Our view: New railroad owner could boost Delmarva economy

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Hello everyone,

Let’s face it. A lot of people like trains.

That’s why a story about the owner of the Delmarva Central Railroad has been one of the most read posts on the Business Now website in the past couple of days.

The story involved Pennsylvania-based Carload Express, which leased the Delmarva line of Norfolk Southern a year or so ago.

The carrier recently acquired the former BASF site near Seaford for purposes that could include a site that would transfer some shipments to their final destinations via truck.

The 160-mile-long line runs from the Bear-New Castle area into central Delaware and Maryland. It also serves a few short lines on the peninsula.

Over the past year, Carload Express has made a visible investment in the form of locomotives carrying its distinctive burgundy design scheme.

An SVN Miller release announcing the BASF site sale also noted that the Carload Express deal was the third deal along rail lines in recent months. Clearly, proximity to rail is becoming a plus.

Rail accesshas long been a concern on the peninsula, which depends on shipments of grain, propane and other commodities. Customers suffered through the travails of the Pennsylvania Railroad and its successor, government-owned Conrail.

Norfolk Southern acquired a piece of Conrail when it was sold by Uncle Sam, but despite some marketing efforts, the mega-railroad could not get the desired return on its investment out of the Delmarva line.

One key to success is customer service. Carload Express has learned a thing or two about customer relationships while operating short lines in Pennsylvania and Ohio.

Still, the secret sauce may be a popular tax break that actually spurs investment.

Chances are good that Congress will renew the tax credit, increasing prospects of further track and other improvements on Delmarva that did not make financial sense for Nortfolk Southern.

Here’s hoping your day is on the right track. The newsletter returns tomorrow. – Doug Rainey, publisher.

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