There are approximately 630 freight companies in the U.S., known as regional and short lines (Class II and III, respectively). They range in size from tiny family businesses that handle a few cars a month to huge lines that are close to Class I railroads in volume (up to $270 million in revenue per year). Combined, they earn several billion dollars annually.
The second class railroads are those with more than $40 million in revenue per year. There are about 20 such companies. The rest are Class III railroads, the largest group.
The regional and short lines have only about 50,000 km of network. In some states, they serve up to a quarter of all rail lines.
Class II and III railroads employ 17,800 workers. They ship more than 9 million cars annually.
Today’s railroad industry carries short line freight in large part a product of deregulation that began in the country in 1980. By then, short lines were only 8,000 miles.
Short lines are the only way to connect to the nationwide network for many of the country’s outlying cities. “For small businesses and farmers in these areas, loading 25 cars and transporting them 75 miles to the nearest Class I interchange is just as important as the ability to attach that group of cars to a 100-car train and move it across the country,” says the Association of American Railroads.
Class II and III railroads, which maintain and operate their own infrastructure, act as a feeder to the national-scale distribution system.
These lines also participate in the organization of passenger transportation.
Depending on the class, the railroads apply different labor rules. In addition, for example, short lines may rely more on government support because they are socially important to a particular region.