It was simply inevitable that KCS would be "in play". However, most of the "play" was coming from one "private equity" outfit or the other. All too many businesses have simply been "wrecked with the carcass left to rot" by those. So it's gratifying to see a play coming from within the railroad industry.
But there will be nothing open and shut with this acquisition; approval must be attained from three sovereign regulatory agencies. Putting that aside, I guarantee Warren (BNSF) will not sit there like a bump on the log. BNSF will surely be seeking access into Mexico as well (UP is already there with 25% of the FCM, or Ferromex nowadays), with authority to make rates out of the major industrial centers such as Monterrey. I still hold that the Port of Lazaro Cardenas, Mich could become a major West Coast maritime port, if greater political stability down there could be attained. The maritime companies have clearly shown that they want competitive rail anywhere they call; and by and large they have it, save Prince Rupert, BC.
Now with the possibility of traffic from Mexico consigned to the East, staying on CP rails anywhere to the Northeast, Chessie (CSX) and Topper (NS) will have a "neigh" and a "meow", as well as claws and hind quarters, to say about this.
But all told, I think for this to have a chance, BNSF will need access, including trackage rights, into Mexico.
Posted by George Harris (Member # 2077) on :
And this will give both of the big Canadian systems access to New Orleans and thereby the Gulf of Mexico. It is not to far from being the equivalent of CN taking over ICRR. Not to mention KCS is much healthier than ICRR had been for a long time.
Posted by Gilbert B Norman (Member # 1541) on :
Trouble is, Mr. Harris, that this is much more than the Gulf.
As I noted, I don't think Warren "will take lightly" to being shut out of any Mexican traffic. He will be seeking trackage rights "South of the Border".
Topper (NS) will be less than happy about the potential loss of movement between auto assembly in and around Monterrey, NL and the parts sources around Detroit. That is "rail captive" business. Presently, KCS has to give this traffic up to somebody at KC, and Topper, with his WAB (route of the "Wabash Cannon Ball") handled this traffic avoiding "whatever can happen in" Chicago.
Now KCS can keep this traffic all to themselves, routing such over "my MILW" to Chi, thence "their SOO/CP 49% IHB" to their CP "iron clad" trackage rights over "neiiiiggh Topper" NYC to Detroit, where they can access any facility compliments of Conrail Shared Assets.
This is "not going down" easy with the Surfboard, as through three different Administrations (there is still someone on it appointed by Bush43) that want competitive rail. There will be trackage rights and access granted "all over the map", much as there was with the 90's movement.
Posted by George Harris (Member # 2077) on :
quote:Originally posted by Gilbert B Norman: Trouble is, Mr. Harris, that this is much more than the Gulf.
Too true. I think about all the things that went on with the boiling down of the west into 2 basic systems of UP+SP+MP, etc, and ATSF+BN, etc.