The board, an independent and bipartisan federal agency charged with the economic regulation of various modes of surface transportation, primarily freight rail, announced the meeting April 7 in the light of indications of poor performance data.
“Rail network reliability is essential to the Nation’s economy and is a foremost priority of the Board. In recent weeks, the Board has heard informally from a broad range of stakeholders about inconsistent and unreliable rail service. The Board has also received reports from the Secretary of Agriculture and other stakeholders about the serious impact of these service trends on rail users, particularly with respect to shippers of agricultural and energy products. These reports have been validated by the Board’s weekly rail service performance data.”
Board Chairman Martin Oberman went into additional detail about how job cuts in particular have hampered the carriers.
“I have raised concerns about the primacy Class I railroads have placed on lowering their operating ratios and satisfying their shareholders even at the cost of their customers. Part of that strategy has involved cutting their work force to the bare bones in order to reduce costs,” he said. “Over the last six years, the Class Is collectively have reduced their work force by 29% – that is about 45,000 employees cut from the payrolls.
“In my view, all of this has directly contributed to where we are today – rail users experiencing serious deteriorations in rail service because, on too many parts of their networks, the railroads simply do not have a sufficient number of employees.”
Carriers summoned to appear include BNSF Railway Company, CSX Transportation, Inc., Norfolk Southern Railway Company, and Union Pacific Railroad Company. Executive-level officials from the other three Class Is also were invited to attend, as were labor organizations and shippers.
The hearing will take place at the Board’s headquarters in Washington, D.C., with each session beginning at 9:30 a.m.
An NBC News report released March 7 detailed a nonprofit’s analysis that looked into how America’s largest railroads profited during last year’s supply chain crisis in conjunction with the continued enactment of their Precision Scheduled Railroading (PSR) scheme.
Nonprofit group Accountable.US delved into the reasons why — namely that the Class Is collected more than $1.1 billion in demurrage fees thanks to supply-chain bottlenecks. The two largest carriers in the western U.S., BNSF and Union Pacific, also reported record profits in 2021 in their end-of-year earnings reports.
“Before the rail industry’s fees set a record during the pandemic, they had already increased by over 30% since 2000, all while railroads’ costs have only increased by 3%,” the Accountable.US report stated. “Railroads have used market power to cut costs — known as lowering their Operating Ratios — spending about $46 billion more on shareholder handouts than on maintenance and equipment since 2010.”
In addition to diving in on the details of the stock buybacks and other components of PSR, the Accountable.US analysis also went into additional details about the extent of the railroads’ lobbying efforts — all told, Class Is spent a combined total of $15.5 million to influence policy on Capitol Hill.
4th Quarter 2021 Net Earnings: Increased 13% to $1.7 billion from $1.5 billion Diluted Earnings Per Share:n/a – BNSF is not publicly traded Revenue:Increased 11% to $6.3 billion from $5.7 billion Operating Income:Increased 12% to $2.4 billion from $2.2 billion Operating Expenses:Increased 10% to $3.9 billion from $3.5 billion Operating Ratio:Improved to 60.0% from 60.3%
2021 Annual Earnings Net Earnings: Increased 16% to $6.0 billion from $5.2 billion Diluted Earnings Per Share: n/a – BNSF is not publicly traded Revenue: Increased 12% to $23.3 billion from $20.9 billion Operating Income: Increased 14% to $8.8 billion from $7.7 billion Operating Expenses: Increased 10% to $14.5 billion from $13.1 billion Operating Ratio: Improved to 60.9% from 61.6% Read BNSF’s full earnings report.
4th Quarter 2021 Net Earnings: Increased 17% to C$1.20 billion from C$1.02 billion Diluted Earnings Per Share: Increased 18% to $1.69 per share from $1.43 per share Revenue: Increased 3% to C$3.75 billion from C$3.66 billion Operating Income: Increased 11% to a record C$1.57 billion from C$1.41 billion Operating Expenses: Decreased 1% to C$2.19 billion from C$2.25 billion Operating Ratio: Improved 3.1 points to 58.3% from 61.4%
2021 Annual Earnings Net Earnings: Increased 37% to C$4.90 billion from C$3.60 billion Diluted Earnings Per Share: Increased 38% to $6.89 per share from $5.00 per share Revenue: Increased 5% to C$14.48 billion from C$13.82 billion Operating Income: Increased 18% to C$5.62 billion from C$4.78 billion Operating Expenses: Decreased 2% to C$8.86 billion from C$9.04 billion Operating Ratio: Improved 4.2 points to 61.2% from 65.4% Read CN’s full earnings report.
