Network saw a significant positive inflection in performance. â« Velocity, train originations ... Right Car Right Train
STB UPDATE
DECEMBER 5, 2017
Network saw a significant positive inflection in performance Highlights ̶
Velocity reaches new high point of 17.7 mph, 19% improved from 2016 average velocity ̶
Dwell remains healthy at 10.6 hours, and is 5% improved from 2016 average dwell ̶
Train originations and arrivals better than 2016 average levels ̶
Right Car Right Train at best level seen in reporting period
2
Velocity, train originations and arrivals notably improved this week Right Car Right Train up with improved network speed and execution Crew and power resource levels remain well matched to demand Hump yard performance steady, dwell levels improved Western terminals performing well Car ordering and fulfillment process updated, car orders and fulfillment settled higher following holiday
Local pull and place performance returned to prior levels after holiday-related impacts
Customer problem logs remained at lower levels Interchange volumes current and gateways fluid
Velocity has fully recovered, now accelerating well above 2016 Velocity (mph) Improvement Degradation
2016
2017
20
Velocity
18
STB Listening Session
16
14
PSR Implementation
12
Height of Service Disruption
10 1
3
5
7
9
11
13
15
17
19
21
23
25
27
29
31
33
35
37
39
41
43
45
Week
2016 Full Year Average PSR Implementation Height of Service Disruption STB Listening Session Current Week 3
Velocity (mph) 14.9 13.8 13.0 15.4 17.7
Fav (Unfav) % Change vs. 2016 (7%) (13%) 3% 19%
Note: Dwell and velocity displayed according to CSX methodology; explanation of CSX methodology can be found in appendix. Week 37 & 38 velocity excludes specific trains held through Hurricane Irma.
47
Dwell at or below 2016 full year levels for 12th consecutive week Dwell Gross(hours) Dwell Degradation Improvement
16
2016
2017
Height of Service Disruption
Dwell
14
12
PSR Implementation
10
STB Listening Session
8 1
3
5
7
9
11
13
15
17
19
21
23
25
27
29
31
33
35
37
39
41
43
45
47
Week
2016 Full Year Average PSR Implementation Height of Service Disruption STB Listening Session Current Week 4
Dwell (hours) 11.2
Fav (Unfav) % Change vs. 2016
11.6 13.1 11.0 10.6
4% (17%) 2% 5%
Note: Dwell and velocity displayed according to CSX methodology; explanation of CSX methodology can be found in appendix. Week 37 & 38 dwell excludes terminals that held cars through Hurricane Irma-impacted period
Velocity, Originations and Arrivals notably improved this week
68%
60%
60%
40%
40%
20%
20%
70% 64%
60%
64% 63% 63% 67% 67% 65% 64%
76%
76%
78%
86%
78%
81%
80%
74%
77% 77% 74% 74% 74% 73% 74% 73% 71%
80%
100% 66%
84%
87%
84% 81%
82%
88%
84%
83%
Weekly Average 100%
88%
On Time Arrivals (%) 88%
On Time Originations (%)
On-Time +2 hrs On-Time
42
43
44
45
46
47
2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47
Nov. 25 – Dec. 1
Weeks
2017
2017
Weeks
Dwell (hours)
Velocity (mph)
16.0 9.7
10.0
16.2
9.8
10.6
15.7 15.4
14.9 14.2
16.0
16.4 16.3
17.4
12.0
18.0 11.2
10.7 11.0 10.5 10.4 10.5 10.6 10.6 10.7
10.8
10.2
11.2 11.6
12.1
10.5
14.0
16.1
20.0
16.0
12.0
Nov. 25 – Dec. 1
14.9 14.9 14.9
14.0
14.0 12.0
8.0
10.0
6.0 2016 Q1
Q2
2017
Q3
40
41
42
43
44
Weeks
45
46
47
Nov. 25 – Dec. 1
2016 Q1 Q2 Q3
2017
40
41
42
43
44
45
46
47
Nov. 25 – Dec. 1
Weeks
Network measures reaching new threshold of positive performance 5
Note: Dwell and velocity displayed according to CSX methodology; explanation of CSX methodology can be found in appendix. Q3 dwell and velocity exclude the Hurricane Irma-impacted period for terminals that held cars and specific trains held through storm, respectively.
