Click the link to read the story.
Let's hope this isn't the beginning of the end of a great railroad.

It will be..if our do-nothing congress allows this to happen. These hedge funds are not bound by United States' laws, and their major stockholders are unknown.
They owning CSX is a recipe for disaster.

Ed

Then again, they MIGHT be on to something, if they are saying most of the CXS board consists of people who are not railroaders. Sometimes you DO have to think outside of the box. Then again, are some board members think of CSX as their own big "train set">

This could be a good thing. As I have read it in Trains magazine. These investment funds(the ones involved with CSX), invest for the long haul and really want the best for the company and shareholders. Then again what do I know.

I must need to read the "Trains" info on this. From what I've seen on TV, this TCI is a hedge fund that is out of Britain. I'm pressed to understand what they know about railroading. It seems to me, also from what I've read, that Mr Ward is doing a pretty good job of running CSX. Why else would any hedge fund want this rr?
Is it wise for a hedge fund, from another country, not bound by US regulations, and who's stockholders are unknown, to run an US railroad?

I've also been led to believe that TCI is upset with Mr Ward's capital investments in the railroad, because that leads to less bottom line..at the present.
At present, as you may know, the dispatching is to be decentralized, my haunt, the old B&O "west end" will come from the new dispatching center at Huntington.
Cumberland, from Baltimore. I assume the rest will still be Jacksonville.
They have spent a fortune on the West End. "Z" tower is going, to be replaced by remote operation from Huntington. New signals, switches, and remote equipment is installed and ready to go August 4th, when dispatching from Huntington begins. Near four million spent at the tower. Over the last two years, the heavy grades on the west end have been vastly upgraded, with new ties, rail and so forth to where the r-o-w is in the best shape I've ever seen it.
All or most of the leased power is gone, replaced by new low emission-fuel efficient units.
It's also been my understanding, again from TV, that TCI does not like this high capital investment, not enough bottom line, that investment is long range, and does not lead to dollars to shareholders right away.

My impression is that a hedge fund like TCI will deliver big bucks to shareholders..at the expense of the railroad..limit investment back in the "plant"..and run the thing into the ground.

But then again, what do I know. Just a poor old railfan, snapping photos of trains and getting along on a very limited budget..in other words, not a smart money manager!

Ed

Why is CSX dcentralizing Dispatching? IT was only a Decade Ago that they were touting their new High Tech Jacksonville Dispatching center. Did something go amuck?

I figure the folks that centralized dispatching aren't around much any more. And also, from the impression I've gotten from reading and listening, even here on the forum, CSX is not the only railroad changing dispatching. This is another reason I've been impressed with CSX at present. Seems to me somebody there is interested in "running a railroad", rather than operating a "plant".


I don't know if this is on topic, but in the new "Trains" magazine, there is an article about running double stacks. If one looks at the map of CSX to Cincinnati, you can see that the old route of the B&O, (that's not on the map) draws almost a direct line from Cumberland to Cincinnati through West Virginia and Ohio. Now, I don't know how much double stack would go to Cincinnati, (or for that matter other traffic) but it is almost 265 miles shorter than the present route.
Even the old "Patterson Creek Cutoff" could be re-opened..that saves some time in that trains bound for Cincinnati on the old route don't have to go thru Cumberland. Looks to me like dispatching from Huntington is a natural.

Ed

One issue with double stacks is vertical clearance -- not only with tunnels but with bridges as well. A recent thread about flood-caused detours made that point well. So even though a route may appear shorter, if it has many tunnels and bridges which need improved clearance it may be a long way from a viable option. Also, long with gentle grades is often preferred to short with steep grades.

Centralized dispatching was a disaster when it was first introduced and it never changed. DE-centralizing the CSX dispatching centers was one of the best moves CSX could have done. The division we run on, the ex-B&O from New Castle to Willard, OH is now dispatched out of Indianapolis.

The problem with centralized dispatching was that you had people dispatching railroad they had never seen. They had no idea where the grades were, where grade crossings were, whether a particular interchange siding was a facing or trailing point move - no depth of knowledge of the division they were dispatching. As long as everything ran smoothly, it worked - sort of. But let one little thing go wrong and the division would melt down in a matter of hours because everything stopped while the dispatcher figured out what to do.

