CP still doesn't do anything in the States outside of their narrow centralized corridor, so the Big Four will still get plenty of their own Mexican traffic.

If KCS-CP was that transformative, it would have happened 20 years ago.
The international traffic south of the border wasn’t nearly as big as it is now 20 years ago. KCSM was still TFM at that time as well. The ingredients simply weren’t there for this sort of thing at that time.
Racer wrote:
Mon Mar 22, 2021 10:44 pm
Honestly what CPKC will become cannot be competed by any other railroad even if more mergers come together. CN cant merge with Ferromex, the western carriers can’t connect to the east and Mexico unless they do an ungodly combination that the STB would never pass, even any east-west merger alone still won’t link all 3 major counties and their cities like CPKC - in a way they have just produced the ultimate “end game” of a network that will forever change the North American rail network. Im curious if the other Class Is will buckle down and work on their own networks to increase their traffic densities to utilize the CPKC network to ship cars involving Mexico and Canada because the Class Is can’t expand much further than they are now - CSX was the final chapter for them tapping into a new network - still can’t compete with CPKC because of their link to Mexico. All the other Class Is have access to all markets unless they start buying up Class 2s and taking back their former operations.

Now in regards to the PM across Michigan as discussed, this is a huge opportunity for CSX to make a big payout selling Plymouth to Porter as the missing link for the CPKC’s new super network. It’s very painfully clear that CSX has no long term plans to utilize it as they move everything from Toledo to Detroit and is still a respectively busy section up here - including all their traffic for LSRC. CPKC wouldn’t have issues between Plymouth and the tunnel with CSX’s current volumes (busy but nothing like it was when CP was up here in the 90s) and they stopped devesting the Detroit Sub and have been spending a huge amount on upgrades from Plymouth to Porter on a line that’s just locals. They would get better options for Oak Yard as well which would be a booming hub for automotive parts coming from Mexico for Jeep and FCA. Just my two cents, I guess we will see what happens. Seems like this is a Class I end game to me.
There will be a round of mega mergers to come. They’ll likely be East-West. The traffic from
the west coast is nothing to sneeze at. UP will probably end up with Ferromex sooner or later. The only question is which eastern road they merge with. As for buying the PM... it’s far cheaper to do haulage rights over another railroad than buy a line and maintain the infrastructure and all the assorted local crew bases that come with it. They’ll stick to the NS routing for the foreseeable future. If they paid to redouble track the Wabash they would come out ahead and it would move efficiently. I can’t see there being that many more than a handful of intermodal and manifest trains coming all the way through anyways.
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Re: CP to Buy KCS

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I see what your saying 8401, but the big speculation question is if NS wants to handle it? Or perhaps CSX will be more flexible to increased traffic and more train slots than NS is currently allowing? Once west of Plymouth, it’s pretty much open space for increased train traffic with 4-6 CSX trains to dodge at best vs 20 years ago when CSX was running 10-12 a day. I still find all the investments from Plymouth to Porter a real head scratcher as I’m sure once West Olive eventually winds down their coal operations there is nothing west of Plymouth worth while for CSX unless it was regained as a through route for Canada-Chicago/west. All the auto traffic in Flint and Wixom is long gone was fed via GR, although LSRC is gaining some ground in traffic that was lost, it’s all for Toledo now and nothing close to what it once was.
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Re: CP to Buy KCS

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This is occurring against the backdrop that some in Congress are wondering out loud about where the anti-monopoly laws have gone.
Not going to be a slam dunk for this to be approved.

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Re: CP to Buy KCS

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The CP's Chicago-KC route via Savanna-Clinton-Davenport-Ottumwa and St. Paul to Savanna (south of La Crosse) is mostly single track TWC territory (with some CTC) and via former MILW/CRIP trackage which went to Soo Line. Seems like some upgrades will be needed if volumes to KC increase.

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Re: CP to Buy KCS

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Makes you wonder how strategic it was that CP purchased the remaining percentage of the Detroit-Windsor MC rail tunnel last year....

Who owns the connecting trackage between CP Lou and CP Michigan Ave in Dearborn? Conrail, or CP?

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Re: CP to Buy KCS

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GP30M4216 wrote:
Tue Mar 23, 2021 11:45 am
Makes you wonder how strategic it was that CP purchased the remaining percentage of the Detroit-Windsor MC rail tunnel last year....

Who owns the connecting trackage between CP Lou and CP Michigan Ave in Dearborn? Conrail, or CP?
Strategic for the city of Detroit maybe, they need the cash.

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Re: CP to Buy KCS

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Chip wrote:
Tue Mar 23, 2021 11:49 am
GP30M4216 wrote:
Tue Mar 23, 2021 11:45 am
Makes you wonder how strategic it was that CP purchased the remaining percentage of the Detroit-Windsor MC rail tunnel last year....

Who owns the connecting trackage between CP Lou and CP Michigan Ave in Dearborn? Conrail, or CP?
Strategic for the city of Detroit maybe, they need the cash.
Are you thinking of the Detroit-Windsor auto tunnel? The city of Detroit didn’t, and I don’t believe ever had, an interest in the rail tunnel. CP acquired the remaining percentage from the Ontario Pension Fund as noted in the press release below.

https://www.cpr.ca/en/media/cp-to-acqui ... ail-tunnel

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Re: CP to Buy KCS

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GP30M4216 wrote:
Tue Mar 23, 2021 11:45 am
Who owns the connecting trackage between CP Lou and CP Michigan Ave in Dearborn? Conrail, or CP?
The signs on the Southern Ave crossing say contact Conrail.

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Re: CP to Buy KCS

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GP30M4216 wrote:
Tue Mar 23, 2021 11:45 am
Makes you wonder how strategic it was that CP purchased the remaining percentage of the Detroit-Windsor MC rail tunnel last year....

Who owns the connecting trackage between CP Lou and CP Michigan Ave in Dearborn? Conrail, or CP?
That portion is Conrail Shared Assets.
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Re: CP to Buy KCS

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Does anyone think the merged company might bring back cabooses
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Re: CP to Buy KCS

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AARR wrote:
Tue Mar 23, 2021 4:57 pm
Does anyone think the merged company might bring back cabooses
Why would they do that?
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