Archive for the ‘Railroad News’ Category

CSX Responds to Harrison Moves

January 21, 2017

CSX responded to news reports that E. Hunter Harrison may seek to oust current CSX management by issuing a statement that supported the company’s current executive team and its strategies.

CSX logo 3A CSX spokesman said in the statement: “CSX Corp. welcomes the views of all of our shareholders and always considers their thoughts on the company’s business strategy. Likewise, its board and management team remain supportive of the company’s strategic growth strategy, which has started to deliver sustainable value for shareholders.

“The company and its board of directors will actively evaluate Mantle Ridge’s views and look forward to discussing our core strategy to continue driving earnings growth and shareholder value going forward with Mantle Ridge and all our shareholders.”

The statement referred  to reports that Harrison is retiring from Canadian Pacific earlier than planned and has teamed up with venture capital firm Mantle Ridge to seek to oust CSX CEO Michael Ward.

Harrison would, presumably, become the CEO of CSX and install his own management team.

 

 

R.J. Corman Makes Personnel Appointments

January 21, 2017

Nathan Henderson has been named president of R. J. Corman Railroad Services while Noel Rush was appointed senior vice president commercial development.

CormanHenderson joined Corman in January 2011 after 14 years at CSX. He has served in several leadership roles, including holding the post of vice president of material sales, vice president of strategic sales and marketing, and as chief commercial officer.

He will oversee daily operations and development of the railroad services company, which offers railroad construction, emergency response and maintenance-of-way services.

In addition to focusing on customer service, Henderson said he would “emphasize the company’s overall operating efficiency and work toward ongoing expansion, while keeping safety as our priority.”

Rush previously served as president of R. J. Corman Derailment Services, vice president of finance and administration, and vice president of risk management.

He will be responsible for developing the company’s corporate marketing strategies, client services, executive relationships and government affairs.

Both Henderson and Rush will continue to report to R. J. Corman President and Chief Executive Officer Ed Quinn.

New Buffalo Station Discussed at Public Hearing

January 20, 2017

The public is now getting a chance to weigh in on where the new Amtrak station for Buffalo, New York, should be located.

Amtrak 4The first public meeting to gather public opinion was held Thursday (Jan. 19) at Buffalo City Hall.

In the meantime, a committee headed by Mayor Byron Brown expects to be done by April studying where to locate the new station.

“The clock is ticking,” said Robert Shibley, dean of the University at Buffalo School of Architecture and Planning and the lead facilitator for the station site selection process.

Shibley said the committee is still getting organized, but consulting firm Parsons Brinckerhoff is already gathering information about the matter.

“They are essentially charged with answering the questions that need data support to make a good decision,” Shibley said.

Some information will come from Amtrak station policy documents and past studies conducted by CSX, Amtrak and the Niagara Frontier Transportation Authority.

“As a starting point, the engineering firm is using a list of potential train sites from various reports,” Shibley said.

Canalside has been frequently mentioned as a possible station site due to its location near to the existing Exchange Street station. But also in the mix is the dormant Central Terminal and a site in Larkinville.

The State of New York is providing $1 million for the station study work with the proviso that it be completed within six months from last October.

Harrison Eyes Taking Over CSX as CEO

January 19, 2017

E. Hunter Harrison is back in the takeover game and setting his sights on wresting away control of CSX from current CEO Michael Ward.

E. Hunter Harrison

E. Hunter Harrison

The Wall Street Journal reported this week that Harrison, who fought an unsuccessful bid in early 2016 to acquire Norfolk Southern, has teamed up with Paul Hilal, a principal at hedge fund Mantle Ridge, to prod CSX to make a management change.

Hilal was formerly with Pershing Square Capital. The latter is run by William Ackman, who played a key role in getting Harrison named CEO at Canadian Pacific in 2012 after winning a proxy fight.

Harrison, 72, this week said he is severing his ties with CP before his official retirement from the company.

He will be succeeded at CP by Keith Creel, effective Jan. 31. In the interim, Harrison is reported to be on vacation and Creel will assume Harrison’s duties.

Harrison has agreed to sell all of his shares of CP stock by May 31 and the CP board of directors agreed to provide him with a limited waiver of a non-compete clause to which he would otherwise be subjected.

In return for waiving the non-compete clause, Harrison will forgo all roles he had with CP and give up substantially all benefits and perquisites to which he was entitled. The total value of those forfeited benefits is $89 million.

The CSX takeover attempt would be Harrison’s second. CSX rejected his overtures in 2014.

The WSJ reported that CP will not participate in any effort that Harrison makes to gain control of CSX.