As for the TCI board members, this is old news in the industry. This particular hedge fund does NOT have the long-term interests of the railroad as its goal. They are aggressive, quick-buck artists who want to extract as much cash as possible out of CSX before they move on. CSX has lagged behind the industry in capital spending on track maintenance for many years. They are just now catching up on maintenance to the point where the railroad is pretty decent again, and TCI wants them to stop spending that money? That's just nuts.

I hope CSX can fend off any more takeover attempts from this TCI outfit.

Amen Rich! While I'm not a enthusiastic supporter of government interfering in private enterprise, perhaps government financial assistance is required in the Railroad industry because of the very high capital expenditures necessary to maintain the infrastructure. They do it for highways, airports, seaports and, now financial institutions, why not more support for the only industry that can carry the materials needed for prosperity!
BTW, the name of my model railroad is Limited Government and Conservative Central RR

Dave G.

quote:

Originally posted by OGR Webmaster:
Centralized dispatching was a disaster when it was first introduced and it never changed. DE-centralizing the CSX dispatching centers was one of the best moves CSX could have done. The division we run on, the ex-B&O from New Castle to Willard, OH is now dispatched out of Indianapolis.

The problem with centralized dispatching was that you had people dispatching railroad they had never seen. They had no idea where the grades were, where grade crossings were, whether a particular interchange siding was a facing or trailing point move - no depth of knowledge of the division they were dispatching. As long as everything ran smoothly, it worked - sort of. But let one little thing go wrong and the division would melt down in a matter of hours because everything stopped while the dispatcher figured out what to do.

As for the TCI board members, this is old news in the industry. This particular hedge fund does NOT have the long-term interests of the railroad as its goal. They are aggressive, quick-buck artists who want to extract as much cash as possible out of CSX before they move on. CSX has lagged behind the industry in capital spending on track maintenance for many years. They are just now catching up on maintenance to the point where the railroad is pretty decent again, and TCI wants them to stop spending that money? That's just nuts.

I hope CSX can fend off any more takeover attempts from this TCI outfit.

TRUTH POST OF THE DECADE. Centralized dispatching was a BIG factor in many of the rash of collisions which occured on Class 1s a few years aqo. Hopefully the government can limit the power of activist shareholders. Jail time wouldn't be a bad idea. A felony conviction is just what a lot of these hot shot MBAs need and deserve.

quote:

I must need to read the "Trains" info on this. From what I've seen on TV, this TCI is a hedge fund that is out of Britain. I'm pressed to understand what they know about railroading. It seems to me, also from what I've read, that Mr Ward is doing a pretty good job of running CSX. Why else would any hedge fund want this rr?
Is it wise for a hedge fund, from another country, not bound by US regulations, and who's stockholders are unknown, to run an US railroad?

Ed I wish I still had the article. It was a couple of months ago at least.

I did read about TCI and their wish to take over CSX in some magazine or another, but I've learned more by watching Lou Dobbs, who also thinks the takeover of CSX is a bad idea.

Ed

One of the few cab rides I ever had was in ex-Southern E-8 6901, 12 years ago on the former New Georgia Tourist Railroad from Stone Mountain to Atlanta. It was at night, and all the block signals on the way were red. I asked what this was about, and the nervous engineer said there was a computer problem in Jacksonville. He proceeded very carefully through the signals and switches in busy Cabbagetown yards on the way to Zero Milepost in Atlanta. He made it without incident, but it was very interesting. After experiencing the tension, I don't think I would want to be an engineer.

And JAX also happens to be in the middle of a hurricane zone. Suppose Katrina would have made a direct hit....all of CSX dispatching would be lost. What about an F5 tornado at eh UP Harriman Dispatch Center?

Concepts like the Spring TX dispatch centers are good.

I know of an UP conductor who came from SP. He was required to do a ride out on the territory he ran every so often. Rode in the cab of the SUNSET LTD a lot. That should be required.

One other thing. When it comes to "stock value", don't they forget about the customer? If you really give the customer a flaming bladder, he or she is not going to buy or reduce buying your product. And what happens to your stock? DOWN!

quote:

Originally posted by Ed Mullan:
It will be..if our do-nothing congress allows this to happen. These hedge funds are not bound by United States' laws, and their major stockholders are unknown.
They owning CSX is a recipe for disaster.

