Re: Per Diem


In a message dated 12/24/2007 3:10:38 PM Eastern Standard Time,
thompson@... writes:

Jon Miller wrote:
Was not per diem paid by businesses if they kept the car longer
than the assigned load/unload time?
That's called "demurrage," Jon, and there was an allowance of so
many days to unload, without penalty to the receiving business. Beyond
that, they would be billed for a daily charge, the "demurrage." The
per-diem charges were not directly charged to shippers or receivers,
but were part of the railroad's cost of moving the car.


Tony's right on demurrage. As for per diem, some roads did try to reduce
it. The Lehigh & Hudson River, for example, was a point-to-point bridge line
with just a few major on-line businesses. Its schedules in the steam days and
through its inclusion into Conrail were such that none of the bridge traffic
was on its railroad at midnight, thus keeping per diems down a minimum
(sticking its interline partners with it).

Demurrage still continues today and, in fact, BNSF is sending a big new
ripple through the industry by charging demurrage on its cars while they are
travelling on other railiroads, claiming loss of use while delayed elsewhere.

Mike Del Vecchio

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