Posts Tagged ‘transportation conference’

CSX Says On-Time Performance is Up 52%

May 19, 2017

A CSX executive this week touted improving performance metrics over the past two months, including a 52 percent improvement in on-time performance.

“We’re at the beginning of an amazing transformation,” CSX Chief Financial Officer Frank Lonegro said at the Bank of America Merrill Lynch 2017 Transportation Conference.

Lonegro said train velocity has risen by 14 percent and terminal dwell time has fallen by 11 percent.

On-time originations rose 16 percent to 91.6 percent while on-time arrivals jumped to 87.6 percent from just 57.8 percent.

Lonegro largely credited the improving metrics to new CEO E. Hunter Harrison’s precision scheduled railroad operating philosophy.

Harrison has been at CSX for 10 weeks. “He really has hit the ground running and has begun to implement precision scheduled railroading across our railroad,” Lonegro said.

During his presentation, Lonegro said CSX has become more efficient by hauling the same amount of tonnage on fewer trains.

Although its revenue-ton miles have held steady while the active train count has fallen by 15 percent, Lonegro said that will continue to improve.

He said CSX is creating a train plan that keeps terminals fluid and reduces the need for handling en route.

“Hunter’s philosophy is move the freight as far as you can as fast as you can and touch it as few times as you possibly can,” Lonegro said.

One highly visible change at CSX has been a reduction in hump yards. That is at odds with how CSX has operated.

“At CSX historically we have been a big believer that the most efficient way to class[ify] traffic is through a hump yard,” Lonegro said. “Hunter has totally debunked that.”

CSX has converted hump yards in Toledo, Ohio; Louisville, Kentucky; Hamlet, North Carolina; and Atlanta to flat-switching.

Reports have surfaced that yards in Cumberland, Maryland; and Selkirk, New York, will also lose their humps.

Lonegro said CSX is evaluating its eight remaining hump yards and expects to convert some to flat switching in the second quarter of this year.

In doing this, CSX has changed is operating plan so that traffic bypasses the yards except for cars destined for that location.

CSX will likely have between two and four active humps by the time the evaluation process is completed.

Lonegro also reported that CSX has stored 551 locomotives and parked, scrapped, or returned more than 22,000 freight cars.

He said the operating changes have thus far not prompted shippers to shift their business to Norfolk Southern.

“We’re really not seeing any market share shifts,” Lonegro says, although he acknowledged that there is a potential for service missteps that could anger some shippers.

Nonetheless, he said CSX expects to satisfy customers by providing faster transit times, improved on-time performance, and better cycle times of freight cars.

The better service and lower costs, he said, should enable CSX to grow its business, particularly at the expense of trucks.

Advertisements