Ed

Why would they not be bound by US laws if they are doing business in the US?

quote:

Originally posted by DominicMazoch:
And JAX also happens to be in the middle of a hurricane zone. Suppose Katrina would have made a direct hit....all of CSX dispatching would be lost. What about an F5 tornado at eh UP Harriman Dispatch Center?

Concepts like the Spring TX dispatch centers are good.

I know of an UP conductor who came from SP. He was required to do a ride out on the territory he ran every so often. Rode in the cab of the SUNSET LTD a lot. That should be required.

One of my co-worker's Father just retired from CSX's Jacksonville, FL dispatch center. He seemed to think that the major factor was the vulnerability of having all of the system knocked out if a hurricane or other disaster affected the Jacksonville location.

My employer, an airline, actually has a secondary central operations center for this same reason. Hurricanes are also a factor for my employer's headquarters. They have random drills where operations are moved to the secondary location.

I was caught up in that centralizing of operations in Jacksonville.....
I worked in the Chessie Operations Center at Baltimore and our department was
the first to make the move to JAX on September 1, 1986.........

The Dispatchers gradually came next from all over the Chessie & Seaboard
Coast Line. I believe there were 725 dispatcher positions reduced to a little
over 500.........
I never thought it was a good move, however I just worked there..........
I believe others involved thought the same thing but
Merging the 2 systems had to show savings and IBM Computers amoung others
allways convince management that new computers can make the savings and be
workable........

Now 22 years later those decisions are being reversed (for the better) and
are moving closer to the territory they dispatch.
Smaller offices are more manageable with less confusion........

With the few shares of CSX that I have, I voted for the present management.
The operations looked good to me.......

With the outcome of the proxy fight being so close, it appears many share
holders do not agree with me...........

Interesting replies. Back to the root of the issue,ie. whether non-railroad men such as hedge fund analysts and managers will improve operation of the target or simply sell off assets to maximize their $ returns to THEIR few partners at the expense of the CSX Shareholders. I think not. From reading similar experience with non-railroaders, example John Snowjob, who took a lot of money but failed to improve railroad performance. The recent change of management at FEC is another example which is comfusing. They were featured in Trains Mag a few months ago, seemingly a much improved railroad, then fired the president. Lionel was another example of hedge fund mismanagement. How many CEO's in the past 15 years?? Hopefully Gerry, with the incentive of a potential significant ownership position will be sucessful.

quote:

Why would they not be bound by US laws if they are doing business in the US?

A very good question..your Congressional Representative has the answer!

Get a GRIP...Get Rid of Incumbent Politicians.


Ed

quote:

Originally posted by OGR Webmaster:
...This particular hedge fund does NOT have the long-term interests of the railroad as its goal. They are aggressive, quick-buck artists who want to extract as much cash as possible out of CSX before they move on...

And this makes them different or less dangerous than directors, CEO's, day-traders, analysts, etc., how?

While I agree TCI would do more harm than good to CSX, a good portion of the blame lies with CSX leadership and their typical corporate thinking of putting shareholder happiness first, company health second. Any first-year finance student with an ounce of common sense knows the company's health AND shareholder happiness go hand-in-hand for the good of all concerned. Unfortunately, the "what's in it for me" and/or "how much money can I milk the company for in dividends, director compensation, perks, etc." mentalities take hold in later years and while it helps line the pockets of a few, it also opens the door for movements against the company similar to what TCI is doing.

TCI would not be in the best interests of the company AND shareholders, but it looks like any counter-action now may be an exercise in futility. I really hope I am proven wrong.

At sixty I have stayed on working for a while longer to see what the future brings for my department. As to who "owns" us I can say from a worker standpoint it does not mater in the least. Seeing the New Haven and NYC go on to be merged into the PC followed by Conrail and Amtrak most of us saw no radical change to our jobs. Than having CSX and NS get to pick us over again saw no major change. I still work with the people I new 30 years ago more or less as I moved around a lot back than. To Guys like me it is the same old deal with different color stickers on the trucks...