The hits just keep coming with another arctic blast this week and some extensive flooding, primary impacting Norfolk Southern in Southern West Virginia, Eastern Kentucky, Southwest Virginia and Eastern Ohio, resulting in track outages.
None of the rails have been spared from the tough weather, as they all attested to at the Barclays conference. The CEOs of NS, CSX and CN, in particular, all lowered near-term expectations as they dig out and work down car backlogs over the next couple of weeks. Winter happens every year, and all the above is normal. The good news is that the industry entered winter in the best shape in years, which will no doubt pay dividends in terms of recoverability and the post-winter reacceleration in the networks.
CSX Reroutes
Our current, primary, focus remains CSX’s handicapped network, as it struggles to maintain efficient fluidity while rerouting around both the closed Blue Ridge subdivision (Hurricane Helene damage) and Baltimore’s Howard Street Tunnel (clearance work). Throw winter into the mix and you’ve got a bad short-term scenario.
The negative highlights in the week ending Feb. 14 included:
- Network velocity that remains mired at a two and a half year low.
- Elevated terminal dwell and, in particular, average hump yard dwell that last week was almost on par with where it peaked during Hurricane Helene (ignoring the seasonal Christmas spike). The biggest one: Rice Yard at Waycross, Ga., increased again to 33 hours last week versus its historical efficient benchmark in the low-to-mid 20s.
- Slow-to-move cars (48-hour delays) hit 2.5% of the fleet last week, a high we also haven’t seen since the 2022 Service Crisis (again excluding artificial Christmas spikes).
- Average coal train speed is only modestly above its two-year low.
It’s a discouraging picture that will probably deteriorate further, which will capture the data from this week’s cold snap and flooding in Kentucky, Ohio, Virginia and West Virginia. On the positive side, getting out of winter will obviously help over the next few weeks, as will adjustments and fine-tuning of the I-95 corridor reroutes that are no doubt taking place.
