CSX Executive Says Overhaul of Intermodal is Complete

A CSX executive said this week the carrier has completed making major changes to its intermodal operations and is now looking for business growth opportunities.

Speaking at the annual Intermodal Expo of the Intermodal Association of North America, Maryclare Kenney, vice president of intermodal and automotive at CSX, said the carrier is now able to provide more reliable service.

“We’re looking to grow,” Kenney said. “We’re open for business and we’re excited by the consistent, reliable service we’re able to bring customers.”

CSX overhauled its intermodal network soon after adopting the precision scheduled railroading operating model.

One major change was to end the hub and spoke business model that involved the Northwest Ohio Intermodal Terminal, which CSX had used as a sorting hub for containers brought in from various points on its system.

Low volume intermodal service lanes were closed, resulting in a 15 percent drop in intermodal volume over the past two years.

Intermodal volume this year at CSX is down 8 percent. Overall North American intermodal volume thus far in 2019 has fallen by 4 percent.

Kenney said that before implementing PSR two years ago CSX had periods of time when it delivered good service but had challenges maintaining consistent, reliable service.

She attributed that in part to a complicated intermodal network.

“We were trying to be all things to all people, serve every lane that somebody wanted us to serve, and we really didn’t think about the volume and density that was required to really make you successful in railroading,” Kenney said.

CSX now emphasizes a high-density point-to-point intermodal network of higher density and more profitable lanes.

Kenney said that combined with the efficiencies of PSR have enabled CSX to improve its service reliability.

In previous years, CSX measured intermodal on-time performance by whether it delivered within four hours of scheduled arrival. The best it achieved under that standard was a 90 percent on-time performance.

Currently, CSX measures on-time performance to the minute based on a trip plans for each container and trailer.

The carrier said that it has achieved 93 percent on-time performance in the third quarter of this year, which it said was a 20-point improvement since the second quarter of last year.

Kenney said that on some days Intermodal trip-plan compliance has been 99 percent.

As for expansion plans, CSX and Canadian National will launch next month a new joint intermodal service connecting Toronto and Montreal with New York, New Jersey, and Philadelphia.

CSX and BNSF have haulage agreements that involve use of the Northwest Ohio terminal in North Baltimore. Containers originate on BNSF in California and are unloaded in North Baltimore.

Tom Williams, BNSF’s group vice president of consumer products, said at the conference that additional origination points are likely to be added.

The North Baltimore terminal is now used to serves local markets.

Kenney declined to comment on whether CSX and Union Pacific are planning to revive some of their discontinued interline services.

There have been trade press reports that intermodal marketing companies had received inquiries from the railroads to determine if there was interest in resuming some of those discontinued services.

Kenney would only say that CSX continues to evaluate its network and that interline services will continue to evolve.

Although international intermodal service from Southeastern ports to inland ports has seen robust growth, Kenney said the overal trend is negative for railroads because intermodal captures far less international volume from East Coast ports than it does from West Coast ports.

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