Berkshire Hathaway-owned BNSF Railway Co. eliminated 62 management jobs last week and restructured its operations organization from three regions to two, effective today, according to a statement from the company.
Berkshire Hathaway-owned BNSF Railway Co. eliminated 62 management jobs last week and restructured its operations organization from three regions to two, effective today, according to a statement from the company.
BNSF said the realignment stemmed primarily from massive declines in coal volumes and service improvements resulting from “significant capital expenditures.”
Previously the railroad sector’s largest commodity by volume, coal volumes have fallen sharply amid new Environmental Protection Agency regulations requiring power plants to burn it more cleanly and a drop in the price of natural gas.
The Association of American Railroads last month reported April coal volumes on United States railways were down 39.7 percent compared with the same 2015 period.
As a result of the capital expenditures, “BNSF’s rail network is now in the best shape it has ever been, generating consistently strong service levels,” BNSF spokesman Michael Trevino said. “These service improvements, along with productivity measures, mean the company is operating safer, more efficiently and better, utilizing its equipment and resources.”
“At the same time, we are seeing a fundamental, structural shift in the coal industry, with double-digit volume declines in the first quarter of 2016 alone and no expectation for a return to previous levels,” he added.
“Realigning the Operations organization responds to the changing business environment and helps us better align resources with our customers’ demand for freight service. This realignment of Operations will create a leaner and more agile organization that is better positioned for growth and new business opportunities.”
BNSF has been cutting staff amid depressed demand for transportation of coal, as well as crude oil, which caused company profits to fall 25 percent to $784 million in the first quarter of 2016, the lowest level in two years.
BNSF slashes management positions in operational realignment
