UP and NS officials say they are working to speed up their railroads

By Bill Stephens | March 14, 2018

NEW YORK CITY — Union Pacific and Norfolk Southern executives say they are working hard to speed up their railroads in light of stubborn operational issues that have slowed average train speeds and increased the amount of time cars spend in yards.

UP continues to struggle with sluggish train speeds and higher than normal terminal dwell times despite having enough locomotives, crews, and track capacity to handle current traffic volumes, Chief Financial Officer Rob Knight told an investor conference on Tuesday.

Part of the reduction in train speeds continues to be the rollout of positive train control, as crews need to be trained on the new technology and technical glitches arise from time to time.

But the terminal problems are the result of “execution issues,” Knight says.

The solution is Railroading 101 and getting back to the basics, Knight says.

“Every minute of every day we’re focused on it,” Knight says.

But he was unable to offer a timeline of when UP’s service metrics may return to more normal levels.

UP’s velocity fell 5 percent in the fourth quarter, declined 2 percent in January, and was down 4 percent in February. Terminal dwell, meanwhile, was up 12 percent in the fourth quarter, rose 7 percent in January, and increased 8 percent in February.

NS, meanwhile, expects its slower network to boost operating expenses by $50 million in the first quarter, Chief Marketing Officer Alan Shaw told an investor conference on Wednesday.

NS’s problems are centered on the Alabama and Georgia Divisions, where traffic growth and bad weather clogged Norris Yard in Birmingham, Ala. The congestion then radiated outward when NS was forced to hold Norris-bound trains on passing sidings.

In January, NS sent 55 crew members from around the system to Birmingham, Ala. To ease main line congestion on the East End District between Birmingham and Atlanta, NS returned through traffic to the Central of Georgia District. Through trains were shifted off the Birmingham-Columbus-Macon, Ga., routing in the middle of 2017.

“We are starting to see some operational improvement in the Birmingham yard and it’s a lot more fluid than it was a few weeks ago,” Shaw says.

Last week dwell at Norris Yard fell to 38.5 hours, down from 52.7 hours three weeks earlier. NS’s average train speed remains low, however. Last week it stood at 19.1 mph, down 16 percent from the average speed in the first quarter of 2017.

“We will get this fixed,” Shaw says, although he declined to provide a firm timeline other than say NS hopes to restore service levels as quickly as possible.

CSX Transportation drew shipper ire and regulatory scrutiny for its service problems last year amid the rapid rollout of Precision Scheduled Railroading under then-CEO E. Hunter Harrison.

But today CSX CEO Jim Foote said that his railroad is operating at all-time low terminal dwell and trains are running 14 percent faster than last year. While there’s still room for improvement, Foote says CSX is operating better than any railroad in North America.

Knight, Shaw, and Foote spoke this week at the J.P. Morgan Aviation, Transportation & Industrials Conference.

Reply Reply All Forward