Hilal left Pershing Square last year to start his own activist fund, which has raised more than $1 billion for a single investment, according to the WSJ. Those investors reportedly have committed to keeping money in the fund for five years.

Harrison became the CEO of CP after Ackman led a proxy fight that resulted in the ouster of CP CEO Fred Green.

If Harrison and Hilal follow that same script at CSX, they will seek to oust Ward, who has indicated he plans to retire in 2019.

Hilal was with Pershing Square at the time of the CP takeover and recruited Harrison, who had been CEO of Canadian National.

Railway Age magazine quoted Cowen and Company Managing Director Jason Seidl as observing, “Hunter left C$118 million in equity awards on the table, which indicates to us he still has a burning desire to run a railroad. His reputation of being the most sought after manager in the North American railroad industry could make it very difficult for CSX to refute Harrison’s desire to run its franchise.”

Seidl told Railway Age that a CSX takeover would differ from what Harrison attempted at NS because the latter involved a merger whereas the CSX gambit would be just a management switch.

Railway Age quoted an unnamed railroad industry analyst as predicting that if Harrison is able to become head of CSX a merger with CP will not likely be one of his first priorities.

The analyst said that Harrison could be expected to change the CSX engineering, train operations and capital investments plans that Ward’s management team has been implementing over the past year.

Given Harrison’s track record, the analyst expects that he would impose at CSX a more aggressive capital expenditure downsizing and reduce its labor force.

Harrison would not be likely to institute more aggressive marketing and selling promotions, but would oversee creating more discipline in CSX train operations.

CSX 2016 4th Quarter Earnings Fell 2%, But Revenue Up 9% When Compared with 2015

January 19, 2017

CSX said this week that its 2016 fourth quarter net earnings fell by 2 percent to $458 million, or 49 cents per share.

CSX logo 1That compares to $466 million, or 48 cents per share that it earned in the fourth quarter of 2015.

Fourth quarter 2016 revenue was up by 9 percent to $3 billion compared with $2.78 billion a year ago.

CSX said that factors affecting its fourth quarter performance included an operating property sale and a debt refinancing charge, both of which were $0.08 per share and offset each other in the quarter.

The final quarter of 2016 also included an additional accounting week resulting from the company’s 52/53 week fiscal reporting calendar, which benefited earnings per share by $0.03 per share.

CSX said expenses increased 2 percent while operating income was $1 billion, which included the $115 million gain from the property sale and the $62 million benefit from the extra week.

During 2016, “the industry continued to face headwinds from low global commodity prices and strength of the U.S. dollar,” CSX said in a news release

For CSX this meant that it generated $11.1 billion in revenue as volume declined 5 percent overall with a 21 percent decline in its coal traffic.

Earning per share for 2016 were $1.81, operating income was $3.4 billion and the railroad posted an operating ratio of 69.4 percent.

“In an environment where the company lost almost $470 million of coal revenue and experienced weakness across most of its markets, CSX delivered nearly $430 million of productivity savings in 2016, while improving customer service,” said CEO Michael J. Ward in a statement. “With business conditions gradually improving and the ongoing transformation into the CSX of Tomorrow, we will continue to deliver sustainable shareholder value.”

Reading & Northern Building New Station

January 19, 2017

The Reading & Northern will build a new passenger station near the Reading, Pennsylvania, city limits.

PennsylvaniaThe $2 million project also will include construction of a siding from the main line, a water tank and a home for Canadian Pacific 225, a 4-6-0 formerly owned by the late George M. Hart. The 225 will be displayed at the site.

The R&N acquired the property for the station in 2016 for $895,000. It is located along Pennsylvania Route 61 in Muhlenberg Township north of a connection with Norfolk Southern.

To prepare the site, a closed strip mall and restaurant on the property were razed.

The new station will feature a Victorian era design and simulate a station known as the Outer Station that was located closer to central Reading.

That station was constructed in 1874 and located within a wye of lines branching off to Allentown, Pottsville, Harrisburg and Philadelphia.

The Outer Station, which had division offices, closed in 1969 and was destroyed by fire in 1978.

The railroad also had a passenger station in downtown Reading on Franklin Street.

The R&N said that it will begin offering scheduled Saturday passengers trains between the new station and Jim Thorpe, Pennsylvania, on Memorial Day, using former Reading rail diesel cars.

The route of the service will be ex-Reading rails from from Reading to Hauck on the Catawissa Branch and then over the former Jersey Central Nesquehoning Valley Branch to Jim Thorpe. The trip will be 60 miles one way.

