Posts Tagged ‘Waycross Georgia’

CSX to Keep 4 Humps, Unload Some Trackage

May 24, 2018

CSX plans to keep four hump yards but is reviewing other “underused” facilities, including 8,000 miles of trackage that may be abandoned or sold.

CEO James Foote disclosed the plans during a speech to the Wolfe Research Global Transportation Conference.

“We’re doing a good job of analyzing about 8,000 miles of railroad and trying to determine what segments fit into  . . . three baskets,” Foote said.

He identified those are core and non-core routes, and lines that are somewhere in the middle and need further analysis to determine whether they should be retained or spun off.

The hump yards that CSX plans to keep open for now are located in Waycross, Georgia.; Selkirk, New York; Indianapolis (Avon); and Cincinnati (Queensgate).

Foote said Waycross and Selkirk are anchors in their regions of the CSX network.

Avon and Queesgate have been processing cars at record levels. CSX briefly closed Avon Yard as a hump and talked about moving its yarding duties to smaller yards in Indianapolis but backed away from those plans after its network became congested.

CSX will continue to seek to consolidate underused local switching and support yards in an effort to find more efficiency gains.

Foote contended that railroad’s financial goals for the next three years are not necessarily contingent on selling off routes.

One of those objectives is to have a 60 percent operating ratio which is the percent of revenue that is being devoted to operating expenses.

“This is not something that was in the plan that says if we don’t do this we can’t hit a 60 operating ratio,” Foote said. “This is totally separate and independent. And again to a large degree, it goes back to learning, understanding the complete footprint of the CSX network and how it should be most efficiently and effectively run.”

The financial plan, which governs operations through 2020, calls for cost-cutting, efficiency gains and revenue increases.

This include selling real estate, which is expected to net $300 million. The plan also identified $500 million in potential line sales.

CSX said it is talking with numerous would-be buyers who have expressed interest in routes the Class 1 carrier might be willing to sell.

The carrier has said it doesn’t have a target number for how many miles it wants to sell or abandon.

Chief Financial Officer Frank Lonegro said that management recently held an “intense dialogue” about core and non-core routes with the company’s board or directors.

Lonegro said management outlined what routes were considered part of the core and which lines no longer fit into CSX’s plans.

“Precision scheduled railroading has clearly given us the opportunity to look more at redundant routes and branch lines that don’t carry very much traffic,” he said.