17.9
41
18.1
40
18.2
Q3
18.5
Q2
18.0
2016 Q1
+2 hrs
Right Car Right Train up with improved network speed and execution Right Car Right Train is no longer a measure that CSX uses to manage its operation
Right Car Right Train1 Weekly Average 90%
75%
77% 74%
73%
73%
72%
74%
72%
75% 76% 76%
73%
70%
79%
80%
82%
79%
82%
82%
85%
80%
86% 86%
― In precision scheduled railroading (PSR), if a car can be advanced on another train to speed transit or ensure its on-time arrival, there is not one “right train”
Car priority is to move cars quickly, on next available train ― Asset utilization a key tenet of PSR
65%
Train priority is blocking integrity and departing all available, relevant cars from the yard
60% 55% 50% 2016 Q1 Q2 Q3 40
2017
1
6
41
42
43
44
Weeks
45
46
47
Nov. 25 – Dec. 1
― Blocking integrity certifies that a train is built correctly and shipments are headed to the correct location ― Managed through field supervision
‘Right Car Right Train’ is defined as the percentage of cars that departed from a yard in accordance with their car scheduling trip plan
Resourcing appropriately to meet business needs Train & Engine Headcount and Re-crew Rate1
Active Locomotives 4,000
10,000
12%
3,763 3,673
9,800
3,600 3,376
9,771
9,600 3,200 3,182 3,184 3,162 3,165 3,174 3,180 3,192 3,200 3,179
3,200
10%
9,690
9,400 9,223
9,200
2,800
8%
9,445 9,278 9,264 9,247 9,225 9,204 9,189
6% 9,081 9,049 9,028
9,000 2,400 2,000 2016 Q1
Q2 Q3 2017
40
41
42
43 44 Weeks
45
46
47
8,800
2%
8,600
0%
48
Locomotive level stable; engines to come down in concert with network velocity improvement
2016 Q1 Q2 Q3 2017
40
41
42
43 44 Weeks
45
7
46
47
48
Recent headcount reduction driven by train staffing efficiency and adjustments to extra boards
Power and crew availability steady in fourth quarter at approximately 99% and 95%, respectively 1
4%
Re-crew rate is re-crew people starts as a percent of total measured people starts, and represents incidences of replacing a crew on the same train ID (generally due to hours of service)
Hump yard performance steady, dwell levels improved CSX Hump Terminal Overview
Total hump yard volumes remain in a consistent band week-over-week, well below capacity of yards
Key hump productivity and efficiency measures performing well, four humps remaining
Transitioned to flat-switching operations Hump terminals
Selkirk, NY Toledo, OH Willard, OH Cumberland, MD Cincinnati, OH
19.8 17.2
17.7
18.8 18.7
21.5 20.6 20.8 20.1 20.1
14.0 10.0
Absolute number of humps not “good” or “bad”; goal is best mix of hump and flat yards for processing efficiency 1
8
6.0 2016 Q1 Q2 Q3 40
2017
41
42
43
44
45
46
47
Nov. 25 – Dec. 1
Weeks
Dwell displayed according to CSX methodology; explanation of CSX methodology can be found in appendix. Q3 dwell excludes the Hurricane Irma-impacted period for terminals that held cars through the storm.
16.9
18.0
19.9 20.6
15.3
Waycross, GA
22.0
16.1
Atlanta, GA
26.0
16.7
Birmingham, AL
Hamlet, NC
17.8
Nashville, TN
Weekly Average
30.0
19.3
Louisville, KY
Dwell at Hump Terminals1
18.0
Avon, IN
Western terminals performing well Western Corridor Key Terminals
Key terminal productivity and performance measures recovered in former “trouble” spots
Train plan changes at Evansville have resulted in very few cars processed, no longer a key terminal
Avon, IN
Evansville, IN
Dwell at Western Terminals1
Nashville, TN
Weekly Average
22.0
Birmingham, AL
11.4
12.3 12.5 12.4 11.9
10.0
6.0
Key Western terminals
2016 Q1 Q2 Q3 40
2017 1
9
41
42
43
44
45
46
47
Nov. 25 – Dec. 1
Weeks
Dwell displayed according to CSX methodology; explanation of CSX methodology can be found in appendix. Q3 dwell excludes the Hurricane Irma-impacted period for terminals that held cars through the storm.
