In this blog post, we’ll be answering six common questions that shippers and logistics professionals often ask us about rail transportation. We understand that rail logistics can be a complex and confusing process, which is why we’ve enlisted the help of our experts in the industry to provide you with the most accurate and up-to-date information.
The questions we’ll be addressing are as follows:
- Why isn’t my railcar moving?
- Why do cars take so long to interchange?
- What measures can be taken to catch out-of-route cars?
- How do I determine which shop is the best location to take my railcars for repair/cleaning?
- How do I track maintenance and qualification costs?
- How are taxes managed once my railcar crosses the border?
By the end of this post, you’ll have a better understanding of rail logistics and how to navigate it with ease.
So, let’s get started!
Why Isn’t my Railcar Moving?
There are several reasons why your railcar may be delayed. Some of the most common causes include:
- Congestion
- Mechanical Issues or Damage
- Crew Changes or Scheduling
- Weather
- Track Maintenance or Construction
- Operational Issues
- Customs or Regulatory Holds
Congestion
Rail networks can experience congestion, particularly at major interchange points or in busy rail yards. This congestion may cause delays in train movements, leading to temporary stops or slow progress for your railcar.
Mechanical Issues or Damage (Bad Order)
If your railcar is experiencing mechanical issues or has sustained damage, it may be stopped for repairs. Depending on the severity of the issue, this could result in a temporary or extended delay in your railcar’s movement.
Crew Changes or Scheduling
Train crews have federally mandated work hour limits, and when these limits are reached, a crew change is required. Your railcar may not be moving due to a crew change or scheduling issues related to the train crew.
Weather-Related Disruptions
Extreme weather conditions, such as heavy snow, flooding, or storms, can impact rail operations and cause delays or temporary stoppages in railcar movement.
Track Maintenance or Construction
Rail networks require regular maintenance and may also undergo construction or expansion projects. If your railcar is not moving, it could be due to track maintenance or construction activities in the area.
Operational Issues
Rail carriers may encounter operational issues, such as equipment malfunctions or logistical challenges, that can temporarily impact railcar movement.
Customs or Regulatory Hold
If your railcar is crossing an international border or transporting regulated goods, it may be subject to inspection or clearance by customs or regulatory agencies. This process can result in temporary delays or holds on railcar movement.
Why do Cars Take so Long to Interchange?
The interchange of railcars between different rail carriers can sometimes be a lengthy process due to several factors:
- Operational Differences
- Congestion
- Yard Operations
- Paperwork or Communication
- Crew Availability
- Regulatory Compliance
Operational Differences
Different rail carriers have their own operating rules, procedures, and schedules, which can cause delays when interchanging cars. They may also use different types of equipment, creating compatibility issues that can slow down the process.
Congestion
Rail traffic congestion can result in longer wait times for trains to move between carriers, particularly at busy interchange points. The limited capacity of tracks, sidings, and yards can exacerbate this issue.
Yard Operations
The process of assembling and disassembling trains in rail yards, which often involves sorting, switching, and marshaling railcars, can be time-consuming. Rail yard operations can be further complicated by limited yard capacity, resource constraints, or weather-related disruptions.
Paperwork and Communication
Interchange between carriers requires coordination and communication, which includes exchanging paperwork, billing information, and car routing instructions. This process can be cumbersome and slow, especially when done manually or when multiple carriers are involved.
Crew Availability
Interchanging freight cars between carriers may require a change of crew or the coordination of crew schedules. Ensuring that the necessary personnel are available and ready to handle the interchange can sometimes be a challenge, leading to delays.
Regulatory Compliance
Different jurisdictions and regulatory bodies may impose specific requirements and restrictions on rail operations, which can impact the interchange process. Compliance with these regulations can add complexity and time to the interchange process.
What Measures can be Taken to Catch Out-of-Route Cars?
Identifying an out-of-route railcar involves detecting when a railcar is not following its intended route. This can occur due to errors in routing instructions, mishandling, or operational issues.
Track the Railcar’s Location
Railcars are equipped with Automatic Equipment Identification (AEI) tags, and sometimes GPS devices that allow them to be tracked in real-time. By monitoring the location of the railcar, you can compare its actual position with its intended route and identify any discrepancies.
