Overview of the US Class I Railroad Industry General View: Historically Treated as a Natural...
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Overview of the US Class I Railroad Industry General View: Historically Treated as a Natural Monopoly Increasing Returns to Density Constant Returns to Scale Industry Behavior is Inconsistent with Literature: Mergers and Growth Heavily Concentrated Industry Concern for Natural Monopoly Congressional Interest: Frequent Shipper Complaints Calls for Reregulation Lack of Revenue Adequacy Introduction
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Transcript of Overview of the US Class I Railroad Industry General View: Historically Treated as a Natural...
Overview of the US Class I Railroad Industry
General View:Historically Treated as a Natural MonopolyIncreasing Returns to DensityConstant Returns to Scale
Industry Behavior is Inconsistent with Literature:Mergers and Growth Heavily Concentrated IndustryConcern for Natural Monopoly
Congressional Interest:Frequent Shipper ComplaintsCalls for ReregulationLack of Revenue Adequacy
Introduction
Overview of the US Class I Railroad Industry
DeregulationLabor RelationsNumber of Rail CarriersIndustry Size
Revenue EarnedTon-Miles ProducedMiles of Road Number of Employees
Average CarriersProductivityUnit Costs
Change in the Railroad Industry: 1976-2008
Overview of the US Class I Railroad Industry
Number of Industry Industry Industry Miles ofYear Carriers Ton-Miles** Revenue* Employees Road1976 52 794,059 18,536,482 482,882
185,395 1977 52 826,292 20,090,482 482,731
182,380 1978 41 858,105 21,721,332 471,519
175,912 1979 41 913,669 25,219,115 482,789
169,927 1980 40 918,621 28,102,946 458,994
164,822 1981 38 910,169 30,898,610 436,397
162,160 1982 33 797,759 27,503,503 378,906
159,123 1983 31 828,275 26,729,392 322,030
155,879 1984 28 921,542 29,453,446 323,030
151,998 1985 26 876,984 27,586,441 302,000
145,764 1986 22 867,722 26,204,122 276,000
140,061 1987 16 943,747 26,622,482 249,000
132,220 1988 16 996,182 27,934,285 236,000
127,555 1989 14 1,013,841 27,955,959 228,000
124,236 1990 14 1,033,969 28,369,803 216,000
119,7581991 13 1,038,875 27,845,206 206,000
116,626
•Thousands of dollars, ** Millions of ton-miles•Source: AAR Railroad Facts, Various Years
Table 1: Industry Overview, Class I Railroads, 1976-2008
Overview of the US Class I Railroad Industry
Number of Industry Industry Industry Miles ofYear Carriers Ton-Miles** Revenue* Employees Road1992 12 1,066,781 28,348,895 197,000
113,056 1993 12 1,109,309 28,824,852 193,000
110,425 1994 12 1,200,701 30,808,977 190,000
109,332 1995 11 1,305,688 32,279,491 188,000
108,264 1996 10 1,346,463 32,692,638 182,000
105,779 1997 9 1,348,926 33,118,031 178,000
102,128 1998 9 1,376,802 33,150,891 178,000
100,570 1999 8 1,433,461 33,521,176 178,000
99,430 2000 7 1,465,960 34,102,141 168,352
99,250 2001 7 1,473,957 34,204,537 162,152
97,631 2002 7 1,507,011 35,327,265 157,290
99,943 2003 7 1,551,438 35,744,236 154,652
98,944 2004 7 1,662,598 40,517,155 157,496
97,334 2005 7 1,696,424 46,118,002 162,401
95,830 2006 7 1,771,897 52,151,588 166,179
94,614 2007 7 1,770,545 54,604,402 167,216
94,440 2008 7 1,767,236 61,242,606 164,439
94,209
* Thousands of dollars, ** Millions of ton-miles,Source: AAR Railroad Facts, Various Years
Table 1: Industry Overview, Class I Railroads, 1976-2008
Overview of the US Class I Railroad Industry
Figure 1Industry Ton-Miles, Class I Railroads: 1976-2008
1975 1980 1985 1990 1995 2000 2005 20100
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
1,800,000
2,000,000
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
1975 1980 1985 1990 1995 2000 2005 20100
10,000,000
20,000,000
30,000,000
40,000,000
50,000,000
60,000,000
70,000,000
Figure 2Industry Revenue, Class I Railroads: 1976-2008
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
Figure 3Number of Employees, Class I Railroads: 1970-2008
1975 1980 1985 1990 1995 2000 2005 2010100,000
200,000
300,000
400,000
500,000
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