4th Quarter 2021 Net Earnings: Decreased 34% to C$532 million from C$802 million Diluted Earnings Per Share: Decreased 38% to $0.74 per share from $1.19 per share Revenue: Increased 1% to C$2.04 billion from C$2.01 billion Operating Income: Decreased 10% to C$832 million from C$928 million Operating Expenses: Increased 11% to C$1.21 billion from C$1.08 billion Operating Ratio: Worsened 530 basis points to 59.2% from 53.9%
2021 Annual Earnings Net Earnings: Increased 17% to C$2.9 billion from C$2.44 billion Diluted Earnings Per Share: Increased 16% to $4.18 per share from $3.59 per share Revenue: Increased 4% to C$8.0 billion from C$7.71 billion Operating Income: Decreased 3% to C$3.21 billion from C$3.31 billion Operating Expenses: Increased 9% to C$4.80 billion from C$4.40 billion Operating Ratio: Worsened 280 basis points to 59.9% from 57.1% Read CP’s full earnings report.
4th Quarter 2021 Net Earnings: Increased 23% to $934 million from $760 million Earnings Per Share: Increased 27% to $0.42 per share from $0.33 per share Revenue: Increased 21% to $3.43 billion from $2.83 billion Operating Income: Increased 12% to $1.37 billion from $1.22 billion Operating Expenses: Increased 28% to $2.1 billion from $1.6 billion Operating Ratio: Worsened to 60.1% from 57.0%
2021 Annual Earnings Net Earnings: Increased 37% to $3.8 billion from $2.8 billion Earnings Per Share: Increased 40% to $1.68 per share from $1.20 per share Revenue: Increased 18% to $12.52 billion from $10.58 billion Operating Income: Increased 28% to $5.6 billion from $4.4 billion Operating Expenses: Increased 11% to $6.9 billion from $6.2 billion Operating Ratio: Improved to 55.3% from 58.8% Read CSX’s full earnings report.
4th Quarter 2021 Net Earnings: Increased 258% to $595.1 million from $166.3 million Earnings Per Share:On December 14, 2021, Canadian Pacific Railway acquired the outstanding common and preferred stock of KCS. Therefore, earnings per share data is not presented because the company does not have any outstanding or issued publicly traded stock. Revenue: Increased 8% to $747.8 million from $693.4 million Operating Income: Increased 209% to $810.6 million from $262.3 million Operating Expenses: Decreased 115% to a negative $62.8 million from $431.1 million due to the merger Operating Ratio: Improved 70.6 points to –8.4% from 62.2%
2021 Annual Earnings Net Earnings: Decreased 15% to $527 million from $619 million Earnings Per Share:On December 14, 2021, Canadian Pacific Railway acquired the outstanding common and preferred stock of KCS. Therefore, earnings per share data is not presented because the company does not have any outstanding or issued publicly traded stock. Revenue: Increased 12% to $2.95 billion from $2.63 billion Operating Income: Decreased 12% to $884 million from $1.00 billion Operating Expenses: Increased 27% to $2.06 billion from $1.63 billion Operating Ratio: Worsened 8.1 points to 70.0% from 61.9% Read KCS’s full earnings report.
4th Quarter 2021 Net Earnings: Increased 13% to $760 million from $671 million Diluted Earnings Per Share: Increased 18% to $3.12 per share from $2.64 per share Revenue: Increased 11% to $2.9 billion from $2.6 billion Operating Income: Increased 15% to a 4th quarter record of $1.1 billion from $1.0 billion Operating Expenses: Increased 8% to $1.7 billion from $1.59 billion Operating Ratio: Improved 2% to a 4th quarter record 60.4% from 61.8%
2021 Annual Earnings Net Earnings: Increased 27% to $3 billion from $2 billion Diluted Earnings Per Share: Increased 31% to $12.11 per share from $7.84 per share Revenue: Increased 14% to $11.1 billion from $9.8 billion Operating Income: Increased 28% to a record $4.4 billion from $3.0 billion Operating Expenses: Decreased 1% to $6.7 billion from $6.8 billion Operating Ratio: Improved 7% to an all-time record of 60.1% from 69.3% Read NS’s full earnings report.
