Tribute to railroads
In his annual letter Warren Buffett waxes about Burlington Northern and Santa Fe:
Rail is essential to America’s economic future. It is clearly the most efficient way – measured by cost, fuel usage and carbon intensity – of moving heavy materials to distant destinations. Trucking wins for short hauls, but many goods that Americans need must travel to customers many hundreds or even several thousands of miles away. The country can’t run without rail, and the industry’s capital needs will always be huge. Indeed, compared to most American businesses, railroads eat capital.BNSF is the largest of six major rail systems that blanket North America. Our railroad carries its 23,759 miles of main track, 99 tunnels, 13,495 bridges, 7,521 locomotives and assorted other fixed assets at $70 billion on its balance sheet. But my guess is that it would cost at least$500 billion to replicate those assets and decades to complete the job.
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North America’s rail system moves huge quantities of coal, grain, autos, imported and exported goods, etc. one-way for long distances and those trips often create a revenue problem for back-hauls. Weather conditions are extreme and frequently hamper or even stymie the utilization of track, bridges and equipment. Flooding can be a nightmare. None of this is a surprise. While I sit in an always-comfortable office, railroading is an outdoor activity with many employees working under trying and sometimes dangerous conditions.An evolving problem is that a growing percentage of Americans are not looking for the difficult, and often lonely, employment conditions inherent in some rail operations. Engineers must deal with the fact that among an American population of 335 million, some forlorn or mentally-disturbed Americans are going to elect suicide by lying in front of a 100-car, extraordinarily heavy train that can’t be stopped in less than a mile or more. Would you like to be the helpless engineer? This trauma happens about once a day in North America; it is far more common in Europe and will always be with us.
Wage negotiations in the rail industry can end up in the hands of the President andCongress. Additionally, American railroads arer equired to carry many dangerous products everyday that the industry would much rather avoid. The words “common carrier” define railroad responsibilities.
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I believe that our vast service territory is second to none and that therefore our margin comparisons can and should improve.I am particularly proud of both BNSF’s contribution to the country and the people who work in sub-zero outdoor jobs in North Dakota and Montana winters to keep America’s commercial arteries open. Railroads don’t get much attention when they are working but, were they unavailable, the void would be noticed immediately throughout America. A century from now, BNSF will continue to be a major asset of the country and ofBerkshire. You can count on that.
love it. The boy from Omaha now owns the railroad.
Did Paul Harvey ever do a tribute to the railroad man the way he did to a farmer? (was Paul Harvey a poet?) (did Dodge’s God Made A Farmer ad work?)
The railroad man gets a tough rap in song and tale.
Are Shocking Blue the best band ever from Den Haag?