Figure 4Miles of Road, Class I Railroads: 1970-2008
1975 1980 1985 1990 1995 2000 2005 2010 80,000
100,000
120,000
140,000
160,000
180,000
200,000
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
Number Ton-Miles Revenue Employees Route MilesYear of RRs per RR* per RR** per RR per RR1976 52 15,270 356,471 9,286 3,5651977 52 15,890 386,355 9,283 3,5071978 41 20,929 529,789 11,500 4,2911979 41 22,285 615,100 11,775 4,1451980 40 22,966 702,574 11,475 4,1211981 38 23,952 813,121 11,484 4,2671982 33 24,175 833,439 11,482 4,8221983 31 26,719 862,238 10,388 5,0281984 28 32,912 1,051,909 11,537 5,4291985 26 33,730 1,061,017 11,615 5,6061986 22 39,442 1,191,096 12,545 6,3661987 16 58,984 1,663,905 15,563 8,2641988 16 62,261 1,745,893 14,750 7,9721989 14 72,417 1,996,854 16,286 8,8741990 14 73,855 2,026,415 15,429 8,5541991 13 79,913 2,141,939 15,846 8,971
*Figures in Millions, **Figures in ThousandsSource: AAR Railroad Facts, Various Years
Table 2: Average Size of Class I Railroads, 1976-2008
Overview of the US Class I Railroad Industry
Number Ton-Miles Revenue Employees Route MilesYear of RRs per RR* per RR** per RR per RR1992 12 88,898 2,362,408 16,417 9,4211993 12 92,442 2,402,071 16,083 9,2021994 12 100,058 2,567,415 15,833 9,1111995 11 118,699 2,934,499 17,091 9,8421996 10 134,646 3,269,264 18,200 10,5781997 9 149,881 3,679,781 19,778 11,3481998 9 152,978 3,683,432 19,778 11,1741999 8 179,183 4,190,147 22,250 12,4292000 7 209,423 4,871,734 24,050 14,1792001 7 210,565 4,886,362 23,165 13,9472002 7 215,287 5,046,752 22,470 14,2782003 7 221,634 5,106,319 22,093 14,1352004 7 237,514 5,788,165 22,499 13,9052005 7 242,346 6,588,286 23,200 13,6902006 7 253,128 7,450,227 23,740 13,5162007 7 252,935 7,800,629 23,888 13,4912008 7 252,462 8,748,944 23,491 13,458
*Figures in Millions, **Figures in ThousandsSource: AAR Railroad Facts, Various Years
Table 2: Average Size of Class I Railroads, 1976-2008
Overview of the US Class I Railroad Industry
Figure 5Ton-Miles per Railroad, Class I Railroads: 1976-2008
1975 1980 1985 1990 1995 2000 2005 20100
50,000
100,000
150,000
200,000
250,000
300,000
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
Figure 6Revenue per Railroad, Class I Railroads: 1976-2008
1975 1980 1985 1990 1995 2000 2005 20100
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
Figure 7Employees Per Railroad , Class I Railroads: 1976-2008
1975 1980 1985 1990 1995 2000 2005 2010 -
5,000
10,000
15,000
20,000
25,000
30,000
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
Figure 8Miles of Road Per Railroad, Class I Railroads: 1976-2008
1975 1980 1985 1990 1995 2000 2005 2010 -
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
Revenue Revenue per Ton-Miles per Revenue per Ton-Miles perYear per Ton-Mile Employee Employee Mile of Road Mile of Road1976 2.33 38,387 1,644,416 99,984 4,283,0661977 2.43 41,618 1,711,703 110,157 4,530,6061978 2.53 46,067 1,819,874 123,478 4,878,0361979 2.76 52,236 1,892,481 148,411 5,376,8321980 3.06 61,227 2,001,379 170,505 5,573,4131981 3.39 70,804 2,085,644 190,544 5,612,7841982 3.45 72,587 2,105,427 172,844 5,013,4741983 3.23 83,003 2,572,043 171,475 5,313,5771984 3.20 91,179 2,852,806 193,775 6,062,8561985 3.15 91,346 2,903,921 189,254 6,016,4651986 3.02 94,942 3,143,920 187,091 6,195,3151987 2.82 106,918 3,790,149 201,350 7,137,7021988 2.80 118,366 4,221,110 218,998 7,809,8231989 2.76 122,614 4,446,671 225,023 8,160,6061990 2.74 131,342 4,786,894 236,893 8,633,8201991 2.68 135,171 5,043,083 238,756 8,907,748
*Figures in Millions, **Figures in ThousandsSource: AAR Railroad Facts, Various Years
Table 3: Productivity Measures, Class I Railroads, 1976-2008
Overview of the US Class I Railroad Industry
