Farmer at MARS winter meeting: Four key ways BNSF can effect positive change
1/21/2025
By Jeff Stagl, Managing Editor
This is clearly a time of uncertainty in the rail industry, but that isn’t something new. There have been many such periods in the industry over the past two centuries.
That’s how BNSF Railway Co. President and CEO Katie Farmer began her keynote address Jan. 15 at the Midwest Association of Rail Shippers winter meeting in Schaumburg, Illinois.
So, what is new? The speed of change is faster now, said Farmer in front of a record winter gathering crowd of 950 at MARS’ overall 264th meeting.
And what will change look like in 2025? For BNSF — and likely many other railroads — there are four areas of focus this year that will be deciding factors. They are safe operations; solid and consistent service; capacity investments; and “the ability to be relevant,” said Farmer, adding that the key to relevancy is ongoing innovation.
Safety, as always, is the most important focus area, she stressed.
“Everything we do begins and ends with safety,” said Farmer.
In 1980, the Burlington Northern Railroad and Santa Fe Railway — which later merged to form BNSF — registered 6,000 injuries. Last year, BNSF recorded 300 injuries.
The Class I’s injury frequency ratio in 2024 was 0.86. The ratio is determined by the number of Federal Railroad Administration-reportable injuries per 200,000 employee-hours worked annually. By comparison, the manufacturing industry’s collective injury frequency ratio last year was a much higher 2.8, said Farmer.
Customers expect BNSF to provide consistent and reliable service. “That’s why I call it table stakes,” said Farmer. Midwest Association of Rail ShippersBNSF also has led the rail industry the past nine years with the fewest derailments, she said. In 2024, the railroad had 30% fewer derailments than in 2023.
While safety is paramount to success, service performance is the ultimate “table stakes,” said Farmer. Customers demand that the railroad perform consistently and reliably.
To that end, BNSF reached record volume in October 2024 and handled it well with 7% faster system velocity, Farmer said. The Class I also handled 80 million packages during the fall peak, which turned out to be a record peak for the railroad with perfect performance for parcel customers, she said.
“We want to lean in to deliver like that all year long,” Farmer said.
In 2024, BNSF also registered its highest annual volume since 2016 and lowest average terminal dwell time in over a decade, including the lowest dwell time in a given day in the railroad’s history.
“Customers expect this from us. That’s why I call it table stakes,” said Farmer.
In terms of expanding capacity, a longtime effort to add track along the Southern Transcon route between Los Angeles and Chicago reached a pinnacle last year. After completing 51 miles of double track in Kansas last year, the entire 2,200-mile route now features multi-track — either double, triple or quadruple track — except for two bridges. And the railroad is taking action to address those bridges, said Farmer.
BNSF also continues to develop logistics parks for intermodal business and logistics centers for carload business. Logistics parks feature an intermodal hub as the centerpiece with distribution centers nearby, while logistics centers predominantly are facilities that handle bulk agricultural and industrial products.
“I would argue that innovation is a way to remain relevant as a part of the supply chain,” said Farmer. Jeff StaglBNSF currently is developing Logistics Park Phoenix and is advancing a long-range plan to develop a logistics park in Lochbuie, Colorado, near Denver.
On a much larger scale, the Class I also is developing the Barstow International Gateway (BIG), a $1.5 billion, 4,500-acre integrated rail facility that will feature a rail yard, intermodal facility and warehouses when it opens in two to three years.
“We are excited about the conversations we are having with customers [about the BIG]. There are some household names that we are talking to,” said Farmer.
The railroad currently operates logistics centers in Fontana, California (near L.A.), Sweetwater, Texas, and Oklahoma City, Oklahoma, and expects to open one this year in Cleveland, Texas. Four more logistics centers are in the process of development, said Farmer.
“They are in under-served locations and handle multiple commodities,” she said.
As BNSF continues to lean into capacity, it also keeps leaning toward adopting more innovation, Farmer said.
“I would argue that innovation is a way to remain relevant as a part of the supply chain,” she said.
The railroad has been busy in that regard. BNSF holds four times as many patents as others in the rail industry, said Farmer.
For example, the railroad continues to refine and enhance its automated track inspection system. The number of miles that can be inspected each year already have climbed from 70,000 to 500,000 because of the system, which increases inspection frequency and speed.
BNSF also is developing a locomotive-based track geometry system called Onboard Defect Identification & Notification, or ODIN. Housed in an aluminum enclosure mounted underneath a locomotive, the system collects and analyzes track measurement data while the locomotive operates in freight service. ODIN uses artificial intelligence and machine learning to analyze a piece of track for any defects, said Farmer.
“It can remediate a track issue without affecting service,” she said.
Moreover, BNSF is working on providing customers more accurate estimated times of arrival (ETAs). Similar to a refined ETA a parcel customer continually receives from UPS or FedEx, the railroad aims to give customers a predictive ETA that would change as a shipment weaves its way from origin to destination, said Farmer.
“We are going through all the historical data we have and what’s missing is predicting work,” she said.
As an example, she described how she recently purchased items online, then quickly obtained a UPS tracking number and delivery date. Over the following week, the ETA kept getting refined until she received a message about when her package would arrive.
That’s the concept BNSF is seeking rather than the static ETA railroads traditionally provide, said Farmer.
“What we’re saying is, take all the historical information, use the predictive tools that we have ... and continue to give a predictive ETA,” she said. “We believe it’s not so much where your shipment is, but the confidence level you have of when your shipment is going to get to you. Because then you can plan your crews to unload, and you can plan your inventory better.”
