NS program targets traffic growth through improved short-line interchanges
6/14/2024
By Jeff Stagl, Managing Editor
Short lines help generate more than 40% of Norfolk Southern Railway’s industrial products traffic annually. So, the Class I’s connections to more than 200 short lines are key links to traffic growth.
But over the past several years, many interchanges between NS and small railroads have been inconsistent, which impacted service performance and jeopardized potential carload growth.
That prompted NS to create the Short Line Performance Project. Launched nearly a year ago, the program is designed to improve communication and information sharing between the Class I and short lines to boost interchange performance.
A Short Line Performance team aims to ensure consistent interchange service via more meticulous carload tracking and real-time communication on traffic exchanges.
The data-driven project started in July 2023 and became a robust program on Jan. 1, 2024, says Stefan Loeb, NS’ vice president of business development and first and final mile markets. The main objective is to improve interchange performance with 40 short lines that pose the greatest opportunities to capture more traffic, he says.
“We have dived in to where we can be more transparent and communicate better, focusing on interchanges where there’s the most growth,” Loeb says.
The Class I wants to provide more resilient service with short lines, while incorporating the small railroads’ point of view in data sharing, says Alex McNeil, NS’ director of short line performance and marketing.
The Alabama and Tennessee River Railway’s traffic has increased by a double-digit percentage in part because of the NS program. The 120-mile short line interchanges with NS in Alabama City, Alabama, and with CSX in Birmingham, Alabama. OmniTRAX Inc.“We did not have the data available of our short line performance, there were gaps. Now, we have bridged that with available data,” he says.
NS and the short lines now share an electronic spreadsheet that includes performance data. The Class I and small railroads use the spreadsheet to describe how well or poorly an interchange was performed, and if their assessments don’t match, the interchange is flagged for further analysis. NS and the program participants also communicate and collaborate via online meetings.
Previously, NS didn’t measure short-line interchange performance or assign someone to monitor interchanges, and short-line complaints were not addressed quickly. The difference now is apparent to many small railroads, especially that NS is trying to be as proactive as possible, says McNeil.
“Short lines can see we are being more responsive and are communicating,” he says.
It’s also apparent in recent NS traffic data that improved interchanges have helped increase carloads. Per a rolling 15-month baseline average for volume, NS’ interchange traffic rose nearly 10% from March 2023 to May 2024 and about 4.6% during 2024’s first five months.
The Class I registered its highest monthly volume in the short-line program in April, and in April’s second week, it recorded the highest weekly volume with short-line interchanges since August 2021.
NS-Delmarva Central Railroad interchanges have been improving. The short line operates 188 miles of track in Delaware, Maryland and Virginia, and interchanges with NS the Maryland & Delaware Railroad in several locations on the Delmarva Peninsula. Carload Express Inc.The top short-line interchanges for volume above baseline involve Watco’s Autauga Northern Railroad (AUT), OmniTRAX Inc.’s Alabama and Tennessee River Railway (ATN), Genesee & Wyoming Inc.’s Alabama & Gulf Coast Railway, and Gulf and Ohio Railways’ Knoxville and Holston River Railroad. For example, total traffic with AUT and ATN has shot up about 31% and 29%, respectively.
OmniTRAX has noted a direct benefit for ATN from NS’ program. The short line has registered double-digit volume growth, said OmniTRAX Chief Commercial Officer Ryan Higgins in an email, adding that the program is a prime example of how collaboration drives efficiency.
“We have always had strong local level collaboration, yet the combined NS corporate and local participation is providing real-time logistics resolution. That’s led to a double-digit increase in interchange consistency, and our customers have shown their appreciation of improved reliability by investing more,” he said. “Service and reliability are vital to rail growth and this timely program is helping the ATN improve both.”
Reliable last-mile service unlocks the power of rail efficiency and brings new customers to rail, he stresses. By prioritizing smoother interchanges, NS can positively impact many current and new rail customers with each successful short-line interchange.
“That has a multiplier effect that benefits everyone. When we collaborate to help rail customers serve more of their customers, everyone wins,” said Higgins.
Carload Express Inc. also is noting benefits from NS’ program for two of its short lines: the Allegheny Valley Railroad (AVR) and Delmarva Central Railroad (DCR).
Those railroads have been part of the program since the beginning, when NS started with only 10 short-line interchanges, says Carload Express President and CEO John Ashbridge. The company’s third short line — the Southwest Pennsylvania Railroad — is expected to enter the program soon.
NS interchanges have always been consistent on the AVR, “so they were strong to begin with and have gotten stronger,” but interchanges on the DCR are more complex, says Ashbridge. Before coming to the AVR, NS trains first travel over the Northeast Corridor, where service-delaying issues can occur, he says.
“We have seen interchange improvements on the DCR. NS is following up to find out what occurred. It’s refreshing — we haven’t seen this before,” says Ashbridge. “If there is miscommunication, they are noting it. They are focused on growth, and short lines are part of that.”
NS’ Loeb often is asked why all of the Class I’s short-line interchanges aren’t included in the program. “Exception management” is built in so NS can determine where the program is working and where it’s not, he says.
Some short lines will be added and some subtracted from the 40 in the program to ensure optimal traffic-capture potential.
“This isn’t like peanut butter and spreading it all over. We want to see where the growth opportunities are and how volume breaks down,” says Loeb.
