US players eye Asciano freight rail business

 
Topic moved from News by bevans on 16 Dec 2014 11:44
  bevans Site Admin

Location: Melbourne, Australia
While Asciano chief executive John Mullen has made great strides with the ports and rail group over the past few years by cutting costs and improving efficiency, the company's intermodal business continues to struggle.
Intermodal haulage volumes, as measured by net tonne kilometres, dropped 2.4 per cent in the first quarter of fiscal 2015 due to falls in freight transported from the west to the east coast. This is partially because rail freight has been losing market share to container shipping, which is cheaper.

But Asciano's bulk haulage division, which moves grains and other commodities, has also been battling falling volumes, which were down 7.7 per cent in the first quarter.
US players eye Asciano freight rail business


Would G&W be a better owner?  I would like someone from SA to opine upon the performance of GWA's intermodal and bulk business.  I am not sure they have a lot of coal?

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  Sulla1 Chief Commissioner

Would G&W be a better owner?  I would like someone from SA to opine upon the performance of GWA's intermodal and bulk business.  I am not sure they have a lot of coal?
"bevans"


Asciano would be worth a lot more to shareholders as a diversified freight company rather than a one trick pony tied to a single commodity currently struggling in global markets. Berkshire Hathaway or another investment fund like Fortress would be likely contenders for a buy in or buy out. The Children's Investment Fund is currently Aurizon's largest investor and previously had attempted to take a controlling interest in CSX.
  YM-Mundrabilla Minister for Railways

Location: Mundrabilla but I'd rather be in Narvik
Would G&W be a better owner? I would like someone from SA to opine upon the performance of GWA's intermodal and bulk business. I am not sure they have a lot of coal?
bevans

If you reckon PN are hard to deal with (I don't mind you) try ...............................................who are a monopoly and act like one. Crying or Very sad
  freightgate Minister for Railways

Location: Albury, New South Wales
PN have held back the development and extension of non coal rail freight. Hey are loosing business on basic intermodal and bulk and hae already killed lcl and petroleum and other types.

A US railroad company would need to really change out the management and set the direction. The recent announcements and annual report do nothing to make me believe they are going anywhere.

I expect coal haulage to now suffer having invested so little in other areas like Bulk and so much in coal which is now in decline.
  Sulla1 Chief Commissioner

PN have held back the development and extension of non coal rail freight. Hey are loosing business on basic intermodal and bulk and hae already killed lcl and petroleum and other types.

A US railroad company would need to really change out the management and set the direction. The recent announcements and annual report do nothing to make me believe they are going anywhere.

I expect coal haulage to now suffer having invested so little in other areas like Bulk and so much in coal which is now in decline.
"freightgate"


Taking on North Americans in senior management has certainly turned Aurizon's focus towards traffic diversification. In its Queensland operations, which seem to be more autonomous, PN has become very hungry for new and varied ways to use its crews and assets - expect some surprises in 2015.
  freightgate Minister for Railways

Location: Albury, New South Wales
We will have to wait and see I guess.

Vincent Graham was a disaster for Australian rail. The network and it's many customers (many now lost to road) have never recovered.
  speedemon08 Mary

Location: I think by now you should have figured it out
Taking on North Americans in senior management has certainly turned Aurizon's focus towards traffic diversification. In its Queensland operations, which seem to be more autonomous, PN has become very hungry for new and varied ways to use its crews and assets - expect some surprises in 2015.
Sulla1


I have been told that PN management went oh crap and started trying to gain back contracts after realising that they had let so many go

We will have to wait and see I guess.

Vincent Graham was a disaster for Australian rail. The network and it's many customers (many now lost to road) have never recovered.
freightgate

Government run railways didnt help either.
  Fireman Dave Chief Commissioner

Location: Shh, I'm hiding
We will have to wait and see I guess.

Vincent Graham was a disaster for Australian rail. The network and it's many customers (many now lost to road) have never recovered.
"freightgate"


What does Vince Graham have to do with PN?
  YM-Mundrabilla Minister for Railways

Location: Mundrabilla but I'd rather be in Narvik
We will have to wait and see I guess.