4th Quarter 2021 Net Earnings: Increased 24% to $1.7 billion from $1.4 billion Earnings Per Share: Increased 30% to $2.67 per share from $2.05 per share Revenue: Increased 12% to $5.7 billion from $5.1 billion Operating Income: Increased 22% to $2.4 billion from $2.0 billion Operating Expenses: Increased 5% to $3.3 billion from $3.1 billion Operating Ratio: Improved 3.6 points to 57.4% from 61.0%
2021 Annual Earnings Net Earnings: Increased 22% to $6.5 billion from $5.3 billion Earnings Per Share: Increased 26% to $9.98 per share from $7.90 per share Revenue: Increased 12% to $21.8 billion from $19.5 billion Operating Income: Increased 19% to $9.3 billion from $7.8 billion Operating Expenses: Increased 7% to $12.5 billion from $11.7 billion Operating Ratio: Improved 2.7 points to 57.2% from 59.9%
“The Union Pacific team concluded its most profitable year ever in 2021. We produced double-digit fourth-quarter revenue growth by leveraging our great rail franchise to generate positive business mix and core pricing gains,” UP CEO Lance Fritz said. Read UP’s full earnings report.
Notes:
Operating ratio is a railroad’s operating expenses expressed as a percentage of operating revenue, and is considered by economists to be the basic measure of carrier profitability. The lower the operating ratio, the more efficient the railroad.
All comparisons are made to 2020’s fourth-quarter and 2020 year-end results respectively for each railroad.
All figures for CN & CP are in Canadian currency, except for earnings per share.
CLEVELAND, October 15, 2021 — The Transportation Division of the International Association of Sheet Metal, Air, Rail, and Transportation Workers (SMART-TD) and the Brotherhood of Locomotive Engineers and Trainmen (BLET) are jointly taking on Union Pacific Railroad (UP) over a series of unilateral and unlawful actions taken by the carrier recently. SMART-TD President Jeremy Ferguson and BLET National President Dennis Pierce issued the following joint statement regarding their action:
“Over the past two weeks, the Union Pacific Railroad seems to have forgotten that it is not Walmart. The railroad has unilaterally changed pay provisions for vaccinated employees who experience a breakthrough COVID infection due to workplace exposure. It has ordered all UP employees to report that they are fully vaccinated by December 8th, or risk being medically disqualified from work. And, instead of negotiating with us as the law requires, the Carrier is directly dealing with its employees by offering a ‘financial incentive’ for compliance with its unilateral mandate.
“We generally support our members getting the vaccine. However, we have several objections to UP’s unilateral implementation of their policies mandating them and illegally dealing directly with its represented employees. The members of our Unions — including members who already are vaccinated — are irate over UP’s outrageous conduct.
“We have been in contract negotiations with UP since November of 2019, and federal law absolutely bars railroads from changing rates of pay, rules and working conditions while negotiations are ongoing. Not only is UP in violation of the law, it has explicitly spurned our demands that these matters be bargained. We have filed suit today in the United States District Court for Northern District of Illinois, Eastern Division, in an effort to stop UP’s lawlessness in its tracks.”
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The SMART Transportation Division is comprised of approximately 125,000 active and retired members of the former United Transportation Union, who work in a variety of crafts in the transportation industry. The Brotherhood of Locomotive Engineers and Trainmen represents nearly 57,000 professional locomotive engineers and trainmen throughout the United States. The BLET is the founding member of the Rail Conference, International Brotherhood of Teamsters.
Attendees participate in an educational session in Topeka, Kan., on June 23. (Photo courtesy Zach Nagy) The leadership of GCA-953 (Union Pacific) have kicked off a slate of educational sessions for local officers and members. The first of six sessions took place June 22 and 23 in Topeka, Kan., with General Chairperson Luke Edington, Associate GC Ian Reynolds and Sr. Vice GC Zach Nagy hosting and teaching the classes. The curriculum included training on serving as a union officer, an overview of officer duties, website training, filing a proper time claim, writing a discipline appeal and a mock arbitration session. Transportation Division President Jeremy Ferguson made a guest appearance through Zoom, Vice President Brent Leonard spoke in person and Larry Romine from Reliable Retirement spoke through Zoom. “We had attendees including local presidents, local chairpersons, vice local chairpersons and secretary/treasurers from four states in attendance,” Nagy said. The GCA has plans for five more sessions in Omaha, Cheyenne, Salt Lake City, Portland and Waukesha, Wis., as the summer progresses. For more information about time and locations, email Nagy at znagy@utu953.org.
