CSX's CFO jumps ship!
https://www.progressiverailroading.com/csx_transportation/news/Lonegro-departs-CSX-Boone-named-interim-CFO--57669
Never too old to have a happy childhood!
Surely with the problems being prolonged this long, Becky is getting black and blue by now...
And now, CSX says its manifest traffic is growing because of BETTER service. Is this disproving all the hand wringing over the negative effects of PSR? Could all the naysayers be wrong? Or is CSX doing something right? Please tell me.
Electroliner 1935 And now, CSX says its manifest traffic is growing because of BETTER service. Is this disproving all the hand wringing over the negative effects of PSR? Could all the naysayers be wrong? Or is CSX doing something right? Please tell me.
If CSX's service levels are so great, then why are their YTD intermodal units down 6.4%, while NS' are up 0.6%? And CSX's comps are more favorable than NS'! Manifest traffic is far less sensitive to service levels (good or bad) than intermodal is.
Want to know CSX's real secret as to why their service metrics are so high? Their 1st quarter 2019 revenue ton-mile stats are lower than they were in 2016 (50.4 billion vs. 51.2 billion, respectively). They are the only Class I railroad with negative revenue and gross ton-mile growth between 2016 and 2018. Dwell time and average train speeds improve amazingly well when you empty out the railroad.
ns145 Electroliner 1935 And now, CSX says its manifest traffic is growing because of BETTER service. Is this disproving all the hand wringing over the negative effects of PSR? Could all the naysayers be wrong? Or is CSX doing something right? Please tell me. If CSX's service levels are so great, then why are their YTD intermodal units down 6.4%, while NS' are up 0.6%? And CSX's comps are more favorable than NS'! Manifest traffic is far less sensitive to service levels (good or bad) than intermodal is. Want to know CSX's real secret as to why their service metrics are so high? Their 1st quarter 2019 revenue ton-mile stats are lower than they were in 2016 (50.4 billion vs. 51.2 billion, respectively). They are the only Class I railroad with negative revenue and gross ton-mile growth between 2016 and 2018. Dwell time and average train speeds improve amazingly well when you empty out the railroad.
If Lonegro had any remaining self respect - it is no wonder he jumped the CSX ship with what Foote is reporting.
Regarding the article:
On the face of it, analyst Rick Paterson seems to imply that the penny pinching, a derogatory term, is caused by PSR. He says this: “The problem is that Class I railroads, mindful of Wall Street’s focus on the operating ratio, try to perfectly match crew and power resources with their current traffic levels, Paterson says. And that leaves railroads with no margin for error.”
Thus, at first glance, he seems to be referring to Wall Street conspiring to get a foothold in the management of a railroad to cut cost and loot the savings for the gain of investors, as has been discussed continuously on this forum. And that also seems to be the thrust of this thread.
But I don’t think he is saying that. Instead, he sees the perfectly matching of crew and power resources with traffic levels as a good thing for the company rather than a damaging theft of company wealth. However, he does caution that this precise matching of crews to traffic can leave an operation too lean, and thus unable to cope with sudden contingencies such as severe weather events.
Then he offers an example of climate change potentially causing the kind of upheaval that sneaks up on “railroads with no margin for error.”
But then, he says this: “PSR railroads are more resilient and have provided the most consistent service, Paterson says, singling out Canadian Pacific as the steadiest performer."
Then the problem becomes what do they do whenever a flooding event like today happens. The BNSF lost both the old Santa Fe and and BN lines west of Galesburg to flooding in both Iowa and Missouri. What do you think a PSR railroad can do when they have cut everything to the bone. BNSF already has repaired or replaced the lost track on the Santa Fe and the old BN is expected up tomorrow. Why they have the resources to power through multiple issues that CSX or CP can't stand up to anymore in manpower.
Shadow the Cats ownerWhat do you think a PSR railroad can do when they have cut everything to the bone.
Well, I don't think they should cut everything to the bone. Neither does the person who is featured in the article. Apparently he believes that PSR is a good thing, and that it does not require cutting everything to the bone, even though some companies may do that. He advises that companies do not spread themselves too thin precisely because they need reserves to stand up to climate related emergencies.
My point is that when I first started reading the article, I thought the person quoted was going to rip into PSR. But he is actually in favor of it.
EuclidMy point is that when I first started reading the article, I thought the person quoted was going to rip into PSR. But he is actually in favor of it.
I would opine that PSR, in and of itself, isn't necessarily a bad thing. The problem has been that it's been tainted by the hedge funds, etc, who seem to think that if getting rid of one of something is a good idea because it saves money, then getting rid of two must be even better, even if that's the spare that's going to bail you out when things go sour.
