Sep 13, 2017 - aid car fulfillment, transit and overall service experience ... (weeks 29-31); original terminals now hea
STB UPDATE
SEPTEMBER 13, 2017
Post-Labor Day Highlights Terminal fluidity largely restored with yards well-equipped to execute the plan Dwell and >48 hour dwelling cars now below late Q2 levels Velocity continues acceleration with reduction of train delays while en route Customer issue logs returning to expected levels as a result of network improvement The combination of lower dwell, increased speed and reduced train delay will continue to aid car fulfillment, transit and overall service experience
CSX preparing for sound execution into a period of heavier volume Hurricane Irma not expected to interfere with broad recovery momentum; however, will have localized effect on week 37 metrics (to be identified)
2
Sound progression in network performance through holiday week
Dwell improved last six weeks; velocity climbed last three weeks, significantly so last week Right Car Right Train in a stable range Crew and power resource levels remain well matched to demand Hump yards performing reliably as hump volume stays at elevated levels Western terminals recovered, secondary congestion substantially recovered Empty car fulfillment remained higher last week Local pull and place performance stable Customer problem logs down three weeks in a row and approaching normal levels Interchange volumes and performance steady CSX experienced congestion challenges at Western corridor terminals from mid-late July (weeks 29-31); original terminals now healthy and network recovery progressing
3
Dwell improved each of the last six weeks; strong velocity performance
55%57%55%
51%50%
72%
72%
62%
58%59%
61%
66%
57%
70%
52%
76%
75%76%
48%
65% 63%
73%
72% 72% 70%
72%
77% 74%
69%
82%
75%
Weekly Average 86% 87% 85%
74%
On Time Arrivals (%) 82%
On Time Originations (%)
On-Time +2 hrs On-Time +2 hrs
25 26 27 28 29 30 31 32 33 34 35
Sep. 2 – Sep. 8
Weeks
Weeks
25 26 27 28 29 30 31 32 33 34 35 Weeks
Sep. 2 – Sep. 8
13.6 13.5 13.3 13.0 13.2 13.1 13.3
25 26 27 28 29 30 31 32 33 34 35
Sep. 2 – Sep. 8
Weeks
Two disruptive derailments occurred in weeks 31 and 32, detrimentally impacting network performance 4
Note: Dwell and velocity displayed according to CSX methodology; explanation of CSX methodology can be found in appendix.
15.8
14.8
15.3
14.5
15.0 15.0
14.1
14.1
15.6 15.5
10.0
11.3
12.5
12.2
11.8 11.5
11.9
12.8 13.2 13.1 12.8 12.5
Velocity (mph) 11.0
11.8
11.9 12.3 11.9
10.4
Dwell (hours)
Sep. 2 – Sep. 8
14.0
25 26 27 28 29 30 31 32 33 34 35
Right Car Right Train holding relatively stable; less relevant in PSR Right Car Right Train is no longer a measure that CSX uses to manage its operation
72%
73%73%
70%
69%
72%71%
70%
73%
68%
73%73%
73%
75%
71%
75%
77%
Weekly Average
75%
Right Car Right Train1
― 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
Train priority is blocking integrity and departing all available, relevant cars from the yard 25 26 27 28 29 30 31 32 33 34 35 Weeks
1
5
Sep. 2 – Sep. 8
― 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
9,900
3,763
10% 9%
3,600
9,700
8% 7%
3,198
3,200
9,500
6% 9,338
2,800
9,300
9,223
5% 4% 3%
2,400
9,100
2% 1%
2,000
8,900 Weeks
Q3 locomotive level stable; recently added engines in response to incremental coal demand
0% Weeks
T&E trend tracking normal seasonality; re-crew rates remain at historic lows and stable
Power and crew availability steady in third quarter at approximately 99% and 95%, respectively 1
6
Re-crew rate is re-crew people starts as a percent of total measured people starts, and it represents incidences of replacing a crew on the same train ID (generally due to hours of service)
Hump yard performance steady CSX Hump Terminal Overview
Transitioned to flat-switching operations
Key hump productivity and efficiency measures performing well ― Cars per man hour at hump yards accelerating through the quarter, indicating yard productivity with higher volume at remaining humps
Hump terminals
― Dwell up slightly, though expected to return to lower levels (posthurricane impact)
Selkirk, NY Toledo, OH Willard, OH Cumberland, MD Cincinnati, OH
Absolute number of humps not “good” or “bad”; goal is best mix of hump and flat yards for processing efficiency 1
7
19.5 19.0 20.0
25
20.3 19.3 19.0 19.9 19.0 18.0 18.8
26 27 28 29 30 31 32 Weeks
Dwell displayed according to CSX methodology; explanation of CSX methodology can be found in appendix
33 34
21.4
35
Sep. 2 – Sep. 8
19.3
Waycross, GA
21.6
Atlanta, GA
20.0
Birmingham, AL
