08-17-2011, 12:18 PM
faraway Wrote:I assume they have a much lower labor cost structure permitting labor intensive work. On the other hand I assume they are short on capital and reuse older equipment to prevent capital expenditures and high depreciations in their balance sheet.
LAJ is a wholly owned subsidiary of BNSF, but they have a lower wage union contract than the BNSF. As you can see they have historically run "hand me down" locomotives from the BNSF. The LPG 1200's were bought or leased new by the Santa Fe, but almost immediately they were transferred to the LAJ. When short lines like the PHL buy new equipment, it is usually with government funding to reduce emissions. I don't know if there is any place other than Los Angeles where the government will help a railroad buy low emission equipment to reduce air pollution. The Arkansas & Missouri is typical of short lines created from divestiture. The priced out used locomotives and found that they could buy 3 used Alco Century 420s for the same price as one used EMD model, so they bought up almost all of the use C420's available and cannibalize two units to keep one running. Another example is Micheal Gross, the actor from the Family Ties television show bought the Santa Fe branch from the Santa Fe that runs from Lamy, New Mexico to Santa Fe, New Mexico. The last I heard, he was using one or more used Cf7s from the Santa Fe.