STB UPDATE
AUGUST 28, 2017
2
Slow progression underway; poised to accelerate
Dwell showing regular improvement; other network metrics stable
Right Car Right Train moving higher
Crew and power resource levels are well matched to demand
Hump yards performing at a consistent level
Western terminals fluid, secondary congestion contained
Empty car fulfillment remains in similar range over last few weeks
Local pull and place performance trending up
Customer problem logs down week-over-week, though remain elevated
Interchange volumes and performance stable; however, Hurricane Harvey impacts anticipated
CSX experienced congestion challenges at Western corridor terminals from mid-late July
(weeks 29-31); original terminals now healthy and network recovery progressing
Dwell improved each of the last four weeks from height of challenges
3Note: Dwell and velocity displayed according to CSX methodology; explanation of CSX methodology can be found in appendix.
Two disruptive derailments occurred in weeks 31 and 32, detrimentally impacting network performance
Velocity (mph)
48
%
52
%
53
%
58
%
49
%
46
% 55
%
August 19 - 25
12
.8
13
.7
13
.5
12
.9
12
.9
13
.7
13
.5
August 19 - 25
11
.3
11
.6 13
.1
12
.3
11
.5
12
.2
11
65%
62%
64%
69%
66%
63%
64%
15.6 15.5 15.0 15.0 13.5 13.3 13.0 13.2 13.1
25 26 27 28 29 30 31 32 33
Weeks
On Time Originations (%)
Dwell (hours)
75%76%70%
66%58%59%
55%57%55%
25 26 27 28 29 30 31 32 33
Weeks
On Time Arrivals (%)
August 19 - 25
August 19 - 25
On-Time
+2 hrs
On-Time
+2 hrs
11.8 11.9 12.3 11.912.8 13.2 13.1 12.8 12.5
25 26 27 28 29 30 31 32 33
Weeks
86% 87% 85% 82%77% 74% 72% 72% 70%
25 26 27 28 29 30 31 32 33
Weeks
Weekly Average
72%
69% 70%
74%
76%
72% 73%
Right Car Right Train holding relatively stable; less relevant in PSR
4
Right Car Right Train1
75%
73% 73%
75%
73%72% 71%
70%
72%
25 26 27 28 29 30 31 32 33
Weeks
August 19 - 25
1 ‘Right Car Right Train’ is defined as the percentage of cars that departed from a yard in accordance with their car scheduling trip plan
Right Car Right Train is no longer a measure
that CSX uses to manage its operation
― 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
― Blocking integrity certifies that a train is built correctly
and shipments are headed to the correct location
― Managed through field supervision
Weekly Average
9,223
9,380
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
10.0%
8,900
9,100
9,300
9,500
9,700
9,900
Q1AVG
Q2AVG
25 26 27 28 29 30 31 32 33 34
Weeks
5
Resourcing appropriately to meet business needs
Power and crew availability steady in third quarter at approximately 99% and 95%, respectively
Q3 locomotive level stable; recently added engines
in response to incremental coal demand
T&E trend tracking normal seasonality; re-crew
rates remain at historic lows and stable
Train & Engine Headcount and Re-crew Rate1Active Locomotives
3,763
3,294
2,000
2,400
2,800
3,200
3,600
4,000
Q1AVG
Q2AVG
25 26 27 28 29 30 31 32 33 34
Weeks
1 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)
6
Hump yard performance steady
CSX Hump Terminal Overview
Transitioned to flat-switching operations
Hump terminals
Selkirk, NY
Cumberland, MD
Hamlet, NC
Waycross, GA
Atlanta, GABirmingham, AL
Nashville, TN
Louisville, KY
Avon, IN
Cincinnati, OH
Willard, OH
Toledo, OH
19.5 19.020.0
18.018.8 19.3 19.0
19.919.0
25 26 27 28 29 30 31 32 33
Weeks
Dwell at Hump Terminals1
Key hump productivity and efficiency measures
performing well
― Arrive-to-hump, a measure of fluidity and processing efficiency,
remains stable from prior week
― Cars per man hour at hump yards accelerating through the quarter,
indicating yard productivity with higher volume at remaining humps
― Aggregate dwell time stable, despite elevated volumes at
Cincinnati recently
1 Dwell displayed according to CSX methodology; explanation of CSX methodology can be found in appendix
Absolute number of humps not “good” or “bad”; goal is
best mix of hump and flat yards for processing efficiency
Weekly Average
19
.1 20
.8
21
.2
19
.7 21
.5
22
.0
18
.3
August 19 – 25
Key terminal productivity and performance measures
largely recovered in former “trouble” spots― Dwell recovered and in line with expectations
― Greater yard productivity evident in cars per man-hour processed
Train plan addressed secondary concerns― Leveraging Avon as near-term offset of increased volume flow
through Russell, Columbus and Louisville
― Dwell at these three locations down 13% week-over-week
7
Western performance improved; plan changes alleviating congestion
16.016.9 16.8 17.3
