RailTrends 2024: Tony Hatch's top 10 reflections and impressions (and more)

“We are stardust, we are golden 
We are billion-year-old carbon 
And we've got to get ourselves 
Back to the garden” / Woodstock by Joni Mitchell via CSNY 

I am still recovering from the sensory overload that was the 20th (!) and 2025 version of RailTrends, the “Woodstock of railroads” (thanks to CN's Tracy Robinson for reporting that from an earlier Canadian conference, and thus for making my day). It was, indeed, if you count preliminary events, three days of fun and learning, and so much more than that. 

So, below, are my top 10 reflections and impressions from RailTrends 2024. And we hope to get you back to the garden in 2025!   

1. It was a sold-out event of some 350 attendees and once again the power of the audience — just as a sample, it included one Class I CEO, two Class I heads of strategy, investors of all types (PE, infra, long-only, hedge fund, even activists), suppliers, consultants, shippers, lessors, OEMs, etc., etc., etc. Maybe it was more the “Star Wars” bar of railroading? If you laid off the brown acid, you could learn a lot, but because of the intended diversity of position and opinion, everyone’s takeaways will be different. 

2. I feel obligated to say that my role is the so-called “front of the house” — I help set the agenda, organize speakers, speak, MC and lead Q&A. I am not responsible for the “back of the house” — my partners Trade Press Media Group/Progressive Railroading are responsible for the P&L, pricing, siting, sponsorships, etc. I am the “talent” (ha), they are the business folks. 

3. Of course, the government's role and the changing administration was a thread throughout just about every presentation and coffee-break discussion. And of course, as everyone noted, we’re all working off campaign promises and no policies are set, but: 

• In my own listing of benefits from the new admin versus the trade effects, I left off the energy/environmental stance, generally regarded as business-positive (draw your own conclusions as to whether it’s earth-positive). But, a few quick counter thoughts: Can U.S. drilling actually increase much? Will this usher in more pipelines? Remember, rails have been selling “green” with mixed success for some time, with the expectation that it would grow in importance with shippers. And: Bloomberg has reported that the incoming administration wants to ease rules on AV cars — and trucks — so there’s that. 

• During our annual fireside chat, AAR President and CEO Ian Jefferies, ASLRRA President Chuck Baker and RAC President & CEO Marc Brazeau also noted that the changing U.S. administration would mean new leadership in the FRA (“Where innovation goes to die” — source protected) and very likely in the CARB rules on locomotive emissions in Cali, etc. So, FRA waivers on ATI (automatic track inspection), rail-car inspection portals (like Duos’ RIP) and other innovations like Parallel Systems’ AV eclectic short-haul intermodal units will soon no longer be stone-walled. The AAR sees great opportunities to work with a reconstituted STB on pre-emptive rights, etc. — in other words, playing offense, not just defense. AAR’s Jefferies is also excited to work with the new Senate Majority leader John Thune, a man with a wealth of rail knowledge. ASLRRA’s Baker talked about the 45G tax credit (I cut and pasted from RT2012 or RT18 or etc.). Kidding aside, the update is a very big deal, perhaps even more important with grant monies being perhaps de-emphasized. 

• The STB: Three members spoke eloquently (and asked good questions!) while the chairman, who never replied to his invitation to speak, issued a press release nailing Union Pacific, the perennial target/antagonist, for “another example of UP’s inability to adhere to the Board’s guidelines and instructions,” noting in a rather too personal UP CEO Jim Vena’s “obtuse and misguided” reply — all this to an issue over a connection to a steel plant in Arizona and Native American rights. The issue may be real, or not, but the timing is beyond curious coming the night before Vena was to close RT24. I somehow think the other the board members were as surprised as I was. 

Meanwhile, the board panel was superb, a first for us, and I sense a good outcome might be a continuing convivial approach — one that’s more collaborative (see below): Commissioner Patrick Fuchs (soon to be elevated?) used the word “facilitative.” It’s clear that though partisan issues may exist (or any R or D issues around, say, a dispute such as CSX vs. Dow), these three commissioners want to “help ensure the long term sustainable health of the railway industry,” even if some of the ways and means may differ. They also seem to want to be better about deadlines (with the CN/Iowa Northern case still out there) and also mentioned pre-emption ... hmmmmm. 