Hamlet, NC
23.8
Weekly Average Nashville, TN
20.8
Louisville, KY
23.3
Dwell at Hump Terminals1 24.5
Avon, IN
Western performance improved; plan changes alleviating congestion Western Corridor Key Terminals
Key terminal productivity and performance measures recovered in former “trouble” spots ― Dwell recovered and performing well ― Greater yard productivity evident in cars per man-hour processed
Train plan addressed secondary concerns ― Leveraged Avon as near-term offset of increased volume flow through Russell, Columbus and Louisville ― Dwell at these three locations down an additional 12% weekover-week, and 33% over three-week time period
Avon, IN
Evansville, IN
Dwell at Western Terminals1 Weekly Average
22.1 19.9
Mobile, AL
Western terminals
25
26
27
28
29
30
31
Weeks 1
8
Dwell displayed according to CSX methodology; explanation of CSX methodology can be found in appendix
32
33
34
35
Sep. 2 – Sep. 8
11.4
14.0 13.7 14.8
10.9
16.0
13.0
16.9 16.8 17.3
13.6
16.0
11.1
Montgomery, AL
19.5
12.1
Birmingham, AL
11.3
Nashville, TN
Car order fill slowly climbing; car flows to be interrupted by hurricane Orders remain detached from demand
Weekly Car Orders and Normalized Fill Rate Normalized Fill Rate
Cars Ordered
90%
7,000
85% 80%
6,000
5,000
Empty car dwell increasing at customer locations; down on CSX
70%
― Climb of empty customer dwell indicates improved car supply and availability; prevention of shutdown situations
60% 55% 50%
3,000
― Merchandise carload expectations down slightly in comparable timeframe
75%
65% 4,000
― Car orders up ~40% in Q3 vs. Q1 2017
― Reduction of empty railroad dwell indicates improving network flow of empty cars
45% 40%
2,000 25
26
27
28
29
30
31
32
33
34
35
36
Weeks
Weekly Orders
1
9
Normalized Order Fill %
Q1 Avg. Weekly Car Orders
Normalized fill rate is a proxy of demand fulfillment against historical/expected order levels, as current order levels have disconnected with demand
Normalized fill rate1 ranging 70-85% ― Process evaluation underway to realign order level with demand and improve fulfillment accountability
Last mile performance stable and returned to levels at end of Q2 Local Service Measurement (LSM) is no longer a metric that CSX uses to manage its operation
Local Service Measurement1
95%
90%
85% 83% 82% 84% 83% 80% 81% 81% 80% 79% 78% 82%
― In precision scheduled railroading (PSR), focus on end-to-end transit and customer expectations ― Last mile performance must be in combination with, not independent of, overall performance
Accordingly, LSM as a reported metric was discontinued upon start of PSR implementation ― At request of STB, last mile tracking reinstated to monitor through implementation period ― Data reflects passive information flow, lacking prior focus on field reporting to ensure LSM capture Q1 Q2 25 AVG AVG
26
27
28
29
30
Weeks
32
33
34
35
36
Reliable pull and place expected as part of service to customers
‘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 1
10
31
Customer problem logs down more than 50% over last three weeks Delayed cars remain most frequent concern
Customer Inquiries Daily Average Log Volume
570 563
537
― Trend in problem logs mirrors timeframe of network challenges and recovery ― Enhanced focus on long-dwell cars ensures all cars benefit from fluidity gains
567 499
458 374
354 368
374
286
281
Customer service and commercial presence at key field location has aided communication and problem resolution Nearly 90% of last two weeks’ problem logs have been addressed and closed to-date
25
26
27
28
29
30
31
32
33
34
35
Weeks
Delayed Cars
11
Bad Order
Switching Issues
36
― Leaving more logs open through final destination ― Managing pipeline of customer concerns to full resolution
Westbound interchange ticked down in week 36, steady performance From
East St. Louis Daily Average Interchange Volume
800
To
Chicago Daily Average Interchange Volume
2,000 1,600
600
1,200
400
800 200
400
0 25
26
27
28
29
30
31
32
33
34
35
36
0 25
26
27
28
29
Weeks
32
33
34
35
36
Memphis
Daily Average Interchange Volume
Daily Average Interchange Volume
300
400
200
200
100
0
0 25
26
27
28
29
30
31
Weeks
12
31
Weeks
New Orleans 600
30
32
33
34
35
36
25
26
27
28
29
30
31
Weeks
32
33
34
35
36
Precision scheduled railroading to produce 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
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 Currently balancing between terminals’ improving efficiency and modest adjustments in traffic 13
flows to recover near-term 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
15