19.9
22.1
19.5
16.0
14.0
25 26 27 28 29 30 31 32 33Weeks
Dwell at Western Terminals1
Western Corridor Key Terminals
Birmingham, AL
Nashville, TN
Avon, IN
Evansville, IN
Montgomery, AL
Mobile, AL
Western terminals
1 Dwell displayed according to CSX methodology; explanation of CSX methodology can be found in appendix
Weekly Average
12
.1
12
.2
15
.9
13
.8 15
.8
14
.2
12
.4
August 19 – 25
8
Car order fill to improve with reduced dwell
40%
45%
50%
55%
60%
65%
70%
75%
80%
85%
90%
2,000
3,000
4,000
5,000
6,000
7,000
25 26 27 28 29 30 31 32 33 34
Weeks
Weekly Orders Normalized Order Fill %
Weekly Car Orders and Normalized Fill Rate
Q1 Avg. Weekly Car Orders
Orders remain detached from demand
― Car orders up ~40% in Q3 vs. Q1 2017
― Merchandise carload expectations down
slightly in comparable timeframe
Empty car dwell increasing modestly
at customer locations; down on CSX
― Return of empty customer dwell indicates
reducing urgency of need; prevention of
shutdown situations
― Reduction of empty railroad dwell indicates
improving network flow of empty cars
Normalized fill rate1 ranging 70-85%
― Process evaluation underway to realign order
level with demand and improve fulfillment
accountability
Cars
Ordered
Normalized
Fill Rate
1 Normalized fill rate is a proxy of demand fulfillment against historical/expected order levels, as current order levels have disconnected with demand
9
Last mile performance stable and improving
Local Service Measurement1
95%90%
84% 83%80% 81% 81% 80% 79% 78%
82%85%
Q1AVG
Q2AVG
25 26 27 28 29 30 31 32 33 34
Weeks
1 ‘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
Local Service Measurement (LSM) is no longer
a metric that CSX uses to manage its operation
― 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
Reliable pull and place expected as part of
service to customers
10
Customer problem logs beginning to recede
354 368
286
374
458
570 563537
567
499
25 26 27 28 29 30 31 32 33 34
Weeks
Delayed Cars Bad Order Switching Issues
Customer InquiriesDaily Average Log Volume
Delayed cars have been most frequent concern
― Trend in problem logs mirrors timeframe of network
challenges and recovery
― Enhanced focus on long-dwell cars ensures all cars
benefit from fluidity gains
Customer service and commercial presence at
key field location has aided communication and
problem resolution
― New location assignments this week include: Columbus,
Russell, Avon, Evansville
Nearly 90% of problem logs have been
addressed and closed to-date
― Managing pipeline of customer concerns to full resolution
Interchange volume at gateway locations similar to prior weeks
0
200
400
600
800
25 26 27 28 29 30 31 32 33 34
Weeks
East St. LouisDaily Average Interchange Volume
From To
0
200
400
600
25 26 27 28 29 30 31 32 33 34
Weeks
New OrleansDaily Average Interchange Volume
0
400
800
1,200
1,600
2,000
25 26 27 28 29 30 31 32 33 34
Weeks
Chicago Daily Average Interchange Volume
0
100
200
300
25 26 27 28 29 30 31 32 33 34
Weeks
MemphisDaily Average Interchange Volume
11
12
Precision scheduled railroading to produce service improvement
Improve
Service
Operate
Safely
Control
Costs
Drive Asset
Utilization
Develop
People
Operational Focus
Terminal
Fluidity
Balanced
Train Plan
Service Improvements
Rolling Stock
UtilizationPeople
Efficiency
Fuel
OptimizationTrain
Density
Improved
FrequencyBetter
Reliability
Faster
TransitQuicker
Turnaround
Productivity Improvements&
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
flows to recover near-term service
Improved execution on this foundation to drive long-term service and productivity improvements
APPENDIX
14
Velocity
Former Line of road miles per hour
Current
Total miles traveled per hour,
including intermediate dwell of
the train
Change
Reason
Includes full trip of a train and
ability to diagnose overall speed
profile (in support of
improvement in asset cycle)
Effect on
MetricReported velocity will be lower
CSX has changed methodology on some metrics reported publicly
Dwell
FormerCar 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 all dwell with ability to
diagnose all events impacting car
movement (in support of
improvement in asset cycle)
Effect on
MetricReported dwell will be lower
Restated historical data in new methodology available on csx.com/servicemetrics
Cars Online
FormerAll 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
More accurate measurement of
active cars on line, i.e. cars for
which CSX is focused on real-
time, efficient movement
Effect on
Metric
Reported cars online will be
lower