Paducah & Louisville Names New Executives

January 19, 2017

The Kentucky-based Paducah & Louisville Railway announced this week the promotion and appointment of several executives.

paducah-and-louisvilleTim Wyatt has been named vice president of transportation of labor and will oversee all transportation department operations, dispatching, customer service and labor relations.

He has been with P&L since 2003 and has worked in the railroad industry since 1984.

Kevin McEwan was tabbed to be vice president of marketing and sales where he will be responsible for marketing, sales, pricing, and industrial development. He has been with P&L since 2006, most recently as its marketing director.

Chris Reck will become assistant vice president of sales and industrial development with responsibility for all outside sales and industrial development. He has been with P&L since 2007, serving in positions ranging from conductor to marketing director.

Aside from its flagship railroad in Kentucky, the P&L also manages the Evansville Western Railway in Indiana and the Appalachian and Ohio Railroad in West Virginia.

CVSR Set Ridership Record in 2016

January 18, 2017
cvsr-july-23-16-x

A southbound CVSR Scenic train arrives in Peninsula last summer.

It was a record-setting year for the Cuyahoga Valley Scenic Railroad in 2016.

Overall ridership was a record 214,063 while the National Park Scenic enjoyed record patronage of 117,478.

CVSRThe Bike Aboard! program also set a record with 23,911 participants.

The previous overall ridership record was 210,347 in 2012. Since then, ridership has been in the range of 186,000 to 185,000.

Although not setting any records, The Polar Express carried more than 42,000 in 2016. Traditionally, it has accounted for 20 percent of the CVSR’s annual ridership.

“The staff and volunteers of CVSR are pleased that so many people chose our trains as a way to experience Cuyahoga Valley National Park,” said Kim Gillan-Shafron CVSR vice president-marketing & community alliances in a news release.

Aside from viewing the scenery of the Cuyahoga Valley National Park, the CVSR offers various theme trains, including a few new ones in 2016.

Aside from the long-standing dinner trains, and beer and wine tastings fare, the CVSR hosted Read Aboard, the first summer reading program aboard the train; Royalty on the Rails and the Superhero train, excursions for children to meet and greet with their favorite characters on the train.

The CVSR began operations in 1975 as the Cuyahoga Valley Line. It suspended operations in 1986 and 1987 after CSX abandoned the tracks used by the CVL between Akron and Independence.

The National Park Service subsequently bought the rails used by the CVSR and has invested more than $30 million into improving and maintaining the railroad’s infrastructure.

CSX, NS to Increase Inward Facing Cameras, Do More Cell Phone Detection Inside Locomotives

January 18, 2017

CSX and Norfolk Southern expect to increase the number of inward facing cameras in their locomotives this year and to install cell phone detection technology.

train image2Trains magazine reported this week that it obtained a CSX employee bulletin that gave a general outline of the railroad’s plans.

The cell phone detector device will only detect devices that are turned on and available to a cellular network.

Reportedly, the device will not seek to detect phones turned off or placed in “airplane mode,” meaning they cannot connect to a cellular network or the Internet.

A CSX spokesperson told Trains that the use of cameras and cell phone detection devices is for safety reasons.

An NS spokesperson also told the magazine that it will install more cameras this year and increase the number of locomotives equipped with cell phone detection devices.

Supreme Court Declines to Hear W&LE Appeal

January 18, 2017

The Wheeling & Lake Erie has been rebuffed by the U.S. Supreme Court in its bid to have overturned  a federal appeals court decision that the use of managers in place of union conductors during a strike is a major dispute under the Railway Labor Act.

W&LE logo 2The conflict dates to September 2013 when the Brotherhood of Locomotive Engineers and Trainmen authorized a strike after the W&LE reportedly ignored a collective bargaining agreement that the union argues prohibited single-person operations.

The union argued that the Wheeling disregarded a longstanding crew consist agreement calling for the assignment of an engineer and a union conductor.

For its part, the Wheeling contended that the strike was illegal. It obtained an injunction from a federal district court ordering the BLET members to go back to work. That court described the disagreement as a minor one that should be submitted to arbitration.

However, a three-judge panel of the U.S. Court of Appeals for the 6th Circuit reversed the lower court decision and remanded the case back to the district court with instructions to dismiss the W&LE’s complaint.

In a news release, BLET said the appeals court ruling meant that the railroad’s “claim that the trainmen agreement allowed it to man trains without union conductors is frivolous or obviously insubstantial, and the dispute is major.”

The full appeals court declined the Wheeling’s request to overturn the decision of the three-judge panel.

The Supreme Court said on Jan. 9 that it would not review the appellate court ruling.

In commenting on the legal wrangling, the BLET said the outcome means that if the W&LE wants to change work rules it must do so through collective bargaining.