4. It’s always Canada Day in railroading! The “CN Diaspora” was in full view — four of the six Class I presenters either run CN or can trace their roots directly there. So, there were lots of hockey references, eh? There’s also an election coming up North, too — meaning in a year or less, all three USMCA governments could/will be changed, ahead of the treaty’s 2026 deadline. 

5. The major theme was, of course, growth. I know I can actually hear the groans out there, but all of the presentations stressed this. The talk is being talked, and service reliability, technology and capital are being provided to ease the walk: 

• Adriene Bailey’s annual Oliver Wyman Lecture followed up on a year of OW papers on growth — short lines, business development, intermodal (see news on my summer project, below). The keys are transit reliability and improved ease of doing business (as I was taught lo, those many years ago). If the rails fail to do this, OW sees two pretty dramatic alternatives: M&A (to which I say, “No Way Jose” but), and shrinking and sharing infrastructure, which I might extrapolate as the “Dividend Model.” 

• On rail (transcon) M&A: Although the STB panel noted “no complaints” on the CPKC merger so far, I continue to believe that the “new rules” on enhanced (not “maintained”) competition will prevent any such mergers. Not everyone agrees, it seems — Adriene’s speech stirred up a hornet’s nest. 

• Other growth examples will be in the brief company notes, the short line examples and the Analyst Panel debate, below. 

6. The sub-themes included culture, as in culture change. After all, an eastern rail leader stated that “Nothing happens without an energized and motivated workforce. Nothing.”  No, it wasn’t CSX’s Joe Hinrichs (although he said much the same thing, in effect) — it was Norfolk Southern COO John Orr. This was really the underlying story for all railroads this year, and we hope and expect it to have staying power. 

7. Labor (as in union labor) was also a related and recurring theme, both in a positive way (CSX, NS and BNSF signing up large swaths of union employees before the national negotiations get underway) and as a risk (the Canadian carriers, the Canadian ports, the ILA, the BLET, crew availability in general). The rail company approaches range from positive negotiation to confrontation. The RAC — and Keith Creel in his recent Globe & Mail opinion piece — made the case for rails to be included as an “essential” industry, allowing the PM to have powers similar to POTUS to prevent work stoppages (Keith said there were 62 transport-related stoppages in 2023-24TD!). More below. 

8. Another underlying, consistent theme was collaboration, or viewing the industry as an ecosystem. This was mentioned a lot, perhaps most forcefully by Genesee & Wyoming CEO Mike Miller, who took the industry to task (“What got us here won’t get us there”) for showing exciting developments that are 5+ years away. Not even RailPulse (below), for which GWR was a founding partner, was spared; as big an achievement as it is, it has “tagged” just 1% of the rail fleet. His words hit home for a lot of listeners. By the way, it was also a celebration of GWR’s 125th year, growing from one railroad to 110. Just about every panel or presentation highlighted or called for greater industry collaboration, from the obvious (the short lines) to the newer products (MMX, Falcon, etc.) 

9. As always, we discussed technology and rail, opportunities and risks of falling further behind. I’ll cover the excellent technology panels later. We heard from Gina Trombley, CMO of mighty Wabtec, who I had last seen in Berlin at InnoTrans (a special note that WAB brought many folks to RT24, as they have in the past, so that added to the Power of the Audience).We heard from Nexxiot’s Kenneth Manka and partner RailPulse, live since September (we have supported the diplomatic achievement that is RailPulse since its inception). We had a great tech-entrepreneurs panel, showing that despite the long history of the industry and its reputation as hidebound, there are smart start-ups that are going to have big impacts on the rails, including Commtrex (Martin Lew), Parallel Systems (Mary John) and Duos Jeff Necciai). The former is looking to tech-inject carload growth; the latter two should be big winners in a differently led FRA. And we heard from three major consulting firms, aside from OW, of course. We noted PWC (Rajeet Mohan) and their Ecosystem report last week; joining them in an interesting discussion were BCG (David Schaar), returning, and McKinsey (Dilip Bhattacharjee). They noted a changing bias towards “build” over “buy” (hurray!), and that there were positive signs emerging, noting that the major rails were putting their CIOs front and center in discussion with investors (as noted in both CSX and UP’s Investor Days). 

