Hunter Harrison at CSX

[gokeefe]

Seems doubtful given the regulatory obstacles now in place to Class 1 mergers.

[Safetee]

interesting piece in transport topics
http://www.ttnews.com/articles/harrison ... rules-2018" onclick="window.open(this.href);return false;

[gokeefe]

The statements about succession seem very unusual given what seemed like an intended long tenure at the outset.

Here's the latest:

The precision scheduled railroading model adopted by CSX’s CEO Hunter Harrison to improve its efficiencies has helped the company make a substantial progress over the last few months. Evidently, its third-quarter 2017 earnings improved 6.3% year over year. Revenues in the period too rose owing to core pricing gains. The 10% increase in coal revenues is also encouraging.

Read the rest of it and you won't see a single word about volumes or car traffic.

My "between the lines" read? They are dumping market share on select lanes in pursuit of greater efficiency and net earnings. The improvements to the bottom line are certainly great for investors but they will ultimately hollow out a railroad which relies on a diversified traffic mix to sustain its services in Eastern terminals and ports.

[mmi16]

Book cooking 1st class!

[gokeefe]

What is even more interesting is the extent to which they admit that this is solely for the sake of delivering cash dividends. There does not appear to be a growth motive in the rail business itself.

[mmi16]

Rape the treasury for Paul Hilal.

[Knucklehead]

Personally, I believe the challenges with publicly-held entities are that they are in business largely to make the shareholders as much money as they can, often at the expense of the customers and consumers they serve.

I recently read that some of CSX's rail lines and business may not be profitable enough and is considered marginal by EHH, and he wants to get rid of the LOWER profit-producing lines. While that is certainly understandable from a purely business perspective, oftentimes the customer (and often, consumer) that often-times depends on rail for lower-cost shipping will suffer, especially if another operator does not grab a particular line that is divested. The customer is then forced to pay higher freight costs, often passing those costs on to the end user/customer. Gone are the days of "customer service" - even though they may be making money on a particular line or commodity, the profit margin is not worth it for the big guys. The only ones that benefit are the shareholder.

[gokeefe]

Gone are the days of "customer service" - even though they may be making money on a particular line or commodity, the profit margin is not worth it for the big guys. The only ones that benefit are the shareholder.

This is where regional Class II railroads do a great job of picking up the slack. If CSX is making money on a given line and wants to divest it I feel very comfortable saying that it will be bought (and operated) by someone else.

[ccutler]

Yes and the customer may be better off on a divested line operated by a short line, than retained under CSX's disinterested and overly-centralized management.

[ExCon90]

Particularly so if the short line, or more likely a regional, happens to connect with NS via one junction and CSX via another. We may again see an alphabet route!

[MattW]

Are you thinking about the Georgia road, ExCon90?

[Gilbert B Norman]

Alphabet Route, Mr. Ex-Con? Now there's a "blast from the past".

Sometime during the '50's TRAINS had an article about the route and how all the railroads coordinated to make it work.

Mr. MattW, the Georgia Railroad was absorbed into the CSX system. I'm not sure to what extent Yäger, or for that matter his predecessors, have downgraded the "Silver Comet" Hamlet-Atlanta (Atl-Bham is a bicycle trail within GA). He may still need GA for an efficient handling of East Coast Atlanta traffic interchanged with NS at Augusta.

[mmi16]

When I worked CSX's Atlanta Division, the Georgia Road was an overflow route for excess traffic on the Fitzgerald Sub. Since then CSX has improved the capacity on the Fitzgerald Sub.

[Gilbert B Norman]

Mr. MMI, from looking at the CSX map, Fitzgerald is on a route connecting WayX and Atlanta. That means if Northeast-Atlanta traffic is anything to Yäger, it must be routed south to WayX then North to Atlanta.

Doesn't sound like "Precision Railroading" to me.

[ExCon90]

Sometime during the '50's TRAINS had an article about the route and how all the railroads coordinated to make it work.

Cooperation was greatly spurred by the knowledge that each railroad had to do its part every day or they all would lose the business; same principle as a relay race--nobody better drop the baton.