Larry Resident Microferroequinologist (at least at my house) Everyone goes home; Safety begins with you My Opinion. Standard Disclaimers Apply. No Expiration Date Come ride the rails with me! There's one thing about humility - the moment you think you've got it, you've lost it...
Shadow the Cats ownerThen the problem becomes what do they do whenever a flooding event like today happens. The BNSF lost both the old Santa Fe and and BN lines west of Galesburg to flooding in both Iowa and Missouri. What do you think a PSR railroad can do when they have cut everything to the bone. BNSF already has repaired or replaced the lost track on the Santa Fe and the old BN is expected up tomorrow. Why they have the resources to power through multiple issues that CSX or CP can't stand up to anymore in manpower.
There is only one recourse to the damage Mother Nature inflicts on a railroad - be that rain or snow - MANPOWER in mass quantities. Without massed manpower, Moms' Nature put the carrier down for the count in a world where time is money.
PSR in Nature times raises cost exponentially - contractors don't come cheap, especially when they know they have you by the attachments. So in addition to the cost of repairing damage there is the cost of a stopped rail line.
BaltACDPSR in Nature times raises cost exponentially - contractors don't come cheap, especially when they know they have you by the attachments. So in addition to the cost of repairing damage there is the cost of a stopped rail line.
zardoz BaltACD PSR in Nature times raises cost exponentially - contractors don't come cheap, especially when they know they have you by the attachments. So in addition to the cost of repairing damage there is the cost of a stopped rail line. Those expenses go in a different accounting column, therefore they are not shown counting against the PSR 'savings'.
BaltACD PSR in Nature times raises cost exponentially - contractors don't come cheap, especially when they know they have you by the attachments. So in addition to the cost of repairing damage there is the cost of a stopped rail line.
Those expenses go in a different accounting column, therefore they are not shown counting against the PSR 'savings'.
No matter how you internally allocate the expenses - they all end up in the bottom line. Of course the Hedge Fund theives will take theirs off the top.
No matter how you try and change how you account for the costs it all has to come out of that same revenue stream. The only saving factor if your using a contractor is when they are not doing anything for your company your not paying them. However when they are the costs add up fast. Hedge funds forget that for every dollar going out there needs to be more than that coming in.
BaltACD Without massed manpower, Moms' Nature put the carrier down for the count in a world where time is money. PSR in Nature times raises cost exponentially - ...
Without massed manpower, Moms' Nature put the carrier down for the count in a world where time is money.
PSR in Nature times raises cost exponentially - ...
Regardless of how railroads account for extreme weather costs, Rick Paterson, in the linked article, says that railroads with PSR recover from weather setbacks quicker than railroads without PSR.
From the article based on ideas of Rick Paterson:
“CSX is arguably the best-running railroad in North America right now,” Paterson says, noting that the CSX service composite is currently 41% higher than its historic average. “Hunter Harrison cuts the merchandise network over to PSR without apparently telling anybody, including his own operating people,” Paterson says. “But as usual, he was right and everything worked out and all was forgiven.” PSR railroads are more resilient and have provided the most consistent service, Paterson says, singling out Canadian Pacific as the steadiest performer. Service suffered at all of the Class I railroads during the frigid winter of 2013-14, Paterson notes, but since then the non-PSR railroads experienced deeper, more prolonged, and more frequent service problems. It’s good news that six of the seven Class I railroads are adopting PSR, Paterson says. After a pair of hurricanes last year, for example, CSX bounced back quickly while NS velocity sank to its lowest levels since the meltdown after the Conrail split two decades ago.”
Euclid BaltACD Without massed manpower, Moms' Nature put the carrier down for the count in a world where time is money. PSR in Nature times raises cost exponentially - ... Regardless of how railroads account for extreme weather costs, Rick Paterson, in the linked article, says that railroads with PSR recover from weather setbacks quicker than railroads without PSR. From the article based on ideas of Rick Paterson:
Who?
Really they do. BNSF had 2 major mainlines washed out 2 days ago in Iowa and Missouri one on the Owattuna Subdivision the other on the Marcilne Subdivison. Both are already repaired and back in service. UP is still struggling to put the KC to St Louis line back into service. BNSF is not a follower of PSR UP is.
BaltACDYou get what you pay for - that goes to both the customer and to the company that employs the work force. Customers always think they get overchaged and company's always think their work force is over paid. What a pyramid to build good customer relations upon!
Customers always think they get overchaged and company's always think their work force is over paid.
What a pyramid to build good customer relations upon!
- PDN.
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