10. To quote another song, “We have a long way to go and a short time to get there,” and even though it’s a trucker song, we will take the advice and note that in the interests of time, we have shortened the tech panel discussion, above, and will give too short a shrift to the trade Association (RSI, REMSA, IANA, NRC) panel, best ever, except to note that the NRC Conference in January and the RSI/REMSA (and RSSI) “Railway Interchange,” this year in May, are must-go events on my calendar. You know that Intermodal Expo is, of course, and IANA is seeking to proactively help sell the IM value proposition and will release my Intermodal White Paper soon. 

Other impressions from company presentations and panels: 

• If Canadian National didn’t have bad luck, they’d have no luck at all! This is the third song reference in this recap, if you’re counting, and the second time I have paraphrased Albert King and “Born Under a Bad Sign” to describe the CN. Last time it was weather and blockades and auto strikes. This time, it’s been weather and strikes or lockouts (their own, ports on both coasts), and the reputational and share shock that followed, not to mention unplanned work on their share asset area in BC by their partner/competitor. Through it all, CN and CEO Tracy Robinson have managed and persevered, and she brought a smile to me not only by the “Woodstock” reference but in saying she would be back to recount CN’s resiliency and growth for “years and years.” 

• BNSF has been the growth leader since BN joined with SF, and thanks to the latter, it has been intermodal that has led the way. New(ish) CMO Tom “G” Williams, one of the dozen or so Indiana University grads at RT24 (and given their football (!) record, they’re only too happy to tell you), noted that BNSF had managed the strong west coast IM growth all year while still providing good service. October, in fact, was their all-time IM month, and Quantum, their premier J.B. Hunt product, remains at a 95% on-time rate. Tom’s replacement as head of BNSF Intermodal, Jon Gabriel, was also in attendance. But it’s not all intermodal. Aas an example of collaboration etc., Tom revealed that BNSF’s Short Line Select program is adding three new members and won’t stop there. 

• Keith Creel of the CPKC is the first two-time winner of the Railroad Innovator Award, and deservedly so. I don’t see any “Sports Illustrated curse” happening in 2024-25. In his award acceptance speech, KC of the CPKC noted that his “pro-growth” merger is all about innovation and collaboration, from his Americold partnership business to the redesigned closed-loop auto supply chains to the connections with now both eastern carriers at Meridian, MS. 

Clearly innovative is CPKC’s leadership in hydrogen powered locomotives; we saw one from their partner in the product, CSX, on their I-day. On Nov. 20, CPKC announced two hydrogen fueling stations are being built in Alberta. 

Separately, we had a brief moment to honor the lives and careers of two other Railroad Innovator Award winners: the KCS’ Pat Ottensmeyer and the CSX’s (and CN’s, of course) Jim Foote. At our event, Keith announced that the much-anticipated Laredo bridge linking the United States and Mexico, the second span opening by year-end, will be named the “Patrick Ottensmeyer International Bridge.” Given Pat’s role not just at the KCS but in bettering U.S.-Mexican relations, it is a very fitting tribute — and makes us miss him even more given the challenges forthcoming to that relationship. 

• Union Pacific CEO Jim Vena is always compelling and even challenging as a speaker (I reference here our ongoing public discussion of the very real, shareholder-not-management driven “Cult of the OR”). At RT24, he said that UP was showing signs of breaking the old debilitating pattern of increased volumes = decreased service. As Rick Paterson allowed in the Analysts Panel (below), “Buffer is working,” And yes, Jim is an operator, in the old Hunter-school way, but I was heartened to hear him reiterate that  “You (UP, railroads) can’t win if you don’t grow, and you can’t win by price and efficiency alone.” And for this he gets more grief from the STB?? 

• A quick aside: the most humorous note of the festival came from the last two performers, er, artists, err RAILROAD LEADERS. Both CPKC and UP discussed their steam restoration projects and how good they were in running around the system for employee morale, community relations, etc. Keith said that in Mexico, tens of thousands came to see their #2816 Empress, a beauty. But Jimmy V called that “Mickey Mouse” (really!), and said his “Big Boy” (a truly impressive sight indeed) was bigger and better. Freud would’ve had a field day!   

• CSX’s Joe Hinrichs knows how to speechify, especially on culture change and labor, and he did. It was interesting to note that their success at, in effect, “pre-signing” 11/13 unions was led by a mutual desire not to repeat the contentious negotiations of 2022, which came immediately before Joe’s on-boarding. The BLET might not be as constructive. ... It appears that Joe is a regular on “Mad Money.” Who knows, TV appearances seem to lead to big things these days, though CEO Joe and team are doing great things at home in Jacksonville. 

