(The Fort Worth Star-Telegram posted the following story by Dan Piller on its website on February 12.)
FORT WORTH, Texas — Burlington Northern Santa Fe Railway could benefit from Toyota’s decision to build a truck assembly plant in San Antonio.
As an economic incentive, San Antonio has agreed to build an 8-mile rail line into the new plant to enable Fort Worth-based BNSF to end what otherwise would be a Union Pacific Railroad Co. monopoly into the site.
The construction will be paid primarily through a $15 million state appropriation, which Gov. Rick Perry promised San Antonio in December that he would request from the 2003 Legislature. No action has yet been taken in the current session.
BNSF spokesman Richard Russack said Tuesday that the railroad is working with the Bexar County Rural Rail Transportation District, which would build the line.
He said BNSF would be willing to contribute some of the cost, estimated to be $20 million to $22 million.
“We’re talking with everybody involved,” Russack said.
Toyota made the construction of the second line a condition of locating the plant on the site south of San Antonio that the city plans to annex. The presence of a second carrier would give Toyota the leverage of competition, allowing it to avoid the designation of a “captive shipper” served by a single carrier.
Railroad rates have been deregulated for two decades, heightening interest by big shippers in getting competitive rail service.
In addition to the 150,000 trucks that would have to be shipped each year, an automobile assembly plant relies heavily on rail service for raw materials and machinery.
Rail is still the preferred mode of long-distance transport for automobiles from their plants to big urban motor vehicle depots.
Last year, Union Pacific generated about $1.2 billion of its $11.2 billion total revenues from automobile shipments. BNSF doesn’t break out specific statistics for auto shipments.
Union Pacific originally expressed reluctance to accommodate the second line, a stand that some San Antonio officials interpreted as a way to protect a monopoly.
But Union Pacific President Ike Evans said last week that the Omaha, Neb.-based carrier had agreed to the building of the line and “is talking with all the parties,” on the matter.