Net Earnings: Decreased to $1.131 billion from $1.338 billion. Revenue: Decreased to $4.602 billion from $5.893 billion. Operating Income: Decreased to $1.73 billion from $2.007 billion. Operating Expenses:Decreased to $2.872 billion from $3.886 billion. Operating Ratio: Improved by 3.7 points to 61.1%. Link to read BNSF’s full earnings report.
Net Earnings: Decreased to C$908 million from C$1.25 billion. Earnings Per Share: Diluted earnings per share decreased 59% to C$0.77 from C$1.88 and adjusted diluted EPS decreased 26% to C$1.28 from C$1.73. Revenue: Decreased 19% to C$3.21 billion from C$3.96 billion. Operating Income: Decreased 53% to C$785 million from C$1.27 billion. Operating Expenses: Increased 6% to C$2.42 billion. Operating Ratio: Declined by 18 points to 75.5%; adjusted operating ratio declined 2.9 points to 60.4% from 57.5%. Link to read CN’s full earnings report.
Net Earnings: Decreased to C$635 million from C$724 million. Earnings Per Share: Diluted earnings per share decreased 10% to $4.66; adjusted diluted earnings per share decreased 5% to $4.30. Revenue: Decreased 9% to C$1.79 billion from C$1.98 billion. Operating Income: Decreased to C$770 million from C$822 million. Operating Expenses: Decreased to C$1.02 billion from C$1.16 billion. Operating Ratio: Improved 140 basis points to 57%. Link to read CP’s full earnings report.
Net Earnings: Decreased to $499 million from $870 million. Earnings Per Share: Decreased to $0.65 from $1.08. Revenue: Decreased 26% to $2.26 billion from $3.06 billion. Operating Income: Decreased 37% to $828 million from $1.31 billion. Operating Expenses: Decreased 19% to $1.43 billion from $1.76 billion. Operating Ratio: Declined 5.9 points to 63.3%. Link to read CSX’s full earnings report.
Net Earnings: Decreased to $109.7 million from $128.7 million. Earnings Per Share: Decreased to $1.16 per diluted share from $1.28. Revenue: Decreased to $547.9 million from $714 million. Operating Income: Decreased to $180.4 million from $208 million. Operating Expenses: Decreased to $367.5 million from $506 million. Operating Ratio: Improved 3.8 points to 67.1% from 70.9%; adjusted operating ratio worsened 1.5 points to 65.2% from 63.7%. Link to read KCS’s full earnings report.
Net Earnings: Decreased to $392 million from $722 million. Earnings Per Share: Diluted earnings per share decreased to $1.53 from $2.70. Revenue: Decreased 29% to $2.1 billion from $2.9 billion. Operating Income: Decreased to $610 million from $1.1 billion. Operating Expenses: Decreased 21% to $1.5 billion from $1.9 billion. Operating Ratio: Worsened to 70.7% from 63.6%. Link to read NS’s full earnings report.
Net Earnings: Decreased to $1.13 billion from $1.57 billion. Earnings Per Share: Decreased to $1.67 per diluted share from $2.22 per diluted share. Revenue: Decreased 24% to $4.2 billion from $5.6 billion. Operating Income: Decreased 28% to $1.13 billion from $1.57 billion. Operating Expenses: Decreased 22% to $2.59 billion from $3.34 billion. Operating Ratio: Worsened 1.4 points to 61.0% from 59.6%. Link to read UP’s full earnings report.
Notes:
BNSF’s earnings report had not been released as of July 29, 2020. This post will be updated when the information becomes available.
Operating ratio is a railroad’s operating expenses expressed as a percentage of operating revenue, and is considered by economists to be the basic measure of carrier profitability. The lower the operating ratio, the more efficient the railroad.
All comparisons are made to 2019’s second-quarter results for each railroad.
