A mathematical modeling approach to improving locomotive utilization at a freight railroad

Moving freight by rail remains one of the major transportation modes in today's business world. Although railcars compare unfavorably with trucks and airplanes with respect to mobility, flexibility, and speed, the shipping costs are lower and the energy-efficiency is higher. In order to become more competitive in the logistics industry, railroads have taken a number of new initiatives to improve their operations in recent years. One of such efforts made by Consolidated Rail Corporation (Conrail) is described in this paper. The main focus of the present study is on helping Conrail increase the utilization of its locomotive fleet by developing a mixed integer linear program (MILP) to determine the least-cost plan of allocating locomotives to yards and moving light engines between yards. The MILP is tested on a set of real data gathered at Conrail and it is proven to be superior to the existing method. A simple sensitivity analysis is also performed to gain insight into the trade-off between investment in additional locomotives and cost of light engine moves.