CSX's Foote updates STB on railroad's restructuring plan

CSX has completed the first phase of its new operating plan, which has produced performance metrics that show a "remarkable rate of positive change," President and Chief Executive Officer James Foote said in a Jan. 3 letter to the Surface Transportation Board.

The letter was sent to the board in response to its Dec. 14 request for information on the Class I's progress in restructuring its operations by implementing the precision scheduled railroading (PSR) concept. The board asked for an update on the company's progress in five areas: car order fulfillment, local service performance, car trip plan performance, communication with customers and service in the Chicago area.

The STB's request came as part of the board's overall monitoring of the railroad's restructuring plan that began in March 2017, after E. Hunter Harrison — a longtime champion of the PSR model — took over as CSX president and CEO. The changes — which included cost-cutting and layoffs — prompted several CSX customers to complain to the board about a deterioration of the railroad's service levels.

Harrison died Dec. 16 of unexpectedly severe complications from a recent illness. His death came just two days after CSX's board announced Harrison would take a medical leave. Foote has since been named the Class I's top executive.

In his letter to the STB, Foote noted Harrison's death, adding that "his vision and legacy continue to flourish" at the company.

"As he's done elsewhere, Hunter has fundamentally transformed CSX," Foote wrote. "He achieved a tremendous amount of positive change at our company in a short time, and his presence will be dearly missed."

Foote said that CSX has entered the second of two phases of PSR implementation. The first phase involved "top-to-bottom changes" that included conversion of certain hump yards to flat switching and strategic adjustments to other facilities.

"It also led to replacing CSX's traditional methods with a new, balanced,  scheduled train plan comprised of significantly more mixed-freight trains," wrote Foote. "Most importantly, Hunter instilled a new railroad culture that has everyone focused on the five tenets of PSR: service, asset, utilization, controlling costs, safety and people."

The plan's second phase — which involves the daily execution of those five tenets — is "well underway," Foote added.

"In short, what you have is a better-run railroad," his letter stated. "We're seeing these benefits today and expect more to come as we move into 2018."