CSX Transportation runs with Hunter’s playbook

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NEW YORK — CSX Transportation is still E. Hunter Harrison’s railroad.

CSX executives made that clear during the March 1 investor day, when they aimed to convince Wall Street that they can follow through on the late chief executive’s blueprint for the company.

Harrison left an indelible mark on the railroad’s operations and culture in his 10 months on the job, the executives say.

And while they may tweak some of Harrison’s changes — a handful of mothballed local yards have been put back in service, and distributed power has been added to coal trains so they don’t have to double grades — members of the operations team say they’ve learned and fully embrace Precision Scheduled Railroading.

CSX is following the key tenets of Harrison’s operating model. These include moving tonnage on fewer, longer trains that run every day in both directions, minimizing car handlings en route to save time and money, and launching trip plans for every carload.

Harrison idled the humps at eight of the railroad’s 12 hump yards in 2017 and converted them to flat-switching facilities.

The hump at Tilford Yard in Atlanta — which James Foote ordered razed in his first act as chief executive in December — was no longer necessary, says Jermaine Swafford, senior vice president and chief transportation officer.

Of the 1,200 cars sent over the hump at Tilford every day, only 200 of them were bound to or from Atlanta-area destinations. Now local yards handle those 200 cars, while the other 1,000 bypass the yard.

"Hump yards are places cars go to die," says Jamie Boychuk, vice president of Precision Scheduled Railroading implementation.

Traffic moving from Chicago to Waycross, Ga., used to be classified at hump yards in Cincinnati, Nashville, Tenn., and Birmingham, Ala. Now it runs directly from the Windy City to the hump at Waycross, cutting transit time to 56 hours from 128.

"That's the power of Precision Scheduled Railroading," says Boychuk, a fourth-generation railroader and Canadian National veteran.

The faster transit times mean the railroad can use fewer locomotives, cars, and crews, which substantially reduces operating and capital costs.

CSX officials acknowledge the service failures that occurred last summer due to Harrison’s rapid rollout of the new operating model, which Foote described as “carpet bombing” the network. But they say the railroad is on the mend and service will continue to improve.

“A lot of our customers are just starting to see the tangible benefits of Precision Scheduled Railroading,” says Michael Rutherford, vice president of merchandise sales and marketing.

CSX’s balanced train plan — running equal numbers of trains in each direction, every day — reduces costs by keeping crews and power in the right places, Boychuk says.

The railroad used to make daily decisions on whether volume was sufficient to run a train on a particular day, and annul the train if there wasn’t enough traffic.

“Some people think that’s a savings. But it’s not,” Boychuk says, because it requires unproductive deadhead moves of locomotives and crews.

Balancing the train plan also has allowed CSX to begin meet-and-turn crew arrangements, Swafford says. This reduces crew lodging costs while allowing them to sleep in their own beds every night.

Harrison also ordered other changes to help speed up the railroad, says Bob Frulla, senior vice president of network operations.

Harrison called Frulla one day to ask why CSX would stop its Chicago-Jacksonville, Fla., hotshot intermodal train, Q025, to refuel mid-route. Frulla told Harrison that it was 1,080 miles from Bedford Park terminal in Chicago to the Duval ramp in Jacksonville — and that the train would only make it 1,000 miles without refueling.

It would be faster, Harrison insisted, to top off the locomotives’ fuel tanks in Bedford Park. Frulla gave crews the order. But he also wanted an insurance policy, so he sent a pair of units north from Jacksonville to meet the Q025 in case it ran out of fuel. It wasn’t needed: The train arrived in Jacksonville with 300 gallons in each tank.

The upshot? CSX has eliminated 250 fueling events across the network. This helps cut transit times, Frulla says, while allowing CSX to reduce its fuel inventory, which saves money.

All CSX dispatchers will be moved to Jacksonville by the end of the month, Frulla says. Having one dispatching center improves coordination and keeps trains rolling.
If a train is late, one supervisor can monitor the situation and see that steps are taken to make up time.

“Let ‘em run on green,” Chief Operating Officer Ed Harris says.

Harrison also changed the culture of CSX, which was risk-averse, top-heavy, and structured along the lines of its predecessor railroads.

“Change was not welcome in the company,” says Mark Wallace, executive vice president and chief administrative officer.

And its nine operating divisions behaved as separate companies.

“Right away I realized we needed to integrate this railroad,” Boychuk says.

Consolidating the divisions into four regions streamlines decision-making and has unified the company.

“We’re pulling ourselves as one CSX,” Boychuk says.

Although Harrison crammed years’ worth of operating changes into a few months, there are still opportunities for CSX to continue to find ways to move traffic faster and more efficiently, executives say.

“We’re just getting started,” Swafford says.

The railroad is currently evaluating its 150 or so local service yards to see which might be underused and should be closed, says Amy Rice, vice president of strategic planning. CSX also will pull up sidings under 4,000 feet long, which are obsolete in an era of 10,000-foot trains.
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