BNSF threatens shutdown over PTC deadline

[aikorob]

not sure if this has been posted before:
http://cs.trains.com/trn/b/fred-frailey/archive/2015/09/09/bnsf-we-will-be-paralyzed.aspx

[Rich_S]

Not only BNSF, NS has also sent letters to it's customers and to congress where it said in a nut shell

we might be required to cease shipping TIH commodities and to decline to host passenger trains on our network effective January 1, 2016, as the only
complete solution to the risks of non-compliance. 

For more info you can read both letters on the NS web page

http://www.nscorp.com/content/nscorp/en/about-ns/government-relations/where-we-stand/positive-train-control.html

It's my understanding that UP and CSX have also made similar statements.

[Scottl]

Interesting.  Typical positioning for a negotiated extension, I am sure.

[Philip H]

Seriously? Corporations that had years of warnings and make $10s if not $100s in net profits can't meet a simple deadline? And the solution is holding shippers hostage to see if they can get the deadline lifted?   
A

[Ed Kapuscinski]

Seriously? Corporations that had years of warnings and make $10s if not $100s in net profits can't meet a simple deadline? And the solution is holding shippers hostage to see if they can get the deadline lifted?   
A

Yep. It's not actually that cut and dried.

For example, when the deadline was decided, the technology wasn't even ready, so it wasn't like a case of "you have x days to install y technology".

It was more "you have x months to invent y technology, then test and install it". Add to that there was a year where the FCC held things up (rightly or wrongly), and the whole thing comes down to the railroads being asked to do something that was, essentially, impossible regardless of how much money they dropped on it.

Give this a read for a bit more info on the topic: http://www.rypn.org/forums/viewtopic.php?f=1&t=38550&sid=c424a198efa7f6bdc1c7f017ab0e01bc

It's all pretty screwed up.

[C855B]

Yeah, I love it when legislatures mandate adoption of new technologies. They are swayed by the "experts" who created (and are selling!) the tech, who will of course kinda sorta leave out the downsides, or the "unknown unknowns", versus the "known unknowns".   Having half an idea of what they were dealing with - replacing signalling systems going back to the 1920s, as there is no retrofit with PTC - this was a much, much, much bigger job than imagined, even without mentioning the wireless network tech they're now having to "field debug".

The light bulb mandate was the same thing. Nobody bothered to tell Congress that the ******* ******* CFLs are crap in cold temperatures and only have half the life expectancy promised, yet here we are with the supply chain of incandescents cut off at the knees. Idiots.

[Philip H]

Sorry guys, I just don't buy it.  Working for a federal regulatory agency I see how the sausage is made.  If Ed's post is accurate, the USDOT gave the railroads 7 years to talk, air their concerns, and start work. 7 years.  We shot Mercury in less time . . . . so while PTC may be a solution in search of a problem, timelines and deadlines are not the issue.

[C855B]

... We shot Mercury in less time . . . . so while PTC may be a solution in search of a problem, timelines and deadlines are not the issue.

And... I worked for NASA. When money is no object and your project isn't dependent on keeping other products or processes alive, you can work miracles.

When it is a mostly unfunded mandate and you remain beholden to shareholders and customers, and have to operate on the patient with heart still beating, the process is infinitely more complicated. I'm sure the integration engineers, installers and other tech players would love to say "Oh, shut the railroad down for two or three years while we're working on this, it'll go 10 times faster. And we'll fix the bugs on the fly when we can let you run a couple of trains." Been there with similar systems, and it doesn't work that way.

[Ed Kapuscinski]

Exactly what Mike says.

I've learned the same thing with websites: it's a lot easier to build things from scratch. Once something is up and running, making upgrades is at least twice as complicated. You have to be doubly careful so you don't mess up things that are currently up and running. You have to worry about downtime while making changes, etc...

With the web, there are strategies you can use to make it a lot easier (load balancers, blue green, etc...), but there's only one Tower 55, only one Horseshoe Curve, etc... sure, you can detour some stuff over other routes, but that's not often feasible.

