JACKSONVILLE, Fla. – CSX CEO Joe Hinrichs sought to rally the troops today as the railroad continues to battle congestion that began in the weeks before a key Baltimore tunnel was closed on Feb. 1 for a long-awaited clearance project.
In a bulletin to employees, Hinrichs touted the railroad’s industry-leading operational and financial performance record over the past few years.
“Things started changing dramatically in the fall of 2024 when two hurricanes greatly disrupted our network, causing much congestion, and taking out one of our north-south routes (Blue Ridge Subdivision). Other weather events hindered our ability to fully recover,” Hinrichs wrote. “We took down the Howard Street Tunnel in Baltimore on Feb. 1 to rebuild it and enable double-stacking of intermodal containers in the near future – a key part of our growth strategy. All of these events, and our own performance, put our network in a less-resilient condition and it has taken us longer to recover than we expected.”
The 16-plus trains that typically used the Howard Street Tunnel every day are being detoured, some of them on the roundabout route via the former Water Level Route across New York. Among them: Export coal trains bound for the Consol Marine Terminal in Baltimore.
The railroad posted disappointing financial results the past two quarters due to a combination of congestion-related costs, slumping export coal volume, and a decline in fuel surcharge revenue. In the first quarter, CSX’s operating income declined 22%, revenue was down 7%, and earnings per share sank 24% on a 1% decline in overall volume.
“The doubters, who were quieted by our results for the first two years, have returned,” Hinrichs wrote. “We have started to see progress the last few weeks improving the fluidity of our network – yet there is still much work to be done. It is up to us to work together as ONE CSX team to show the world, once again, what we are capable of.”
The latest network data, reported for the week ending April 25, showed CSX was slowly rebounding. The number of cars online declined, train speeds inched up, terminal dwell dropped, and fewer trains were being held for crews.
But trains were still being held out of congested yards. Trains bound for CSX’s busiest hump yard, Rice Yard in Waycross, Ga., for example, are routinely held at terminals in Savannah, Ga.; Florence, S.C.; Rocky Mount, N.C.; and Richmond, Va.
As he did in a similar bulletin a month ago, Hinrichs urged conductors and engineers to pitch in.
CSX is taking several steps to smooth operations, including tapping its locomotive surge fleet, boosting mechanical staffing to speed locomotive servicing, transferring train crews to congested terminals, and temporarily reducing trackwork in the areas hardest hit by congestion.
“I have no excuse as to where we are other than a buildup of a series of significant events that really took away the capacity that we had planned once we took down the Howard Street Tunnel,” Chief Operating Officer Mike Cory said on the railroad’s earnings call last month.
Almost a century ago the PRR proffered a plan for a new B&P tunnel with capacity to include room for the B&O. NOW Amtrak and CSX are playing catch up. Learn the history this (and other things that didn’t happen), learn how railroads went sideways in the 20th century.
PSR disciples like Hinrichs and his ilk have cut the class 1s to the bone, firing one third of the workforce (and keeping threadbare). There is no resilience or redundancy of workers, equipment or capacity. PSR has been meticulously planned and executed. Taking the Howard Street Tunnel out of service was not an act God; the disastrous results are simply inadequate planning and manpower for a completely foreseeable circumstance. The results are simply executive and management incompetence.
CSX workers should take all their allotted days off and vacation. Maybe management will get that memo about “teamwork”.
But rest assured, smiley-faced, baby-kissing Joe with his denim CSX shirt will still get his 8 figure paycheck. Failure has no consequences for executives and the elites.
I always flinch at this type of Rah-Rah, “If we all flap our arms hard enough, we’ll fly!” management PR. How many employees really have any control over expediting things?
None as a matter of fact if you try to go above and beyond someone in the organization will find some fault in your work and try to discipline you. There’s no room for get up and go in the class one organizations, the rule book and weed weasels will not allow it.