ROANOKE TIMES
Copyright (c) 1997, Roanoke Times
DATE: Friday, April 11, 1997 TAG: 9704110053
SECTION: EDITORIAL PAGE: A-10 EDITION: METRO
By improving rail connections to the Northeast, the Conrail deal could enhance this region's economic competitiveness.
ROANOKE, don't sweat it.
That seemed to be the word from Norfolk Southern this week, as details were hammered out between NS and competitor CSX over the division of the Conrail spoils.
The reassurance is welcome. The interest of the Roanoke Valley in the jobs impact of the NS-CSX acquisition and division of Conrail is obvious. The railroad, though not so overwhelmingly dominant as in the days when NS predecessor Norfolk & Western was headquartered here, remains a major component of the local economy. With a workforce of 3,200, NS is the Roanoke Valley's second largest employer.
But valuable as is railroading's contribution as an employer to the economy of Roanoke and of Western Virginia, it contributes in another way that, over time, is every bit as important. As part of the region's transportation infrastructure, both NS and CSX provide a mode by which Western Virginia products can be moved to markets
For a couple of reasons, the Conrail deal implies improvement to Western Virginia's transportation positioning within the context of the national and international economies.
First, NS - smaller but more cash-rich than CSX - will pay somewhat more ($5.9 billion to CSX's $4.3 billion) to get somewhat more (6,000 miles of Conrail track to 5,000 for CSX). This will put the new CSX and the new NS closer in size than before. That - plus the fact that no longer will one railroad, Conrail, have a near-monopoly in the Northeast - suggests that the Conrail deal is one acquisition that will lead to more rather than less competition.
Second, the deal for the first time will give both NS and CSX direct access to lucrative Northeast markets. The result should be an end to the inefficiencies created when freight to the Northeast could be shipped only partway on the same line.
The implication, at least, is cheaper, faster shipping between Western Virginia and the rest of the eastern half of the continent. In an era of just-in-time production and on-time delivery, the Roanoke Valley and the region beyond should be asking not only whether NS jobs will stay but also how to turn better rail connections to competitive advantage.
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