On May 27, the chairman of the US Surface Transportation Board (STB) sent a letter to each of the Class I railroads expressing concerns about rail service problems, as reported by shippers. The letter indicated: “Although many shippers have reported that railroads are providing consistent and dependable service, the Board has also received concerning reports from a meaningful number of rail customers of subpar performance, including missed switches, railcars delayed at intermediate yards or interchanges, extended out-of-route movements, and prolonged dwell at origin for some unit train traffic.  Additionally, we have been made aware of instances of significant congestion at various intermodal facilities, which has resulted in delayed train arrivals and disruptions to container availability.  I recognize that these rail service challenges, at least to some extent, have been related to workforce reductions resulting from COVID-19 cases, quarantines, and furloughs based on the temporary decline in demand and the resultant adjustments made by railroads in nearly every facet of their businesses. “ The letter concluded with a request for a response detailing a number of factors related to service and performance.

Shortly thereafter, the American Chemistry Council wrote to STB in early June. Among other comments, they indicated responses from their members indicated: “Among companies that responded, 93% report that they have experienced significant rail service challenges within the last six months. While numerous railroads were mentioned, concerns are not evenly spread. Nearly all respondents (86%) reported problems with CSX, with most characterizing that railroad as a particular concern. The next most-cited railroad was KCS/KCSM (57%), followed by NS (43%).”

Here are excerpts from certain responses to the May 27th letter:

CSX: “CSX’s T&E active staffing levels have been brought back to within 4% of the pre-pandemic levels (6,851 now versus 7,132 March 2020) and we continue to hire and train employees in an effort to get ahead of rising demand. As of June 1, 2021less than 1% of CSX T&E employees remain furloughed. The few places they remain on furlough are in locations with less volume recovery.”

Union Pacific: “Though we streamlined our administrative and management staff over the last three years, we increased our freight car velocity by 5%, decreased terminal dwell times by 21%, increased locomotive productivity by 30%, and increased workforce productivity by 19%.”

BNSF: “BNSF responded with appropriate urgency last spring as the pandemic caused freight demand to decline quite rapidly; we adjusted our employee and equipment resources to match the rapidly changing freight volumes.  As those volumes began to recover and gathered steam heading into the fourth quarter of 2020 and early 2021, BNSF similarly flexed to bring back employees and deploy stored assets to handle customer demand.”

CP: “As reflected in our service performance, CP has not been lacking in employee resources. We have recalled the vast majority of CP employees who were furloughed as a result of the pandemic. CP currently has1034 train and engine (“T&E”) employees on the roster in the United States, 42of whom are on furlough, a sharp reduction from the 375 T&E employees who were on furlough at the beginning of Q3 2020. Similarly, of CP’s 898 engineering employees in the US, only 14 remain on furlough. In the mechanical ranks, CP has 380 employees in the US, and only 8 remain on furlough. For the remainder of 2021, CP anticipates hiring approximately 110 T&E employees, 60 engineering employees, and 20 mechanical employees in the US. 2022 hiring plans are being developed.”

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