Vincent Graham was a disaster for Australian rail. The network and it's many customers (many now lost to road) have never recovered.
freightgate

I have to disagree re Vince Graham. Firstly, as has already been said, Vince was not involved with PN. Vince was king of National Rail (NR) which, although mistakes (like the loss of the SCT traffic) were made was a howling success. NR turned the interstate freight task formerly run by the four government railways NSWGR, VR, AN, WAGR (or whatever they were called that day) and coordinated by Railways of Australia from a loss to break even in less than 10 years.
The sad thing about NR was that no sooner had it turned around the previously loss making operation to a more or less break even situation than it was put up for sale at which PN was the successful buyer.
  8077 Chief Train Controller

Location: Crossing the Rubicon
If you reckon PN are hard to deal with (I don't mind you) try ...............................................who are a monopoly and act like one. Crying or Very sad
YM-Mundrabilla


All the big players would be hard to deal with as they are so entrenched in their ways and business and customer requirements have moved on. PN have a track record of downturning rail businesses.  The issue is the think tank art Parramatta.

Tasmanian Railways run down.
Victorian Railways run down.

PN should have retained a much bigger share of the rail business in Victoria but you have Parramatta where the decisions are made.

Whomever decides to buy into PN will need to be prepared to start slashing some of the can't do management at Parramatta.
  nswtrains Chief Commissioner

What has distance got to do with good management. The management of Union Pacific sit in Omaha Nebraska which is further than Melbourne from Parramatta and run the Number 1 freight railroad in the world. But there lies the problem with Australian rail freight. Only major centres on the seaboard unlike the USA with lots towns spread throughout country. For instance, Omaha is as near to the centre of the contiguous states of the USA that you can get but has huge freight yards, lot of small industry and a fairly large population.  Probably the nearest example here is Alice Springs. What can you say about that town? Biggest industries are tourists and the retailing of grog.
  michaelgreenhill Administrator That's Numberwang!

Location: Melbourne
What has distance got to do with good management.
nswtrains
Nobody is saying it does.

Parramatta, from what I infer, is where PN is headquartered, and thus where all the major decision making happens. The issue isn't the location, but the people running the show - "Parramatta" is just a shorthand.
  michaelgreenhill Administrator That's Numberwang!

Location: Melbourne
Tasmanian Railways run down.
8077
In terms of percentage of booked-in kilometers of track, Tasmania would now be in better shape than Victoria having had several hundred millions of dollars spent on major infrastructure upgrades, including new locos, rollingstock and track rehabilitation. From what I saw in January the entire line from Western Junction to Brighton has been upgraded.
  Z1NorthernProgress2110 Chief Commissioner

Location: Burnie, Tasmania
From what I saw in January the entire line from Western Junction to Brighton has been upgraded.
michaelgreenhill

Not all, just in certain spots. Also In the North West as well.
  nswtrains Chief Commissioner

Nobody is saying it does.

Parramatta, from what I infer, is where PN is headquartered, and thus where all the major decision making happens. The issue isn't the location, but the people running the show - "Parramatta" is just a shorthand.
michaelgreenhill

Well I am agreeing with you in a round about way. But the bottom line is; "does PN make enough money to keep shareholders happy"? If they are I am sure PN doesn't give a hoot what a bunch of gunzels think.
  michaelgreenhill Administrator That's Numberwang!

Location: Melbourne
Shareholders can be dumb. All they see is short-term gain (price hikes, share prices goes up), and not the big/long term picture (customers leave, share prices goes down).
  8077 Chief Train Controller

Location: Crossing the Rubicon
Nobody is saying it does.

Parramatta, from what I infer, is where PN is headquartered, and thus where all the major decision making happens. The issue isn't the location, but the people running the show - "Parramatta" is just a shorthand.
michaelgreenhill


A check on the Internet shows Asciano is headquartered in Melbourne.  Pacific National assumed the Parramatta offices of freightcorp.

The issue is not the shorthanded PN management it is really there short on experience in running a competitive full service freight business.
  nswtrains Chief Commissioner

A check on the Internet shows Asciano is headquartered in Melbourne.  Pacific National assumed the Parramatta offices of freightcorp.

The issue is not the shorthanded PN management it is really there short on experience in running a competitive full service freight business.
8077
Speaking to a PN employee today and for what it is worth the talk around is that PN want to sell all of the freight rail business except the coal haulage business. And yes, some US railroad is an interested purchaser. Apparently they were interested from the start but could not get their heads around the above rail only deal and wanted everything. Now they appear to have had a change of heart. I understand UP was the former interested party but who knows? Before too many people jump up and down this is only scuttlebutt.
  seb2351 Chief Commissioner

Location: Sydney
Speaking to a PN employee today and for what it is worth the talk around is that PN want to sell all of the freight rail business except the coal haulage business. And yes, some US railroad is an interested purchaser. Apparently they were interested from the start but could not get their heads around the above rail only deal and wanted everything. Now they appear to have had a change of heart. I understand UP was the former interested party but who knows? Before too many people jump up and down this is only scuttlebutt.
nswtrains
Asciano has wanted to sell off bits of PN for years: Indeed that is why they divided in Bulk, Coal and Intermodal to make it easier.