I don't think the Mercury project is an apt comparison. It's more like if they tried the apollo missions, but were building the launch facilities in the middle of Laguardia.

[Philip H]

Any railroad that has a PTC mandate worth its salt could meet the deadline with a sacrifice of profits, not performance.  or it could . . . perish the thought . . . lobby Congress to get the law changed.  Sorry, I have no sympathy for a 7 year lead time and whinning about not being able to meet the deadline in a hugely profitable business.

[Rich_S]

Any railroad that has a PTC mandate worth its salt could meet the deadline with a sacrifice of profits, not performance.  or it could . . . perish the thought . . . lobby Congress to get the law changed.  Sorry, I have no sympathy for a 7 year lead time and whinning about not being able to meet the deadline in a hugely profitable business.

Well I can tell you first hand, 7 years was not long enough. I work for one of the railroads who is not going to meet the deadline. I've also installed PTC equipment on locomotives and back when this thing got started current PTC technology did not exist. Second problem, not one single company creates the entire system, the major players are New York Air Brake and WABTEC. Back when we first started installing PTC, we were receiving weekly software updates and quarterly hardware updates. Within 6 months we went through several hardware updates and all this cost extra money. As other have mentioned, PTC is not just a box that gets slapped onto a locomotives. It's actually made up of many components that have to interact with existing components that were never intended to communicate with an external system. Railroads are not as profitable as you claim, as coal and oil shipments drop, also does the profits. It seems our stock prices have been dropping for the last several months. The economy is slowing down to the point UP already has 2,600 employees laid off, and CSX has laid off 600 employees. When you are laying people off, you have less money to spend in other areas. With the current PTC configuration, it takes us a week to install PTC on one locomotive, that is two people per shift, three shifts per day, seven days per week.  Can we add more people, no because we cannot get the kits from NYAB and WABTEC. Another issue we are now running into, the first installs are not PTC compliant and must be upgraded, so all that work 4 to 7 years ago is now obsolete and needs upgraded. Being on this side of the fence, I can honestly say the railroads made a good faith effort to install PTC, they have just run into too many hurdles in the time given. Another issue is the cell towers that need installed along the right of ways. Again the railroads have run into hurdles, either from communities protesting the placement of cell towers to someone saying a tower cannot be placed there because it's the breading ground of the specked winged midnight honey pecker. But this is once again the government not listening to the experts and blaming it on bogus BS, you know the same old argument, greedy capitalist bla bla bla.

Now let me ask you this, the federal government told the railroads in 1968 they had to remove roof walks from freight cars by 1978 with the exception of cars that are loaded from the roof (i.e. covered hoppers, etc.) That is 10 years to remove a roof walk, but this government wants the railroads to install a very complex computer system in just 7 years?   

[Kisatchie]

...the federal government told the railroads in 1968 they had to remove roof walks from freight cars by 1978 with the exception of cars that are loaded from the roof (i.e. covered hoppers, etc.) That is 10 years to remove a roof walk, but this government wants the railroads to install a very complex computer system in just 7 years?   

Uh oh, Dee's been drinking too much coffee...


Hmm... kill the government...

[Philip H]

Rich,

All good, if sad, information.  But holding shippers hostage is not the answer, and while revenues and stocks may be down this year, that hasn't been the case for the last several years (as my own stock portfolio will attest).  I also don't think the roofwalks are a good analogy - that could be done during regular maintenance without much operational impact.  Clearly PTC installations can't based on your descriptions.

And while laying off people is no fun for anyone - that very often happens because private corporations are trying to meet a dividend target, which requires a certain level of profit.  People can always be retained (except in dire circumstances) if the company is willing to lower its profits temporarily.  That most don't is telling.

As to the updates and obsolescence problems - that is a fact of technological life it seems, and one that business claims it knows better then government how to overcome.  Draw your own conclusions.  I do know that well crafted contracts can account for that sort of thing, and that when a contract doesn't, its often because a bottom line was more important then getting it right.  Your "we can't add more people because we can't get the kits" is a case in point - my read is there's no financial penalty to your vendors for not ramping up production, so they go along at a level that may not be the right one, slowing you and your colleagues down.  Not your fault, but it will impact your railroad's ability to do the legally mandated stuff it needs to do.  And vendors can often overcome the issues when properly motivated.

