CSX and Hunter Harrison

dak94dav Feb 16, 2017

  1. Point353

    Point353 TrainBoard Member

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    It may also be driven by a combination of railroad legal departments, insurance companies and OSHA.
    You can try to regulate a workplace in order to make it safe for a rational sentient being or you can try to make it absolutely idiot-proof.
    A rational sentient being is relatively unlikely to take an action which may cause injury while an idiot might not hesitate to do so.
    If the idiot gets hurt and then sues the employer, the outcome might be a large payout and a penalty from OSHA.
    Therefore, the tendency is to over-regulate the workplace in the name of safety even at the expense of reduced efficiency.
    Although there may not appear to be an appreciable gain in workplace safety, the objective is to help ensure that if some idiot does get injured on the job it is because a rule was violated and, thus, the employer is not liable.
     
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  2. Hardcoaler

    Hardcoaler TrainBoard Member

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    That sums it up Point353. It's an eternal quest for work procedures based on airtight legal protection, joined with continued expectations of high productivity and employee engagement. The combination is maddening. I am SO glad to be retired. :)
     
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  3. acptulsa

    acptulsa TrainBoard Member

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    Lawyers rule the world. Been in a hospital lately? They wake you up every two hours to take your blood, so they can test for a 'silent heart attack'.

    Who can heal without sleeping?

    The 'new normal' is insanity. We're about five and a half feet away from becoming Soviet Russia. Just because that worked out so well...

    And it did, too--for Stalin and his buddies. For everyone else? Not so much.
     
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  4. jpwisc

    jpwisc TrainBoard Member

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    Many people blame OSHA or other government agencies. They have been stripped of any real power. Fines are so minimal they have no impact on the industry. One recent example where a company owner removed some safety equipment resulting in the fatality of one of his employees yielded a $7,000 fine.

    There are two major factors that do impact internal regulations, the first is insurance. For every legitimate employee a company has, the company carries insurance. Pricing is similar to when you buy car insurance. You can adjust the deductible and other factors to get different pricing. I sat down with a safety director last week to discuss just this. The company I met with has 500 employees, they have a $150,000 deductible per employee (just like you have on your car insurance). The cost of the policy to the company is over $2 million a year. If you have accidents, cost goes up. Companies implement safety policies to reduce accidents that have both short term and long term cost implications.

    In the industry I work in the other factor is customers. Contractors can refuse to allow a contractor to bid if their safety record (Mod Rating) isn't up to par. This can literally kill a company overnight. You see this in railroading as well. BNSF just terminated a contract with a shortline in New Mexico because they had a substandard safety record.

    While we all want to see everyone go home safe at night and work till the day they can retire, safety is a dollar driven business.
     
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  5. Hytec

    Hytec TrainBoard Supporter

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    Thank you for explaining a situation that I, for one, did not know existed.
     
  6. BoxcabE50

    BoxcabE50 Staff Member TrainBoard Supporter

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    At least in theory they are not..... :(
     
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  7. mmi16

    mmi16 TrainBoard Member

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    For several decades Operating and Safety rule have been written by the Law Department - not the Operating Dept.
     
  8. Hardcoaler

    Hardcoaler TrainBoard Member

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    OMAHA, Neb. (AP) — 07/18/2017 - CSX Corp. delivered a 15 percent improvement in second-quarter profit as the railroad continues to restructure under its new CEO. <snip> Its shares have increased 52 percent since the beginning of the year, while the Standard & Poor's 500 index has increased roughly 10 percent. <snip> [End]

    An impressive result, at least in the short term. Behind the curtain, I've read that CSX is in operational calamity. Many senior managers have quit or been fired and that remaining supervisory personnel are often young and inexperienced. Several yards are severely clogged and system transit times are rising. Time will tell how long shipper patience will l last and if higher earnings are permanent.

    In other news, NS is eliminating its Central Region headquartered in Knoxville and dispersing its lines and dispatching amongst other Divisions. This follows elimination of the Virginia Division some time ago.
     
  9. GP30

    GP30 TrainBoard Member

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    I can only speak from activity in my area. In May, Q316 & Q317 on the Mountain sub was rerouted up Fairmont Line over the NS to Connellsville, PA and terminated there. Unconfirmed reports say NS wouldn't allow hazardous material to be transported on their non-PTC route and the operation required running around the train twice. As of around the 1st July, Q316 & 317 are running over the Mountain Sub again to Cumberland, then back-tracking to Connellsville.

    I, too have heard about Indianapolis getting clogged up, in order to relieve the traffic, they rerouted some traffic through Willard and that is clogged up now, too. I don't see how the "Precision railroading" system would help matters. "Precision" can't replace rerouted traffic and eliminated hump yards.
     
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  10. BoxcabE50

    BoxcabE50 Staff Member TrainBoard Supporter

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    Normal, for the type of slash and burn ongoing. These activities, on average, produce a spike lasting one and one half years, to about three years. Thereafter, the falloff is rarely other than dramatic. This makes the party leading the charge look good, sets up a nice line in their resume' and a great golden parachute. Then the next poor victim(s) following must try piecing the wreckage back together- requiring large capital investment and years of hardship for all.
     
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  11. Point353

    Point353 TrainBoard Member

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    Next step is CSX+UP or CSX+BNSF.
     
  12. BoxcabE50

    BoxcabE50 Staff Member TrainBoard Supporter

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    And thereafter such a monopoly will be followed by a monumental boom in the trucking industry...... Perhaps now is the time to be investing in truck and trailer manufacturers? Trucking companies? Hiking and biking trail constructors?
     
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  13. Hardcoaler

    Hardcoaler TrainBoard Member

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    It's tough to say. Final transcontinental pairings would be met with terrific resistance from shippers, the STB, Congress and even CN, CP and regionals if they felt shut out. Conrail's sale was an expensive and complex affair, and I can't begin to imagine the line sales, trackage rights, open access demands, shared territories, lobbying, environmental studies and widespread municipal extortion that would be in play with transcon mergers. The cost of putting it all together would far outweigh any claim of reduced operating costs.

    < as I type, Hunter Harrison is on the phone with Warren Buffett ...... :eek: :sneaky: >
     
    Last edited: Jul 19, 2017 at 9:25 PM
  14. Hardcoaler

    Hardcoaler TrainBoard Member

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    Interestingly, CSX shares fell 5% today despite the good news from Jacksonville. CSX guided Wall Street a bit lower on earnings estimates for 2H 2017 and the euphoria burned off a bit. NS fell 2% in concert.
     
  15. BoxcabE50

    BoxcabE50 Staff Member TrainBoard Supporter

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    I always wonder just how close to reflecting reality this form of legalized gambling might be...?
     
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  16. Hardcoaler

    Hardcoaler TrainBoard Member

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    UP's CEO was on CNBC this morning and he too guided the Street to expect limited numbers in the second half. I couldn't help but grimace when a CNBC panelist asked the UP CEO if his railroad has been able to pick up any new business as a result of CSX's service troubles. Rather than snidely point out that the two roads don't compete in the same region, he kindly said that the UP doesn't comment on other railroads.
     

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