Posts Tagged ‘BNSF’

Class 1 Merger Talk Heating Up

July 23, 2025

News reports had indicated that the long-awaited final round of Class 1 mergers may be in the planning stages.

Union Pacific is reported to be talking with Norfolk Southern about a merger while BNSF may be eyeing CSX. Spokespersons for the railroads declined to comment.

But Berkshire Hathaway Chairman and CEO Warren Buffett denied that BNSF is working with financial firm Goldman Sachs regarding a potential acquisition.

A UP-NS merger could create the largest railroad in North America.

Some on Wall Street believe that the Class 1s are engaging in trial balloon floating.

One firm said a merger of this magnitude would involve regulatory complexity and need broad stakeholder interest.

The trial balloons may be being used to gauge how government officials, investors, industry participants and others respond.

A Wall Street analyst told his clients that the reports about proposed mergers are likely to trigger a broad set of competing interests and that not all stakeholders will support the deals.

Any proposed mergers would require approval of the U.S. Surface Transportation Board and include a review process expected to take two years.

BNSF, NS Launch New Intermodal Service

April 3, 2025

BNSF and Norfolk Southern have launched a new collaborative effort to develop faster intermodal service between the Pacific Northwest and Chicago.

The service will be three days faster into the Windy City where trains will operate through to points in Ohio and Pennsylvania.

In a news release, railroad officials said they have developed a plan to build trains in less than two days dwell time off the dock with the density to seamlessly connect to and through Chicago.

Trains will be interchanged between BNSF and NS at the NS Ashland yard in Chicago and have a single crew swap before moving eastward. Total time from ship to Chicago will be six days.

Port Strike Affecting Class 1 Railroads

October 3, 2024

A strike of longshoremen at port from Maine to Texas has had some effects on Class 1 railroads.

Container volume has risen at West Coast ports which has resulted in more intermodal traffic for BNSF and Union Pacific. Both railroads have told regulators they are prepared for the additional traffic.

The strike is expected to affect Norfolk Southern and CSX, which serve many of the Eastern Ports affected by the strike.

Railroads had been preparing for the strike for weeks by implementing contingency plans that have included, for example, no longer accepting refrigerated equipment at CSX origins destined to East Coast ports. CSX also cut off import traffic that departs from ports destined to CSX terminals.

The strike by the International Longshoremen’s Association involves issues of wages, the use of automation in cargo handling, and working conditions.

The union also said in a statement that ocean lines based outside the U.S. refuse to share record profits with union employees.

STB Extends Class 1 Employment Reporting Rule

February 1, 2024

Four Class 1 railroads have been ordered by the U.S. Surface Transportation Board to continue reporting employment data through the end of the year.

The carriers were ordered in May 2022 to provide the information amid widespread service problems attributed to crew shortages.

The STB order affects BNSF, CSX, Norfolk Southern, and Union Pacific.

All four of those carriers have since increased their operating crew ranks but remain about 14,000 positions below pre-pandemic levels.

In extending the reporting rule, the STB noted that operating employment at the carriers has been essentially flat over the past six months.

The carriers report their employment data each month. The reports include data on hiring and retention plans. The reports also provide updates pertaining to labor force targets.

BNSF, NS, and UP were directed to continue to submit data about trainees in their monthly
employment data.

4 Class 1s Must Continue Reporting Service Data to STB

October 30, 2022

Four Class I railroads will continue to submit data about performance and employment to the U.S. Surface Transportation Board for another six months.

The regulatory authority last May ordered BNSF, CSX, Norfolk Southern and Union Pacific to submit service reports in the wake of freight service deficiencies that were the subject of STB hearings.

The railroads have since been giving updates pertaining to their performance and labor force targets, and any service recovery plan modifications.

The reports the railroads must submit are in addition to similar data they had already been providing to regulators.

The additional reporting called for the four carriers to further explain efforts to correct service deficiencies.

In its most recent order, the STB said the early reports “revealed extensive service delays and reliability problems.”

That included one carrier that failed more than half the time on average to deliver railcars in manifest service within 24 hours of the original estimated time of arrival.

Another carrier reported failing more than one-third of the time on average to deliver grain and ethanol unit trains within 24 hours of the original ETA.

In an order released Oct. 28, the STB said, “The most recent data show that the four carriers are currently meeting some of their six-month targets for service improvement, and many key performance indicators are trending in a positive direction.

“However, the data continue to validate the anecdotal information that continues to be reported to the Board regarding significant service issues. Key performance indicators, such as velocity, terminal dwell, first-mile/last-mile (FMLM) service (i.e., industry spot and pull), operating inventory, and trip plan compliance show that railroad operations remain challenged generally, and particularly when compared to pre-pandemic 2019 levels.”

The Oct. 28 STB order, though, said the four carriers will not be required to continue to participate in individual biweekly conference calls with the Board’s Office of Public Assistance, Governmental Affairs and Compliance.”

