(erielack) Railroad profits, was Meat reefers

["Schuyler Larrabee" <schuyler.larrabee_@_verizon.net>]

 > Christopher Thurner:
> 
> I also realize that the amount and quality of information 
> going back to the EL and Erie / DL&W days is not as abundant 
> as it is today with businesses having, what seems at least, 
> almost limitless computing power with massive amounts of IT 
> resources at their disposal.  It makes me think about 
> something I read, in either one of the Trains issues, or on a 
> list like this about someone commenting about during the 
> 60's, the sales forces at many RR's had no idea what the true 
> costs of intermodal (specifically piggyback) were and how to 
> price the service accordingly.  They went on to say that in 
> 80's and 90's, with the massive amounts of IT power at hand, 
> they had a much better handle on what their costs were and 
> could make pricing and operating decisions that made it more 
> profitable.  They also lamented on how they during the 60's 
> and 70's, in many cases, had decimated profitable boxcar 
> business to migrate it to less profitable or even 
> unprofitable TOFC business.

Chris, I won't argue that the simplicity of getting analysis is probably easier in the digital age.
But there were armies of accountants working for the railroads in the earlier days you are
referencing here.  And they were using computers - yes, with punch cards, but computers.   All the
rate divisions were enough to keep legions of men busy.  I suspect that they had a pretty good idea
of what services made money, and how much.  But I agree that it probably isn't very available
information.

But the real point I wanted to make here is that the big change which made it possible for railroads
to "make pricing and operating decisions that made it more profitable" was the Staggers Act.  The
changes in the regulatory environment permitted railroads to charge rates that made sense for them,
regardless of what some other mode might be charging.  It didn't matter any more what the barge rate
was, which used to influence the rates that the ICC would allow the RR to charge, nor the trucker's
rates.

Very simple access to digital information about that time may have made a difference, but it wasn't
the watershed.

SGL


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