A nice relaxing pool sounds pretty good on an August Friday! Actually, railroad pool cars are anything but wet. Equipment pools come in all shapes and sizes. It’s not the type of car but how they’re used that makes it a pool.
How They Work
A freight car pool is set up so that a number of participating railroads have access to the cars they need for a specific service whenever necessary but without having to front the costs of purchasing all of the cars on their own. Sometimes the cars are purchased by the participating railroads directly. Other times a car leasing company is used to supply the rolling stock. Or it could be a combination of both.
Let’s look at a few common examples for a better understanding.
With “just in time” delivery demands, auto manufacturers can’t be kept waiting. If the railroads want to secure this business from trucks they can not afford to risk the delays often associated with handling individual car orders like we’ve discussed in last month’s operating blogs.
To help insure a consistent and constant flow of cars, railroads will pool equipment for specific service routes. It helps that most auto parts movements are repetitive. Each railroad which is part of the delivery chain between two assembly plants will contribute cars to the pool. Most pools of this nature include two or three railroads. And each railroad, indeed each assembly plant, may be involved in multiple pools of this nature.
The number of cars contributed is relative to the amount of miles they carry the cars. (Freight charges are also based on this mileage.) The road which carries the car for the longest haul contributes the most cars. A small terminal railroad delivering the cars from a local yard may only contribute one or two cars, meaning you may not see each railroads’ cars on every trip.
It is not uncommon for a car to stay in the same pool for years, making repeated round trips between plants. This is a nice bonus for modelers as seeing the same car on the same train over and over is perfectly prototypical,
Trailer and container cars in intermodal service represent the largest pool and a completely different look to the operation. Here the pool is nationwide, not confined to specific routes.
While some railroads do contribute cars to the overall pool, it is not based on the number of cars they use. In fact, some of the largest railroad intermodal fleets are rostered by shortline companies that may not even have an intermodal terminal. These cars earn money in much the same way as the “per diem boxcars” of the 1970s – fees paid back to the owner by others for the use of the cars.
The largest contributor to the intermodal pool is TTX. TTX Corporation (originally Trailer Train) was started by the railroads for just such a service. Although it is an independent company, its largest shareholders are the railroads themselves. Today the company’s services go far beyond the intermodal market and include box, gondola, flatcar and other specialized equipment.
The efficiency of the pools like this is in simplicity. There is an ever-present supply of cars wherever needed and that supply can be easily moved from one region to another if there are economic changes in traffic patterns. Operations are simplified by just sending the cars to wherever they are needed next. Cars are tracked and the owners billed appropriately for use.
Finished automobile traffic is worthy of note as it represents a combination of both of the above examples. Indeed, most auto racks share both leased and railroad-owned parts themselves.
Railroads traditionally own the autorack which is placed on a flatcar leased from TTX. In some cases the railroads choose to own the flatcar too. The pool is nationwide like the intermodal pool, but railroads supply a number of racks based on their participation. That is, their fleet is based on the number of loads they receive or ship at their online customers and terminals.
Their cars are not bound to their terminals, but are used in the general movement of finished autos across the continent. Railroads which serve more ramps will own more cars in the pool. This is somewhat different than the mileage based arrangement common with the auto parts, but the effect is much the same. It also results in some wonderfully varied and colorful consists on trains all across North America.
The use of pools to move freight is by no means limited to the examples listed here. It is just one more way railroads have learned to cooperate to provide better service for customers and in the end, better revenues for all. And that is a refreshing thought!