Monitor the Railcar’s Progress
Keep track of the railcar’s progress through its journey, noting any deviations from its intended route or schedule. This can include checking the car’s movement through interchange points, yard locations, and stops along the way.
Two simple ways to determine if your railcar may be out of route are:
- Monitor the rail carriers the railcar is moving on – if you notice that the actual railcar movement seems to be different from the routing instructions in the waybill, it’s possible the railcar may be out of route.
- Identify stations/cities/regions you know are out of route and if you notice the railcar moving through them, it’s possible the railroad has misrouted the railcar.
If you are having difficulty, or finding it is too time consuming, to track and monitor manually, consider a rail application that automates these processes. Our smart railcar management software, Rail Command, lets you track shipments in one place, manage your railcar fleet, automate reporting, and more. You can learn more about Rail Command by clicking the link!
How do I Determine Which Shop is the Best Location to Take my Railcars for Repair/Cleaning?
To determine which shop location is best for cleaning and/or repair, first you have to understand your railcar ownership. Do you lease your cars from a railroad or business? Or do you own your own railcars?
Leased Railcars
Railcars you are leasing from car owners fall under two types of leasing arrangements:
- Full Service
- Net Lease
In a full-service lease, the car owner (lessor) covers most expenses related to maintenance and upkeep of the railcar. This may include repairs, regulatory compliance, and upgrades. This type of lease is ideal for customers who do not have the resources or expertise to manage maintenance and compliance themselves.
In a net lease, the customer (lessee) assumes responsibility for most of the maintenance and upkeep costs of the railcar. This may include inspections, repairs, regulatory compliance, and upgrades. This type of lease is ideal for customers who have the resources and expertise to manage maintenance and compliance and are looking for more control and flexibility of their railcar fleet.
Owned Railcars
An owned railcar refers to a railcar that is purchased and owned by your company rather than being leased from a leasing company or railroad.
With an owned railcar, the owner (you) is responsible for all aspects of maintenance, repair, and regulatory compliance. The owner is also responsible for all associated costs including purchase price, maintenance, insurance, and taxes.
Now that we know the difference between leased and owned railcars, we can see how it applies to determining what shops to use.
Leased Railcars and Determining Shops
Approved Shop Network
When leasing railcars, you need to work with an approved shop network. The car owner usually has a list of pre-approved repair facilities that you must use for maintenance and repairs to comply with the terms of your lease agreement.
Car Owner Dictates
The car owner often dictates which shops can be used. This helps ensure quality control and maintain the value of their assets. Always consult with the railcar owner to make sure you are using the approved shops for your leased railcars.
Owned Railcars and Determining Shops
Distance from Facility
The distance between the repair shop and your facility can impact overall transportation costs and transit times. Choosing a shop that is closer to your facility can reduce costs and ensure faster turnaround times.
Shop Costs
Compare the costs of different repair shops to find the best value. Keep in mind that the cheapest option may not always provide the highest quality work. Make sure to consider factors such as labor rates, parts costs, and warranties when comparing shop costs.
Railcar Dwell at Shop
The length of time a railcar spends at a repair shop can impact your overall railcar availability. Consider the average dwell time at different shops when making your decision. A shop with a shorter dwell time may be more efficient, allowing your railcars to get back into service more quickly.
How do I Track Maintenance and Qualification Costs?
Keeping track of railcar maintenance and qualification costs is essential to managing a railcar fleet efficiently. Here are some steps and strategies to effectively monitor these costs:
- Establish a Maintenance Schedule
- Use Asset Management Software
- Assign Responsibility
- Maintain Detailed Records
- Centralize Documentation
- Analyze Costs
- Budget and Forecast
- Stay Informed About Regulations
Establish a Maintenance Schedule
Create a comprehensive maintenance schedule for each railcar based on manufacturer recommendations, industry best practices, and regulatory requirements. This schedule should include routine inspections, preventive maintenance, and necessary repairs or upgrades.
