Shipper-owned railroads

I estimate that there are 319 different corporate entities offering freight service. These firms are classified in two ways in table 15.1. First by size, measured by the number of carloads moved per year. Second, by type of railroad public common-carrier railroads, railroads within port facilities, and shipper-owned railroads. The focus of this chapter is primarily on the public common-carrier railroads because railroads in the other two categories have typically been established for many years, and were not formed by the recent spinning off of branch lines. 

Plan III. Trailers provided by the shippers, owned or leased as he wishes. The shipper delivers loaded trailers to railhead the railroad puts them aboard flat cars, ties them down, moves them to destination, and grounds them and the shipper handles delivery. Rates are based on commodity and quantity moved, or on flat basis. The rates under this plan are obviously much lower than on Plans I and II, because the shipper supplies the trailers and bears the expense of pickup and delivery. Many chemical companies have found that fantastic savings are possible under Plan III. Unfortunately, these rates are being investigated by the Interstate Commerce Commission and are subject to cancellation. Some chemical companies, as well as trade associations in the industry, have appeared at ICC hearings in support of Plan III. We feel that it is an economical and sound proposition, in the best interests of the shipping public, and therefore should be established on a permanent basis. 

In the early 1980s, Don Oris of American President Lines followed Kaye s lead. This shipper purchased its own double-stack railroad cars and did not rely on railroads to furnish equipment for shipping containers from the West Coast. Because it was now involved in both sea and rail transport, American President Lines saw the benefit of modifying the double-stack car design to fit all lift equipment at port and rail terminals. 

Railroads. Until the 1980s, railroads were almost exclusively common carriers that offered their services to the public as transporters of virtually all commodities between all points on their lines, which are privately owned, maintained, and operated. In the 1990s, railroads provide a significant volume of transportation services under privately negotiated contracts with individual shippers, although such contracts were illegal prior to enactment of the... 

Much discussion has evolved about the regrettable condition of the railbeds of our country. Derailments occur daily. Much of the rolling stock is also seriously in need of repair. Essentially all tank cars are owned or leased by shippers hence, can be improved at industry expense. Boxcars, gondolas, etc., are usually owned by the railroads (or Conrail) and a broken axle, hotbox or other failure of any car can cause a pile-up, possibly involving tank equipment or trackside hazards. 

Rail tank cars are rented by the supplier from companies leasing this type of equipment because railroads do not own or furnish equipment to haul liquid commodities such as fats and oils. An advantage of this arrangement is that the shipper of fat products can control the suitability, availability, and utilization of tank cars used for loading of products. 

Plan I. Rail transportation of trailers owned by motor common carriers. Truckers solicit and bill freight at truck rates. The shipper has no direct contact with the railroad. The trucker pays the railroad—either a division or a flat charge per trailer. This plan seems to be in a relative decline, perhaps due to reluctance on the part of the truckers to avail themselves of rail service in competition with straight over-the-road delivery, handled exclusively by the trucks. 

Defines car defects with regard to wheels, axles and boxes, body and couplers. Freight cars must be inspected for defects before a train departs and also when cars are interchanged between railroads. While cars are often owned by shippers and third parties, the requirement for compliance with the Act is with the railroad. A railroad should refuse to accept such a defective car, or just haul it to a place of repair. Three Supreme Court cases going back to 1895 indicate railroad has an absolute duty to inspect cars it receives from another railroad, and hence is liable from harms caused by a defective car (Kenworthy, 1989). 

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