Notebook MARS: meet the new boss
LOMBARD, Ill. – Notes from Wednesday’s Class I CEO appearances at the Midwest Association of Rail Shippers Winter Meeting:
Meet the new boss
New Norfolk Southern President Alan Shaw displayed a nice touch of self-deprecating humor in his Wednesday luncheon speech to MARS and the Traffic Club of Chicago, as evidenced by his description of his first interaction with members. of the NS crew after his promotion.
“It was important for me to be on the pitch that first day,” he said. “So I was in Toledo, because it’s our biggest crew change point on our system, and it’s a very important corridor for us during the high season… I wanted to thank [employees] for their dedication to Norfolk Southern and our customers, and wanted to hear their feedback on how we are fixing service and how we continue to improve our productivity. …
“It was like 30 minutes after the announcement. And I see crew members sitting outside the crew change room, and I walk up to them…they’re looking at a guy that they don’t recognize, and I’m wearing khahis and boots, and a collared shirt. Not necessarily a nice shirt. And they’re like, ‘Oh, great, here’s an operations supervisor.’
“So I come up and introduce myself. They told me their names, and one of the guys said, ‘Well, what are you doing?’ I said, “Well, I’m the president”. And he looks at me, and I’m like, “Not Joe Biden’s president, but Norfolk Southern’s president.” And the other guy pulls out his phone, and he’s like, ‘Oh, yeah, yeah, yeah, I saw the ad. Congratulations!’
“So that made me feel good. And then the guy looks at me and says, ‘What job are you from? … Were you a mechanic, or an engineer, or a conductor, or an engineer?’
“And I was like, ‘No, I started in finance.’ He really wasn’t impressed with that. He said, ‘Man, at some point we’ll have a tradesman running the railroad.’…
“It’s a little humiliating when you go out there and talk to them, because they have their own expectations.”
Shaw also shared what he said was his first conversion with the Nova Scotia Board of Directors following his election as president and as the next CEO of the railroad. He will assume this position in May, when Jim Squires retires.
“Their main message to me was, ‘Don’t mess up,'” he said. “Now it was a little more powerful than that. I’ll let you use your imagination to figure out what the real verb they used was.
“We have good momentum, and I have to keep up that momentum.”
Changes for the CP in Bensenville
During his joint appearance with KCS CEO Patrick Ottensmeyer, Canadian Pacific’s Keith Creel said big changes are happening at CP’s Bensenville Yard in Franklin Park, Illinois, thanks to the 2020 settlement of a dispute with the Illinois Tollway about the agency’s plan to build a toll. road to reach the west side of O’Hare International Airport [see “CP, UP, and Illinois Tollway reach agreement …,” Trains News Wire, May 21, 2020].
Bensenville was converted from a bump court to a flat switch in 2012, Creel noted. “There’s a big footprint there, but it’s not optimized. We did not spend huge sums of money to reconfigure the yard. Part of the problem was a Union Pacific line that ran through the middle of the yard; for the most part, this route crossed CP property on a berm that pinched the shape of the facility into an hourglass. “Everything on the west side is a storage yard,” Creel said. “It can store cars, but it’s not hugely helpful when it comes to dealing with cars. And that limits our usefulness in optimizing that terrain.
That’s about to change. As part of the agreement between the two railroads and the toll highway, along with the related acquisition of land that included industrial properties, the UP line will be placed on a bridge, parallel to the highway bridge toll and eliminating the physical barrier between the two halves of the court.
“It unlocks all that land that had buildings on it. So, effectively, we’re going to…almost double our footprint in Bensenville,” Creel said. The railroad will use the reclaimed land and spend about $300 million to build a “state-of-the-art” switching facility, he said, as well as an intermodal terminal and automobile facility. The latter has particular advantages given its location next to O’Hare Airport. “This airport is the number one consumer of rental vehicles in North America,” Creel said. “So if you are a [manufacturer], and you need somewhere to land those finished vehicles, it offers a pretty compelling value proposition.
The CP-Amtrak Agreement
Creel said CP was “proud” to have reached its agreement with Amtrak to allow the prospect of additional passenger service on the merged CP-KCS routes, which led Amtrak to offer official support for the merger. . [see “Amtrak backs CP-KCS merger …,” News Wire, Jan. 6, 2022].
Creel said he is well aware, after 30 years as an operating officer, that it is not easy for a freight railroad to coexist with passenger service.
“I sometimes understand the conflicts and trade-offs sometimes when you mix high-speed passenger rail with what is, in comparative terms, low-speed freight rail,” he said. “I understand the challenges of track geometry, I understand the challenges of speed… But I also understand that if you prioritize correctly, and there are compromises and balance in a partnership, you can be successful. And that’s the approach we’ve taken at CP.
“Five years ago, six years ago, we weren’t leading the Amtrak service industry. We’ve had it for five years. And that same spirit of partnership, trust and respect that we built by accomplishing that allowed us to enter into an agreement with Amtrak.
Creel said the possibility of including KCS lines in this deal – after KCS previously did not welcome Amtrak overtures – reflects the fact that “a lot has changed today that allow us to do what we did with Amtrak that Tap [Ottensmeyer] never had the advantage of kissing. Among them: funding for Amtrak in the recently passed infrastructure bill.
“These billions of dollars in infrastructure support that the White House has given Amtrak to invest in networks to grow the service, that’s history,” Creel said. “But without the relationship we’ve enjoyed and the trust we’ve built…this wouldn’t have been possible.”