WASHINGTON — Tie-ups on Union Pacific Railroad Co. are costing shippers at least $40 million a month, and the traffic jams show no sign of improving, according to a survey from the Society of the Plastics Industry Inc. and two other trade associations.
Washington-based SPI, the Chemical Manufacturers Association and the National Industrial Transportation League said in a Feb. 20 joint filing with the federal Surface Transportation Board that the problems cost major resin producers, chemical companies and other large shippers an average of $620,000 each in January.
The joint survey and another, less-precise SPI survey of processors were submitted after STB requested specific data from shippers to decide whether to extend an earlier emergency order forcing UP to open part of its network. STB on Feb. 25 extended that order until Aug. 2, a decision SPI officials said was inadequate.
The joint survey was based on 65 companies using 125,000 cars per month to ship products from a total of 580 facilities. SPI also surveyed about a dozen processor members with multiple plants, and presented the anecdotal results to STB.
``The rail crisis is costing the plastics industry a lot of money, with no end in site,'' said Maureen Healey, SPI director of transportation issues.
Recent UP computer problems and attempts to make some tracks unidirectional have made the problem worse, she said.
UP spokesman John Bromley agreed that service has been worsening, and said the railroad has stopped setting a date for fixing the problems stemming from its merger with the Southern Pacific in 1996.
``The service measurements have been flat and in some cases worsened,'' he said.
The surveys said:
Dow Chemical Co. found UP's on-time performance slipped in early February to less than 15 percent, down from 40-55 percent during the problems in the fall and 86 percent in early 1997.
System train speed dropped to 13.8 miles in early February, vs. 18.4 mph before the problems started. Average speed had increased through January, but fell again, the survey said.
Sixty percent of processors said service now is worse than in September, and 25 percent said it has fallen since Christmas. Sixty percent said service is the same since Christmas.
Overall, large company shippers said service between October and January was 54-66 percent worse than a year ago.
Processors gave individual examples such as doubling lead times, taking two months on a trip that normally takes two weeks and spending $25,000 to take material off a rail car and truck it to Mexico.
The surveys come as both STB and the Senate Commerce Committee plan to discuss proposals pushed strongly by SPI, Texas regulators and others for more competition and open access to track.
A Feb. 12 letter from Commerce Chairman Sen. John McCain, R-Ariz., and Sen. Kay Bailey Hutchison, chairwoman of a key subcommittee, did not endorse those competitive access proposals but said there should be a ``thorough review'' of them.
But STB has rejected a competitive access proposal from Texas regulators, and said in its Feb. 25 statement that the chief cause of the rail problems in Houston is poor infrastructure, not lack of competition.
Healey said STB has been ``woefully inadequate in addressing this in any meaningful fashion.'' SPI plans to step up its effort in Congress.
STB Chairwoman Linda Morgan met with SPI officials and member firms in Houston March 3, during several days in Texas touring rail yards and meeting with shippers.