9.6
12.1
12.2
12.6
Mobile, AL
10.6
14.4
11.0
13.6 13.4
12.8
14.0
13.0
12.3
15.6
Montgomery, AL
14.1
18.0
Car orders and fulfillment settled higher following holiday Weekly Car Orders, Customer Empty Idles, and Fill Rate1 Order Fill Rates
Cars Ordered/Idle 7,000
100%
6,000
90%
5,000
80%
4,000 70% 3,000 60%
2,000 1,000
50%
0
40% 2016 Q1
Q2 2017
40
41
42
43
44
45
46
47
48
Weeks
Weekly Orders
Customer Empty Idles (> 24 hours)
Order Fill %
Order Fill % ex. Customer Empty Idles
1
10
Q3
Car ordering and fulfillment process updated as of Week 45 ― Car orders now remain open for 2 weeks for fulfillment; order fill will settle over a 2-week period ― Accordingly, the current week fill rate will be adjusted in the following week for orders filled
Week 48 added nearly 240 orders filled to week 47, adjusted fill increased to 88% ― Week 48 will further improve into week 49
Empty car dwell remains elevated at customer locations, impacts order fill ― Empty idle cars at a given customer held >24 hours considered available to fill that customer’s orders
2017 fill rate has been normalized through Week 44 against historical/expected order levels (Q1 2017), as order levels disconnected with demand beginning in Q2 2017; 2016 orders and fulfillment and 2017 Week 45 and beyond do not warrant normalizing
Last mile performance measure recovered after holiday week Local Service Measurement (LSM) is no longer a metric that CSX uses to manage its operation
Local Service Measurement1 100%
94% 95%
90%
90% 81%
86%
84% 83% 85% 85% 85% 84% 85% 77%
80%
― In precision scheduled railroading (PSR), focus on endto-end transit and customer expectations
Accordingly, LSM as a reported metric was discontinued upon start of PSR implementation
70% 60%
― At request of STB, last mile tracking reinstated to monitor through implementation period
50% 40% 30%
Reliable pull and place expected as part of service to customers
20% 10% 0%
2016 Q1
1
11
Q2 Q3 2017
40
41
42
43
44 45 Weeks
46
47
48
‘Local Service Measurement’ is defined as the percentage of cars that were pulled or placed at a customer location based upon daily customer request, the local service plan and available inventory at the local serving yard
Customer problem logs remained at lower levels Customer logs largely back in normal range after network challenges as fluidity has returned
Customer Inquiries Daily Average Log Volume
570 Total Logs in Week 30 at height of service challenges
Lower level of logs, improved communication allowing faster, more comprehensive resolution
416 318 269
265
278
247
253
42
43
254
266
258 213
201
Q1
Q2
Q3
40
41
2017
45
46
Weeks
Delayed Cars
12
44
Bad Order
Switching Issues
47
48
― Accountability for resolution of customer issues resides with field responsibility ― Escalating and resolving critical issues with senior leadership
Interchanges current and performing to expectations From
East St. Louis 800
Daily Average Interchange Volume
Chicago
To
2,000
Daily Average Interchange Volume
1,600
600
1,200
400
800 200
400
0
0 2016 Q1
Q2
Q3
40
41
42
2017
43
44
45
46
47
48
2016 Q1
Q2
Q3
40
43
44
45
46
47
48
47
48
Weeks
Memphis
Daily Average Interchange Volume
300
400
200
200
100
0
Daily Average Interchange Volume
0 2016 Q1
Q2
2017
13
42
2017
Weeks
New Orleans 600
41
Q3
40
41
42
43
44
Weeks
45
46
47
48
2016 Q1
Q2
2017
Q3
40
41
42
43
44
Weeks
45
46
Precision scheduled railroading producing service improvement Service Improvements & Productivity Improvements
Operational Focus Balanced Train Plan
Improved Frequency
Better Reliability
Rolling Stock Utilization
People Efficiency
Terminal Fluidity
Faster Transit
Quicker Turnaround
Fuel Optimization
Train Density
Improve Service
14
Operate Safely
Control Costs
Drive Asset Utilization
Develop People
Realigned service frequency in second quarter Set the groundwork of a balanced train plan in early July Terminals’ improved efficiency and traffic flow adjustments have recovered service Improved execution on this foundation to drive long-term service and productivity improvements
APPENDIX
CSX has changed methodology on some metrics reported publicly Velocity
Dwell Former
Car time at terminal, excluding cars on the same train ID
Current
All car time with a terminal work event, including through cars on same train ID (e.g. crew change)
Change Reason
Includes full trip of a train and ability to diagnose overall speed profile (in support of improvement in asset cycle)
Effect on Metric
Reported velocity will be lower
Former
Line of road miles per hour
Current
Total miles traveled per hour, including intermediate dwell of the train
Cars Online Former
All cars on CSX, as determined by RailInc
Current
RailInc cars on CSX, excluding cars stored, under repair, sold, and private cars ex online inventory
Change Reason
Includes all dwell with ability to diagnose all events impacting car movement (in support of improvement in asset cycle)
Change Reason
More accurate measurement of active cars on line, i.e. cars for which CSX is focused on realtime, efficient movement
Effect on Metric
Reported dwell will be lower
Effect on Metric
Reported cars online will be lower
Restated historical data in new methodology available on csx.com/servicemetrics
16