Rhetoric Continues to Rise in Contract Dispute

September 14, 2022

A ninth railroad labor union has reached a tentative agreement with the National Carriers Conference Committee, which represents railroad management in contract talks.

In the meantime, various shipper trade associations continued to apply pressure on Congress  to settle the dispute to avoid a strike or lockout that could occur as early as Friday.

President Joseph Biden also called top railroad management executives and union leaders to lobby them to settle the contract dispute, which a union president said on Monday is stalled over railroad attendance policies.

The latest union to reach a tentative agreement is the National Conference of Firemen & Oilers.

A news release from the union said the tentative pact implements the recommendations of a presidential emergency board of a 24 percent compounded wage increase over the five-year length of the contract, which covers the period of 2020 through 2024.

Workers would receive retroactive pay to cover 2020 and 2021 and parts of 2022. They also would receive five annual $1,000 lump sum payments.

That leaves three unions, which represent locomotive engineers, conductors and signal workers still at the bargaining table. The 12 railroad labor unions represent 125,000 workers.

The latest agreement came as various parties in the dispute continue to heat up the war of words.

Dennis Pierce, president of the Brotherhood of Locomotive Engineers & Trainmen, said on Monday that worker attendance policies are the primary unresolved issue in the contract talks.

Pierce said during an appearance on cable news network CNBC that BNSF and Union Pacific in particular are being adamant about refusing to modify their attendance policies.

“We’re just looking for time away from work to address our medical issues,” Pierce said.  “Union Pacific and BNSF attendance policies are assessing [penalty] points to our members when they just want to take time off for their regular medical appointments.”

In response, BNSF told CNBC that Pierce’s claims were false while UP said it was continuing to push for a “prompt resolution” to avoid a shutdown of the national freight rail system. 

In a related development, leaders of the SMART Transportation Division union told Congressional leaders on Tuesday that lawmakers should let rail labor contract negotiations play out.

In a letter to Congress SMART-TD legislative director Greg Hynes said union members would reject a tentative contract based on the recommendations of the PEB by a 3-to-1 margin.

Hynes also said in his letter that the top issue in the contract talks is not wages but working conditions.

He said the carriers “are still refusing to provide our members with minimal provisions to improve their overall quality of life, and to recognize their contributions to the industry and to the American economy.”

The PEB appointed by President Biden earlier this year was largely silent on work rules, saying  only that they should be negotiated at the local level between the railroads and the unions.

Unions have described the attendance policies that railroads have imposed as “draconian.”

“Through egregious and excessive absenteeism policies, the railroads have taken away our members’ ability to be a worthy parent and dependable spouse; and they have eliminated any realistic means for an employee to receive medical services or care for a sick child without being assessed discipline or termination,” Hynes wrote.

The PEB did recommend that workers receive one additional paid day off.

The Association of American Railroads said in a statement that workers have numerous ways to take time off, including paid vacation, sick leave and supplemental sick leave policies through the Railroad Unemployment Insurance Act.

The AAR statement said crews also can mark off for any reason “if they maintain a reasonable level of overall availability under carrier attendance policies.”

BNSF said its workers generally get three to five weeks of paid vacation and 10 to 14 paid holidays or personal leave days, and received a 25 percent increase in personal leave days.

UP officials said it “understands our employees want a different way and process … to request and receive time off for things like medical appointments. We are in active discussions with the unions to try to address these concerns.”

In the meantime, several trade organizations have called on Congress to intervene to head off a strike and/or lockout.

They include the National Industrial Transportation League, one of the largest and oldest group of rail shippers, and the U.S. Chamber of Commerce.

“NITL members and shippers of all sizes in all regions continue experiencing dismal freight rail service due primarily to the implementation of precision scheduled railroading. Any disruption in freight rail service will negatively impact our nation’s international competitiveness while making inflation even worse which is affecting all Americans,” Nancy O’Liddy, executive director of the NIT League, wrote in a Sept. 12 letter to congressional leaders.

The U.S. Chamber of Commerce said a strike would be an “economic disaster.”

On Monday, President Biden and members of his cabinet held emergency meetings in Washington and have been talking with the parties in the labor dispute.

The Federal Railroad Administration said it “is initiating oversight and enforcement efforts to ensure safety during any potential interruption of rail operations.”

STB Wants More Detail in Service Recovery Plans

June 15, 2022

Federal regulators have ordered four Class 1 railroads to submit more detailed plans to resolve freight service issues that have plagued the industry in the past year.

The order applies to Norfolk Southern, CSX, BNSF and Union Pacific.

In particular, the U.S. Transportation Board has ordered the carriers to correct what regulators see as deficiencies in the service recovery plans all four carriers submitted last month.

The board is also ordering the railroads to provide more information on their actions to improve service and communications with customers, as well as more detailed information on what they’re doing to hire more workers in order to provide more reliable rail service.