Finally, as a government employee - I'd appreciate the same deference on this that you as a professional railroader want.  In nearly every case we are listening and we do sympathize.  We also has a law that says "you SHALL do X" where shall is not really an option for us. And so when we reach the "fish or cut bait" point, we do tire of what appear to be excuses. Most times we'd be happy to have the stakeholders we seek to regulate go to Congress and get us all some relief - but holding a figurative gun to the shippers heads is a piss poor way to do it.

[Rich_S]

I also don't think the roofwalks are a good analogy - that could be done during regular maintenance without much operational impact.  Clearly PTC installations can't based on your descriptions.
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but holding a figurative gun to the shippers heads is a piss poor way to do it.

Philip, For the roofwalks, I think it's the perfect analogy, 10 years to perform a simple task, even if it was done during regular maintenance, but for PTC the government only gave the railroads 7 years to design, manufacture and equip the fleet with entirely new technology. Also just in case anyone might not know, PTC not only involves the locomotive fleet, but upgrades are required on the mainline for signaling along with cell towers for communication.

My next point and I don't want to get into a debate over governments philosophies versus those of private corporations. I can tell you I work in a new engine house that was paid for 100% by profits, no bank loans, no grants, everything was paid for from operating profits. If government cannot operate within it's means, it just raises taxes, we are a captive audience, we either pay or go to jail. If the railroads were to continue to raise rates every time it needed more money, before long all freight would ride on the highways. Passenger trains and LCL are two perfect examples of what happens when you're paying out more than you're taking in. 

Your last point, the railroads are not holding shippers hostage, they are telling them the truth, we are not ready and we are not going to break the law. There are no magic wands, we are not going to be ready, If there is not an extension, the railroads do not intend to break the law which would incur a $25,000 per day fine to haul products that require full PTC implementation which are TIH, "Toxic Inhalation Hazard" and passengers.  And that opens another can of worms as the Shared assets cannot reach East Coast customers without the NEC access.

The best thing congress can do at this time is grant a 5 year extension, while we continue to add PTC to the railroad, otherwise I might be on the bread line come January?     

[sirenwerks]

For example, when the deadline was decided, the technology wasn't even ready, so it wasn't like a case of "you have x days to install y technology".

It was more "you have x months to invent y technology, then test and install it". Add to that there was a year where the FCC held things up (rightly or wrongly), and the whole thing comes down to the railroads being asked to do something that was, essentially, impossible regardless of how much money they dropped on it.
f=1&t=38550&sid=c424a198efa7f6bdc1c7f017ab0e01bc

This, actually, is a proven way of developing new technologies - by force of deadline.  The US is a civil society and we all are expected to make sacrifices for the greater good because of this arrangement.  It certainly worked in war-time, and it's overdue for transportation now too.  While the notion of RR land grants gets abused (few actually got federal land subsidies) RRs get accomodations still, just look at the removal of so many at-grade crossings in this country over the last 20 years, many by simple road closures (to the public's chagrin) or by federal/state/locally funded (that's your tax dollars) road projects. 

And look what EPA emmissions laws have done for the RRs.  First they kicked and screamed, but the federally-funded research dumped into the new tech needed to meet stricter air quality standards has vastly improved fuel economy for the Class 1s.  EMD and GE weren't doing that research on their own before the EPA came-a-knockin'.  The fuel savings helped NS and its kin in terms of immediate bottom line, and offered them the ability to market themselves as revisionists and a greener transportation solution to their competitors - the truck.  Besides, railroads need to upgrade their fleets over time so it's not like they wouldn't need to buy new loci anyway. 

The increase in rail traffic on fewer rail lines and shrunken crew size (and subsequent attention) demands considerable increase in safety gaurantees for the public which shares ROW.  Add to that the increases in chemicals and petroleum traveling by rail and it's time for railroads to stop whining and be a part of our civil society.  They've known this was coming for a long time.