Use Asset Management Software
Implement railcar asset management software or a fleet management system that allows you to track and monitor maintenance activities, qualification costs, and other expenses associated with each railcar. This software should be able to generate reports and provide alerts for upcoming maintenance tasks or inspections.
Assign Responsibility
Designate a person or team within your organization to oversee railcar maintenance and cost tracking. This person or team should have the necessary expertise and authority to manage maintenance activities and ensure compliance with all regulations.
Maintain Detailed Records
Keep accurate and up-to-date records of all maintenance work performed on each railcar, including dates, work descriptions, parts replaced, labor hours, and costs. These records will not only help you track costs but also serve as documentation for regulatory compliance and audits.
Centralize Documentation
Store all maintenance records, invoices, and other documentation related to railcar maintenance and qualification costs in a centralized location or database. This will make it easier to access, analyze, and share information when needed.
Analyze Costs
Regularly review and analyze the maintenance and qualification costs associated with each railcar to identify trends, inefficiencies, or potential cost-saving opportunities. Comparing costs across your fleet can help you identify areas for improvement and optimization.
Budgeting and Forecasting
Use historical maintenance and qualification costs data to create budgets and forecasts for future expenses. This will help you plan and allocate resources more effectively, minimizing the risk of unexpected costs or financial strain.
Stay Informed About Regulations
Keep up to date with any changes to regulatory requirements that could impact your railcar maintenance and qualification costs. Ensure that your maintenance plans and cost tracking efforts align with these requirements.
Still having trouble tracking maintenance and qualification costs? Reach out to our experts for a pain free, no risk, assessment of your current rail tools and processes.
How are Taxes Managed Once my Railcar Crosses the Border?
When a railcar crosses an international border, taxes and duties may need to be managed to account for the movement of goods between countries. These taxes can include import duties, value-added taxes (VAT), and other applicable fees. Here’s a general overview of how taxes are managed when a railcar crosses the border:
- Customs Documentation
- Customs Broker
- Declaration and Assessment
- Payment of Taxes and Duties
- Release of Cargo
- Recordkeeping and Reporting
Customs Documentation
Before the railcar crosses the border, the shipper must prepare and submit customs documentation, such as a commercial invoice, packing list, and bill of lading. These documents provide information about the cargo, its value, and the parties involved in the transaction, which is used by customs authorities to assess applicable taxes and duties.
Customs Broker
Many companies and individuals rely on the services of a customs broker to facilitate the import and export process. A customs broker is a licensed professional who has expertise in customs regulations and procedures, and they can help ensure that all documentation is completed correctly, and taxes are properly calculated and paid.
Declaration and Assessment
Upon arrival at the border, the railcar and its cargo are subject to inspection by customs authorities. Customs officials will review the documentation provided and assess the applicable taxes and duties based on the cargo’s classification, value, and origin.
Payment of Taxes and Duties
Once the taxes and duties have been assessed, the importer (or their customs broker) must pay the required amount to the customs authorities. This payment can be made directly at the border or through an established account with the customs agency.
Release of Cargo
After the taxes and duties have been paid and all documentation has been reviewed and approved, the customs authorities will release the railcar and its cargo to continue its journey across the border. In some cases, additional inspections or examinations may be required before the cargo is released.
Recordkeeping and Reporting
Importers and exporters are required to maintain records of their international transactions, including documentation related to taxes and duties paid. These records may be subject to audit by customs authorities to ensure compliance with tax and trade regulations.
Rail logistics can be a complicated process, but with the right knowledge and expertise, it can be streamlined and efficient. We hope that this blog post has provided you with valuable information and answers to some of the most common questions about rail transportation.
From understanding why your railcar may not be moving to tracking maintenance costs, we’ve covered a range of topics that are important for anyone involved in rail logistics. By staying up-to-date with industry trends and best practices, you can ensure that your rail operations run smoothly and effectively.
At the end of the day, it’s crucial to work with experienced professionals who can guide you through the intricacies of rail logistics. By leveraging their expertise and following best practices, you can ensure that your rail transportation is safe, efficient, and cost-effective. If you need help with your rail logistics or have more questions, reach out to our industry experts for further guidance and support.