All figures for CN & CP are in Canadian currency, except for earnings per share for CP
Union Pacific has announced that a 50-year-old man that works in UP’s Bailey Yard in North Platte, Neb., has tested positive for COVID-19. The employee and a number of co-workers who came into contact with him are currently quarantined at home. It’s suspected that the man got the virus while traveling to California and vacationing on a cruise ship. UP reports that the man’s work areas have been disinfected and sanitized. “It’s unfathomable that rail carriers have not yet implemented all CDC guidelines regarding sanitation and COVID-19 prevention efforts from the outset,” SMART Transportation Division President Jeremy Ferguson said. “We are making every effort during this Federal Railroad Administration-declared emergency to get our membership and rail workers the protections they need.” The man’s name has not been released. Click here to read more from The North Platte Telegraph or from NBC Nebraska.
NORTH OLMSTED, Ohio — The team negotiating the next National Rail Contract which will affect more than 40,000 SMART Transportation Division members has been finalized by the union’s leadership. The team will be led by TD President Jeremy Ferguson with the assistance of Vice Presidents Brent Leonard; John J. Whitaker III; Chadrick Adams; Jamie C. Modesitt; Joe M. Lopez and David B. Wier Jr. Also part of the team are five General Chairpersons, Mike LaPresta (BNSF); Gary Crest (Union Pacific); Roger Crawford (Illinois Central); Thomas Gholson (Norfolk Southern) and Christopher Bartz (yardmasters). “We are prepared to do whatever it takes to get the most out of this round of national contract talks,” President Ferguson said. “It will be a challenging process and it could be quite contentious at times. However, we on the negotiating team are confident that as we work through the process we can achieve a positive result.” The opening meeting of negotiations is scheduled for February 26 and 27 in Washington, D.C., with talks occurring in Cleveland, Omaha, Washington, D.C. and Chicago, as the year progresses. SMART-TD is part of a Coordinated Bargaining Coalition that consists of it and nine other unions representing rail labor. Carriers BNSF, CSX, Kansas City Southern, Canadian National, Norfolk Southern, Soo Line, Union Pacific and numerous smaller railroads are represented by the National Carriers’ Conference Committee (NCCC) during negotiations. In related news, CSXT will not be part of national bargaining, except for health and welfare issues. For the wages and rules portion, SMART-TD and CSX have agreed to begin bargaining locally on behalf of trainmen starting Jan. 21, 2020. A joint meeting for the negotiating parties regarding facilitated bargaining is scheduled in Jacksonville, Fla., on January 22 and 23. Additional meeting dates for these negotiations are currently under discussion, and a tentative schedule will be set in the near future. Neither the SMART-TD nor CSX have exchanged any proposals, and an agenda for the subjects to be discussed during these contract talks, which are separate from the National Rail Contract negotiations, has yet to be finalized.
Class I carrier Union Pacific announced Monday that it has completed implementation of Positive Train Control (PTC) on all federally mandated freight and passenger routes requiring the collision avoidance technology. The carrier still must achieve full interoperability, that is, its PTC system must be able to successfully interact with those systems used by other carriers. The carrier reports that 16 of 25 railroads it hosts are compliant, encompassing 85% of Union Pacific’s interoperable PTC train miles, and says that full interoperability in conjunction with the other carriers is expected by mid-2020. PTC is designed to prevent:
Train-to-train collisions;
Derailments caused by excessive speed;
Accidents that can occur if trains are routed down the incorrect track;
Unauthorized train movements on tracks undergoing maintenance
From left, Local 1409 Legislative Representative Dan Bonawitz Jr., TD Vice President Brent Leonard, Washington State Legislative Director Herb Krohn, TD President Jeremy Ferguson and Kansas State Legislative Director Ty Dragoo participate in an informational picket on Tuesday, Nov. 5, in Kansas City. General President Joseph Sellers Jr. and TD President Jeremy Ferguson both participated in a town hall meeting and informational rally in Kansas City on Nov. 4 and 5 to draw attention to Union Pacific’s closure of the Neff Yard that resulted in about 200 lost jobs. The event received local media coverage and was a success, said Kansas State Legislative Director Ty Dragoo. “it was a great event,” Dragoo said. “We had over 170 members there. We’re definitely moving forward.” More coverage of the event will be forthcoming.