Revenue Revenue per Ton-Miles per Revenue per Ton-Miles perYear per Ton-Mile Employee Employee Mile of Road Mile of Road1992 2.66 143,903 5,415,132 250,751 9,435,8641993 2.60 149,352 5,747,715 261,036 10,045,8141994 2.57 162,153 6,319,479 281,793 10,982,1551995 2.47 171,699 6,945,149 298,155 12,060,2231996 2.43 179,630 7,398,149 309,065 12,729,0221997 2.46 186,056 7,578,235 324,280 13,208,1881998 2.41 186,241 7,734,842 329,630 13,689,9851999 2.34 188,321 8,053,154 337,133 14,416,7892000 2.33 202,565 8,707,709 343,598 14,770,3802001 2.32 210,941 9,089,969 350,345 15,097,2202002 2.34 224,600 9,581,098 353,474 15,078,7042003 2.30 231,127 10,031,798 361,257 15,679,9572004 2.44 257,258 10,556,447 416,269 17,081,3712005 2.72 283,976 10,445,899 481,248 17,702,4372006 2.94 313,828 10,662,578 551,204 18,727,6352007 3.08 326,550 10,588,372 578,191 18,747,8322008 3.47 372,434 10,747,062 650,072 18,758,677 *Figures in Millions, **Figures in ThousandsSource: AAR Railroad Facts, Various Years
Table 3: Productivity Measures, Class I Railroads, 1976-2008
Overview of the US Class I Railroad Industry
Figure 9Revenue per Ton-Mile, Class I Railroads: 1976-2008
1975 1980 1985 1990 1995 2000 2005 2010 -
0.005
0.010
0.015
0.020
0.025
0.030
0.035
0.040
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
Figure 10Revenue per Employee, Class I Railroads: 1976-2008
1975 1980 1985 1990 1995 2000 2005 2010 -
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
Figure 11Ton-Miles per Employee, Class I Railroads: 1976-2008
1975 1980 1985 1990 1995 2000 2005 2010 -
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
Figure 12Revenue per Mile of Road, Class I Railroads: 1976-2008
1975 1980 1985 1990 1995 2000 2005 2010 -
100,000
200,000
300,000
400,000
500,000
600,000
700,000
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
Figure 13Ton-Miles per Mile of Road, Class I Railroads: 1976-2008
1975 1980 1985 1990 1995 2000 2005 2010 -
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
16,000,000
18,000,000
20,000,000
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
Operating Revenue Adj Rev* Expense Adj Exp*Year Ratio Per Ton-Mile Per Ton-Mile Per Ton-Mile Per Ton-Mile1976 96.5 2.33 4.7 2.25 4.51977 97.2 2.43 4.6 2.36 4.41978 96.9 2.53 4.4 2.45 4.3 1979 95.1 2.76 4.2 2.63 4.0 1980 93.8 3.06 4.0 2.87 3.8 1981 92.5 3.39 3.9 3.14 3.6 1982 96.3 3.45 3.7 3.32 3.5 1983 90.2 3.23 3.4 2.91 3.1 1984 87.6 3.20 3.2 2.80 2.8 1985 91.4 3.15 3.1 2.88 2.9 1986 95.0 3.02 3.0 2.87 2.8 1987 89.7 2.82 2.8 2.53 2.5 1988 88.8 2.80 2.7 2.49 2.4 1989 89.6 2.76 2.6 2.47 2.3 1990 86.9 2.74 2.6 2.38 2.2 1991 100.8 2.68 2.5 2.70 2.5
* Adjusted to 1984 dollars via RR PPI Source: AAR Railroad Facts, Various Years
Table 3: Unit Costs and Revenues, Class I Railroads, 1976-2008
Overview of the US Class I Railroad Industry
Table 3: Productivity Measures, Class I Railroads, 1976-2008Operating Revenue Adj Rev* Expense Adj Exp*
Year Ratio Per Ton-Mile Per Ton-Mile Per Ton-Mile Per Ton-Mile1992 89.3 2.66 2.4 2.37 2.2 1993 85.1 2.60 2.3 2.21 2.0 1994 82.8 2.57 2.3 2.12 1.9 1995 86.4 2.47 2.2 2.14 1.9 1996 80.5 2.43 2.2 1.96 1.8 1997 82.4 2.46 2.2 2.02 1.8 1998 84.2 2.41 2.1 2.03 1.8 1999 83.6 2.34 2.1 1.95 1.7 2000 86.3 2.33 2.0 2.01 1.8 2001 85.3 2.32 2.0 1.98 1.7 2002 83.8 2.34 2.0 1.96 1.7 2003 88.0 2.30 1.9 2.03 1.7 2004 86.6 2.44 1.9 2.11 1.7 2005 82.1 2.72 1.9 2.23 1.6 2006 78.6 2.94 1.9 2.31 1.5 2007 78.3 3.08 2.0 2.41 1.5 2008 77.3 3.47 2.0 2.68 1.5
* Adjusted to 1984 dollars via RR PPI Source: AAR Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
Figure 14Operating Ratio, Class I Railroads: 1976-2008
1975 1980 1985 1990 1995 2000 2005 201060.0
70.0
80.0
90.0
100.0
110.0
Source: AAR, Railroad Facts, Various Years
Overview of the US Class I Railroad Industry
1975 1980 1985 1990 1995 2000 2005 2010Adjusted to 1984 dollars via RR PPISource: AAR, Railroad Facts, Various Years
Figure 15Adjusted Revenue per Ton-Mile, Class I Railroads: 1976-2008
(Cents)
5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
--
Overview of the US Class I Railroad Industry
1975 1980 1985 1990 1995 2000 2005 2010
Figure 16Adjusted Expenses per Ton-Mile, Class I Railroads: 1976-2008
(Cents)
Adjusted to 1984 dollars via RR PPISource: AAR, Railroad Facts, Various Years
5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
--