For example, STB members were dissatisfied with the plans submitted by NS and UP because they failed to include six-month targets for achieving performance goals.

“Unfortunately, these four carriers submitted plans that were perfunctory and lacked the level of detail that was mandated by the board’s order,” STB officials said in a statement. “The plans generally omitted important information needed to assure the board and rail industry stakeholders that the largest railroads are addressing their deficiencies and have a clear and measurable trajectory for doing so.”

The STB’s statement said the recovery plans need additional information which the STB order has laid out.

The service recovery plans were ordered on May 6 and came shortly after a two days of hearing in late April on shipper complaints of poor rail service.

The STB’s original order said the service recovery plans were to describe remedial initiatives and promote a clearer vantage point into operating conditions on the rail network.

STB Summons Class 1 CEOs to Talk Service Issues

April 8, 2022

The U.S. Surface Transportation Board will conduct public hearings on April 26-27 to discuss what it termed “urgent” service issues facing the nation’s freight rail network.

Regulators ordered high-ranking executives from BNSF, CSX, Norfolk Southern and Union Pacific to appear at the hearings.

Executives of Canadian Pacific, Canadian National and Kansas City Southern were also invited to address regulators.

Also expected to appear are representatives of other railroads, shippers, railroad labor unions, and other interested parties.

In a statement the STB said it has received numerous complaints in recent weeks from shippers and others about “inconsistent and unreliable” freight service.

The STB statement quoted STB Chair Martin Oberman as blaming the service issues on the precision scheduled railroading operating model, an obsessive desire to lower operating ratios and drastic workforce reductions.

“During my time on the Board, 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,” Oberman said. “Part of that strategy has involved cutting their workforce to the bare bones in order to reduce costs.”

Oberman’s statement noted that Class I railroads have collectively reduced their workforce by 29 percent or 45,000 employees.

The statement also said that such key performance metrics as terminal dwell time and average train speed have declined in the past few months.

For their part, the Class 1 railroads have attributed the service issues to crew shortages, which they say are rooted in difficulties they are having in retaining employees in a tight job market.

The railroads have said those issues are also affecting numerous other industries.

In his statement, Oberman said regulators will explore not just how the situation got to where it is but also what can be done to resolve it.

This will include exploring how regulators can use their authority to implement measures to address emergencies, increase transparency, and promote reliable service.

The hearings will be open to the public in person and through the STB’s website.

Those wishing to speak should notify the STB by April 14. Written testimony is optional but should be submitted by April 22.

Grain Shippers Complain About Poor Service

March 29, 2022

 A shippers group has written to the U.S. Surface Transportation Board to complain about poor service being offered to grain producers by three Class 1 railroads.

The letter was sent by the National Grain and Feed Association and said crew shortages related to the practice of precision scheduled railroading have led some of its members to shut down flour mills and feed mills.

“At rail origins, NGFA members are unable to purchase grain from farmers because they are full while awaiting loaded trains to be moved out by the railroad,” CEO Michael Seyfert said in the letter addressed to STB Chairman Martin Oberman.

In some cases, the letter said, livestock producers lack alternatives to rail-hauled grain shipments.

The letter contained numerous anecdotes of hardships faced by members of the trade association, including a member having to spend $3 million on alternative transportation to try to keep animals fed for a month.

The three railroads named in the letter were Norfolk Southern, BNSF and Union Pacific.

On NS, grain trains were said to have averaged 53.74 hours of delay at origin with an average of four trains held per day. There were 423 loaded grain hoppers and four empties that did not move for 48 hours or more.

In a statement, NS acknowledged having service issues but insisted it is making progress in alleviating them with a large class of conductors in training and offering hiring bonuses in areas where it has worker shortages during a tight labor market.

The letter can be read at https://www.stb.gov/wp-content/uploads/NGFA-Letter-to-STB-Chairman-Oberman-on-Rail-Service-and-Precision-Scheduled-Railroading-March-24-2022.pdf

Rail Unions Want Attendance Policies Probe

February 8, 2022

Two railroad labor unions are seeking a federal inquiry into the attendance policies of Class 1 railroads, Trains magazine reported on its website.

The action stems from a new policy being implemented by BNSF that unions say threatens safety because it could lead to workers having to be on the job when they are tired.

The Brotherhood of Locomotive Engineers and Trainmen, and the Transportation Division of SMART have threatened to strike over the work rule changes at BNSF but the carrier went to court in Texas to obtain an injunction against a strike.

The two unions are now taking their case to Labor Secretary Martin Walsh and Transportation Secretary Pete Buttigieg by seeking a federal review of the policies. 

The BNSF plan, known as Hi-Viz, assigns points to workers that they can be lose if they miss work for non-approved reasons.

Workers could be subjected to discipline or dismissal if they lose too many points over a given time period.

The unions contend the policy will force railroaders to accept job assignments even if they are tired.


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