And freight operations guru Hunter Harrison appears to be destroying CSX Railroad in order to save it.
From Indianapolis comes word today that CSX decided against closing Avon Yard and moving its work to Hawthorne Yard. Hawthorne had been the finest yard on the Pennsylvania Railroad—in 1910. It was in sad shape before CSX spent millions recently to make it partially viable. Now the decision is to keep Avon open, just to shut down its hump yard later this week and flat switch cars. Earlier, a bevy of locomotives had appeared at Avon, assigned to empty yard tracks and haul everything to other yards, such as Louisville, Cincinnati and Willard, Ohio. Customers may get those cars in a week or two.

Three investment analysts have polled CSX customers since the start of last week. With each survey, the percentage of CSX customers who say they are diverting business grows. The most recent to report was Jason Seidl of Cowen & Company. He says half of the customers not captive to CSX are handing off carloads to rival Norfolk Southern. What really struck me was the anger that customers expressed to Seidl about CSX. A sample: “Service has declined to the point that it appears CSX is trying to drive my plant out of business. I have missed customer orders and been forced to idle my plant numerous times due to failure to get service. The only answers we get are basically, ‘That’s tough. Get used to it.’ The situation is untenable, and I am actively looking to switch my business elsewhere wherever possible, as soon as possible.”

Heard enough? As of last week, the only portion of CSX that seemed to operate normally and close to scheduled times was across the Water Level Route in upstate New York, between Buffalo and Selkirk. Today?
Perhaps it's possible to cut your way to prosperity, although the stockholders are going to have to be patient.  Or perhaps CSX is too much a jumble of railroads for anyone to make sense of.

1 comment:

David Foster said...

Doesn't sound good. I've already sold most of my CSX stock, but guess I need to think about getting rid of the rest of it.