Then, they decided to amalgamate them all back together, making any sale involving the split of the business more difficult. Rumours of spinning of section of PN have been around since 2003.
  Typhon Assistant Commissioner

Location: I'm that freight train tearing through the sky in the clouds.
Speaking to a PN employee today and for what it is worth the talk around is that PN want to sell all of the freight rail business except the coal haulage business. And yes, some US railroad is an interested purchaser. Apparently they were interested from the start but could not get their heads around the above rail only deal and wanted everything. Now they appear to have had a change of heart. I understand UP was the former interested party but who knows? Before too many people jump up and down this is only scuttlebutt.
nswtrains

Everything's for sale at the right price.
  RTT_Rules Oliver Bullied, CME

Location: Dubai UAE
In terms of percentage of booked-in kilometers of track, Tasmania would now be in better shape than Victoria having had several hundred millions of dollars spent on major infrastructure upgrades, including new locos, rollingstock and track rehabilitation. From what I saw in January the entire line from Western Junction to Brighton has been upgraded.
michaelgreenhill
Tassie has about 650km or so of active track. You would hope that after dumping a few hundred million it was in reasonable shape. I think the only marginal section is the Bell Bay line with on again off again traffic since the 90's. The short Melba Flats extension is probably also moth balled pending an outcome from Mt Lyell Mine.

The challenge for Tasmania is to sustain this infrastructure. With revenues at a guess of $40-50m if there is a good profit margin doesn't leave much left over to pay for expensive rail bits and pieces. The previous Tas govt is on record saying that this is a one off major upgrade injection.
  craigd Deputy Commissioner

Location: A Thinktank near you
In SA, the only coal moved by rail is already with PN who run coal trains between Leigh Creek and Pt Augusta power station. They advertised a couple of jobs for that last year.

Remember too that PN has built a lot of it's business particularly on the east coast and especially in NSW (and double-especially in the NSW export coal business) on the back of acquiring former state monopoly rail freight businesses such at Freightcorp. Much like GWA picking up freight in SA after ANR was split up.

A large part of the problems have nothing to do with PN btw - they're due to entrenched government dis-interest in rail transport and legislative frameworks that increasingly disadvantage rail transport compared to road transport. That will take much longer to resolve.

Craig.
  freightgate Minister for Railways

Location: Albury, New South Wales
Perhaps having a large us based company running a large intermodal and bulk business might be what is required to shake this country into the 21st century ?

Do you believe PN actually knows how to influence government policy ?
  seb2351 Chief Commissioner

Location: Sydney
Perhaps having a large us based company running a large intermodal and bulk business might be what is required to shake this country into the 21st century ?

Do you believe PN actually knows how to influence government policy ?
freightgate
Given that they are leading a number of business lobby groups, they regularly release media reports into Government interactions and so on it is clear that they do.

But, while you raise it yes, lets bring in the US style of running railways here. It is such a large success as the tracks groan with stressed assets, safety issues galore run rampant in a system that is driven by profit and the ability to run short haul simply does not exist in Australia. The US system and the Australian systems are apples and oranges.

Would you like the next major derailment to wipe out Melbourne or Sydney under the brilliant US style of operations?

Have a look of the population and industry centres in the US and overlay it on the Australian map. See the difference?

But sorry to disturb you from your armchair, please allow me to reload Train Simulator and SimCity, as they are clearly your reference tools so that you can continue to lecture those in the real world how it should be done.
  freightgate Minister for Railways

Location: Albury, New South Wales
This is the same old tired argument we have been listening to for years and one the road transport lobby loves.

Because you can't think or know of a way to do it I obviously cannot be done.

How much more freight is on rail in the USA compared to Australia ?

The Americans would not have a clue right ?  What would rail companies in the USA know about running trains. Hard to believe.

Until peoples perceptions on what can be achieved and in many respects has already been achieved in this country rail will struggle.

SCT is a great example of how privatised government rail enterprises rising out of the ashes could not achieve or did not know how to achieve what SCT has already made a great success.

The difference being SCT do not have management who cannot think outside the coal
Box.

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