20 DC VELOCITY DECEMBER 2015 www.dcvelocity.com
newsworthy
per favor for railroad enmity.”
Still, Hatch, who opposes further industry consolidation
because the costs and service distractions outweigh any
benefits, said the access proposal doesn’t really address the
core issues confronting the rails in general, and Norfolk,
Va.-based Norfolk Southern (NS) in particular. In fact,
during the late-2013–to–mid-2014 time period, when rail
service suffered greatly under the brunt of severe winter
storms and a tough rebound, additional access “would have
been, to say the least, counterproductive” because more
assets potentially in play in a congested region would ulti-
mately lead to more service problems, he said.
Hatch questioned the need to layer even more complexity
on an increasingly service-intensive business that has finally
gotten back on its feet. He added that it might be difficult
to sort out just who, or what mechanism, would be used to
determine how bad service would have to get, or how high
rates would have to rise, before a customer of the combined
entity could opt for another carrier. (A CP spokesman said
it’s too early in the process to have settled on a formula.)
Hatch also doubted that the access language would solve
NS’s problems, such as a secular and dramatic decline in
coal demand that has hurt its revenues as well as those of its
Eastern rail counterpart, CSX Corp.
LONG ODDS
John G. Larkin, transport analyst for investment firm Stifel,
forecast a one-to-three chance that the merger will be con-
summated. Despite CP’s “innovative solution” to try to win
over regulators, a still-fragile economy and the fresh mem-
ories of service dysfunction will make the STB reluctant to
approve such a large-scale transaction. Larkin added that a
successful merger would trigger a new and rapid consolida-
tion cycle in the U.S. and Canada that would winnow the
number of Class I rails from six to three. “Three megamerg-
ers would be more likely to disrupt service than the one
proposed by CP,” Larkin wrote.
Despite the long odds, it is unwise to underestimate
Harrison. In October 2014, following CP’s decision to ter-
minate merger talks with CSX after just three or four meet-
ings, Harrison continued to push for further consolidation
as the only logical way to sustainably resolve congestion
problems that he said will only worsen as demand grows.
Harrison told analysts at the time that CP looked at CSX
and NS, adding that there was little difference between the
two. He claimed to be “not obsessed with some transcon-
tinental merger,” nor focused on his ego or his legacy. A
merger with CSX would have combined two great com-
plementary systems and would have eased the pressure at
Chicago because of CSX’s interest in a connecting railroad
that would have allowed CP to bypass the city, Harrison
said at the time. Left unsaid were his thoughts about NS.
Harrison may claim that ego and legacy are not involved.
But at 71, he can create the continent’s first merged transcontinental railroad and offer shippers the ability to move
their goods from Florida’s northern tip to Canada’s westernmost reaches on a single line. Given this, it would be
hard for Harrison to walk away from the opportunity to
make history.
—Mark Solomon
Toyota Industrial Equipment
Manufacturing Inc. (TIEM), the
Indiana-based company respon-
sible for building Toyota brand
forklifts, recently commemorat-
ed the manufacturing plant’s 25 years of operations
in the U.S. … Cushman & Wakefield has been named
exclusive sales agent for a 119,919-square-foot cross-
dock warehouse facility in Rancho Dominguez, Calif. The
property’s 15-acre site includes a six-acre paved trailer
storage area. … Akro-Mils has introduced wire utility
carts with heavy-duty chrome wire shelves, push handles,
five-inch swivel casters (two locking and two nonlock-
ing), and donut bumpers. … Barcoding Inc., an automat-
ic information and data capture company, has launched
a digital community called #SupplyChainGeek Network
that’s designed to support collaboration and sharing
for people involved with all aspects of the supply chain.
The company has also created OnePay by Barcoding, a
financing program that provides clients with flexible
payment options for the systems integrator’s technol-
ogy solutions and services. … Labelmaster Software’s
Dangerous Goods Information System (DGIS) 2. 2 prod-
uct has achieved SAP certification as powered by the
SAP NetWeaver technology platform. … Datalogic has
introduced the QuickScan QD2131 corded linear imager,
which provides quick scans of long one-dimensional bar
codes. … Hyundai Forklift has expanded its geographic
footprint and dealer base on the Eastern Seaboard with
the addition of Modern Group Ltd., headquartered in
Bristol, Pa. … Bastian Solutions, a global material han-
dling systems integrator, has expanded its AutoStore
distribution territory to include Latin America, India,
Australia, and New Zealand.
short takes
TIEM
