STB UPDATE
JANUARY 23, 2018
2
Network continued to perform at high levels
Dwell improved, velocity remained healthy following record prior week
Right Car Right Train lower week-over-week
Crew and power resource levels well matched to demand
Hump yard performance steady
Western terminals performing well
Car fulfillment settled higher, averaging 97% year-to-date
Local pull and place performance stable
Customer problem logs at normal levels
Interchange volumes current and gateways fluid
Network continues to perform well through widespread extreme cold temperatures and snow
15.1
18.018.7
17.3
17.7
18.0
17.9
17.9
17.5
17.4
10.0
12.0
14.0
16.0
18.0
20.0
22.0
11.3 11.5 10.8
9.0
10.8 11
.9
11.0 11.5
10.9
10.2
6.0
8.0
10.0
12.0
14.0
16.0
18.0
3Note: Dwell and velocity displayed according to CSX methodology; explanation of CSX methodology can be found at csx.com/servicemetrics. 2017 dwell and velocity exclude the Hurricane Irma-impacted period for terminals that held cars and specific trains held through storm, respectively.
Velocity (mph)
69% 73%78%
65% 70
%
72%
69%
67%
66%
67%
20%
40%
60%
80%
100%80% 81% 84%
76%
76% 81
%
83%
80%
82%
82%
20%
40%
60%
80%
100%
On Time Originations (%)
Dwell (hours)
On Time Arrivals (%)
On-Time
+2 hrs
On-Time
+2 hrs
Weekly Average
Jan. 13 – Jan. 192017
Jan. 13 – Jan. 192017 Jan. 13 – Jan. 192017
2017 Jan. 13 – Jan. 191 1
1 1Weeks
Weeks Weeks
Weeks
Dwell improved, velocity remained healthy following record prior week
2 2
2 2
79%
75%77%
72%
67%
66%
72% 73
%
71% 73
%50%
55%
60%
65%
70%
75%
80%
85%
90%
Jan. 13 – Jan. 19
Right Car Right Train lower week-over-week
4
Right Car Right Train1
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 scheduled railroading, 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 scheduled railroading
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
2017 1Weeks
2
9,365
8,760 8,680 8,612
0%
2%
4%
6%
8%
10%
12%
7,000
7,400
7,800
8,200
8,600
9,000
9,400
9,800
2017 1 2 3 4 5 6
3,368
3,025 2,979 2,881
1,800
2,200
2,600
3,000
3,400
3,800
2017 1 2 3 4 5 6
5
Resourcing appropriately to meet business needs
Power and crew availability steady at approximately 99% and 95%, respectively
Train & Engine Headcount and Re-crew Rate1Active Locomotives
1 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)
Locomotive level coming down in concert with network velocity improvement
Recent headcount decline driven by train staffing efficiency and adjustments to extra boards
2018 Weeks2018 Weeks
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
1 Dwell displayed according to CSX methodology; explanation of CSX methodology can be found at csx.com/servicemetrics. 2017 dwell excludes the Hurricane Irma-impacted period for terminals that held cars through the storm.
Absolute number of humps not “good” or “bad”; goal is best mix of hump and flat yards for processing efficiency
Dwell at Hump Terminals1
Key hump productivity and efficiency measures performing well
Total hump yard volumes back to normal levels after holiday, remain well below capacity of yards
20.919.6 19.2 20
.3 21.8 23
.9
21.2 22
.9
22.9
21.5
6.0
10.0
14.0
18.0
22.0
26.0
30.0Weekly Average
Jan. 13 – Jan. 192017 1Weeks
2
14.9
11.5 11.0
12.9 14
.6
14.4
11.4
13.9
17.1
12.2
6.0
10.0
14.0
18.0
22.0
Key terminal productivity and performance measures healthy, dwell remains well below 2017
7
Western terminals performing well
Western Corridor Key Terminals
Birmingham, AL
Nashville, TN
Avon, IN
Montgomery, AL
Mobile, AL
Key Western terminals
1 Dwell displayed according to CSX methodology; explanation of CSX methodology can be found at csx.com/servicemetrics. 2017 dwell excludes the Hurricane Irma-impacted period for terminals that held cars through the storm.
Weekly Average
Dwell at Western Terminals1
Jan. 13 – Jan. 192017 1Weeks
2
50%
60%
70%
80%
90%
100%
110%
0
1,000
2,000
3,000
4,000
5,000
6,000
2017 1 2 3 4 5 6
Weekly Orders Customer Empty Idles (> 24 hours) 2017 Blended Fill % Order Fill %
8
Car fulfillment settled higher, averaging 97% year-to-date
Weekly Car Orders, Customer Empty Idles, and Fill Rate1
Cars Ordered/Idle
Order Fill Rates
Over 300 orders filled in week 3 against week 2 open orders, increasing fill to 101%
― Car flows fully recovered following holiday
Empty car dwell remains elevated at customer locations
― Empty idle cars at a given customer held >24 hours considered available to fill that customer’s orders
2018 Weeks
1 2017 orders and fill rate normalized for Weeks 14-44 against historical/expected order levels (Q1 2017), as orders were disconnected with demand; starting week 45, improved process leaves orders open for two weeks, counts empty idle cars > 24 hours at a customer location as a filled order for that day
9
Last mile performance measure stable
Local Service Measurement1
87%
74%
86% 86%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2017 1 2 3 4 5 6
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
2018 Weeks
Local Service Measurement (LSM) is not a primary metric that CSX uses to manage its operation
― In scheduled railroading, focus on end-to-end transit and customer expectations
However, reliable pull and place expected as part of service to customers
10
Customer problem logs remained at normal levels
Customer InquiriesDaily Average Log Volume
Improved communication allowing for faster, more local resolution
― Accountability for resolution of customer issues resides with field responsibility
― Escalating and resolving critical issues with senior leadership
Enhancing key customer tools and aligning workstreams to allow for easier, more direct connections
570 Total Logs in Week 30 2017 at height of service challenges
2018 Weeks
284223
271252
2017 1 2 3 4 5 6
Delayed Cars Bad Order Switching Issues
Interchanges current and performing to expectations
0
200
400
600
800
2017 1 2 3 4 5 6
East St. LouisDaily Average Interchange Volume
0
200
400
600
2017 1 2 3 4 5 6
New OrleansDaily Average Interchange Volume
0
400
800
1,200
1,600
2,000
2017 1 2 3 4 5 6
Chicago Daily Average Interchange Volume
0
100
200
300
2017 1 2 3 4 5 6
MemphisDaily Average Interchange Volume
11
2018 Weeks
2018 Weeks 2018 Weeks
2018 Weeks
12
Scheduled railroading producing service improvement
ImproveService
OperateSafely
ControlCosts
Drive AssetUtilization
DevelopPeople
Operational Focus
TerminalFluidity
BalancedTrain Plan
Service Improvements
Rolling StockUtilization
PeopleEfficiency
FuelOptimization
TrainDensity
ImprovedFrequency
BetterReliability
FasterTransit
QuickerTurnaround
Productivity Improvements&
Accomplishments in 2017: realigned service frequency, balanced train plan, improved terminal efficiency
Improved execution on this foundation to drive long-term service and productivity improvements