• John Orr had been at the Norfolk Southern for just 238 storm-filled days when he presented, but given the success of his PSR 2.0 playbook and energized team, sunnier and more stable days are ahead. The key is an overall plan, flexible enough to handle fluctuations in demand, or outside events, but organized enough to have all players in sync. The recent NS success, which Rick P called “remarkable,” is a testimony to the fact that it’s working, as had their resiliency shown (as at CSX) in facing the double-barreled hurricane impact of the fall, of the Baltimore bridge collapse in the spring. 

And, speaking of stability: VA Day! The war is over! In the middle of RT24, NS and Ancora announced a cessation of hostilities and a “constructive engagement” to add a new (14th) independent member to the BoD. Ancora sees a “new NS,” correctly, and praised new CEO Mark George (who attended RT24!) and also the man they often unfortunately and incorrectly disparaged, John Orr himself. ... Speaking (again) of RT24 attendees and of BoDs, Sameh Fahmy was there (as was CPKC Board Member and former AAR CEO Ed Hamberger) to add gravitas. 

• The Analyst Panel allowed me a few minutes of blather. I will have more time at meetings such as the NUTC Sandhouse Gang Annual Christmas Luncheon in Chicago on December 16 and at MARS in the same region a month later. What was interesting, as always were the comments from my colleagues. 

For example, Rick Paterson of Loop Capital discussed the rail residency performance as mentioned above — though from Down Under, he remains a Missourian on rails maintaining improving service in a volume recovery and came to a slightly different conclusion that the western rails on their performance in the face of the international IM surge. He sees a decent “bend not break” story, but bending, nonetheless. 

Intermodal guru Larry Gross also praised rail IM service, but noted a few areas of concern that need to be better understood: Cross-border Mexican volumes are down almost 8% YTD (??); the recovery in domestic intermodal containers is occurring but slower than expected; and in research with Noel Perry, he’s concluded that the “freight recession” is a myth. (When asked if a “curveball” was a myth, Sandy Koufax — do NOT ask “Who’s that?” — is alleged to have said, “Go stand behind that tree and let me make you all black and blue with my myth.”)  Larry did remind us all of one potent fact: Despite the volume growth this year (which indeed presents comparison issues for what he sees as a slower international IM year in ’25), IM has consistently trailed growth in truck, GDP and even imported TEUs. Stay tuned for my report/response! 

IANA’s October numbers, meanwhile, were encouraging (recall BNSF’s all-time highs): October was up 8.9%, actually better than YTD at +8.8% — comprising international up 12.7%, and domestic up 5.4% (COFC up 5.8%, still less than we might have expected, and TOFC down only 0.7%). 

• Let's end on some universally positive news courtesy of our annual the short line panel, which this year was run by NS’ (first ever) VP of First Mile Final (aka “Last”) Mile, Stefan Loeb. We had some newcomers on the panel, so I will start with those two: 

Al Sauer of Regional Rail gave an example of being accommodating — one Florida building products shipper had trouble finding a location, so Regional moved out of their own location and gave it to the shipper in return for carload growth. One key across the panel was being ready to move on site selection and planning at a moment’s notice. 

Bob Babcock of Livonia, Avon & Lakeville (Bob’s another Hoosier) noted improving Class I-short line relations after a roller coaster ride over the years (“This time does feel different”), and saw the need to teach potential customers how to use rail — “a mindset shift” after so much reduction in face-to-face meetings (something all decried, and an the opposite of short line thinking). 

Real estate availability and site selection/business development was a constant theme, and Dean Piacente of OmniTRAX (a RE-driven company) described how some of their best sales comes from customers on site helping convince others to come on board — notably, Home Depot. 

Ryan Ratledge of the Pinsley Railroad (ex-GAR) noted that his company’s short line operating success and behavior was a selling point to other short lines — Pinsley just closed on the “Hondo,” its seventh. He also described a creative move with the CN on one of its founding lines, Grenada (Mississippi) reducing empty miles. 

And: R. J. Corman’s Justin Broyles described a terrific story about a new aluminum plant in Kentucky bringing 6,500 loads over two RJC short lines with CSX (a short line skeptic at times) in the middle. RJC built a distribution center and two transloads for this move, highlighting an across the panel theme of “high touch” railroading involving skill sets above and beyond that of running trains.