Despite removing 900 locomotives and 60,000 freight cars from operation and cutting 2,300 workers this year, those numbers will continue to go up, the railroad’s new CEO Hunter Harrison said during an earnings call Wednesday.
CSX could lay off an additional 700 employees, according to the Jacksonville, Fla.-based Class I railroad’s new chief executive Hunter Harrison.
Harrison fielded tough questions at Wednesday’s Q2 2017 earnings conference call regarding the restructuring progress made in his first four months but said he’s pleased with the improvements so far.
CSX has removed 900 locomotives and 60,000 freight cars from service and laid off 2,300 people this year, and Harrison said those numbers will continue to go up.
“I wouldn’t be surprised, before the year is out, if some of these things come together, it could be 3,000 [workers],” Harrison said, in regards to the number of layoffs.
The company in March began the process of eliminating 1,000 management positions, most of them at the Jacksonville headquarters. The other 1,300 layoffs were distributed throughout the railroad’s network on the eastern seaboard.
Harrison also said that the company is planning to reduce the number of rail hubs in its network, currently at 12, to closer to three. “Could be two or four,” he said. As part of CSX’s restructuring plan, the company is working to eliminate infrastructure it doesn’t need and consolidate operations and eliminate redundancy.
However, Harrison was clear that the company is “not having a garage sale.” The demoted hubs will not be sold off; CSX will keep the land and railcars for “a time after Harrison,” when the company will hopefully see growth again, said the CEO.
CSX reiterated its forecast of 25 percent improvement in earnings per share this year. Nevertheless, the railroad’s stock fell 5.2 percent ($2.86) to $51.78 per share in afternoon trading after Wednesday’s Q2 announcement.
CSX may lay off another 700 employees
