CSX Corporation 2

8/19/2019 CSX Corporation 2

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School of BusinessFaculty of Business and Applied Arts

ACADEMIC TASK No. 1

Assignment

Topic: - CSX Corporation

Submitted by:-Mayank Tripathi

Registration no.:-11201969

Roll no.:-A-12

Section: - Q1202Course Code: MKT501

Course Title: Marketing Management



CSX Corporation

CSX Corporation is an American company targeted on real estate and railways in North America, among alternative industries. the corporate was fashioned in 1980 by the merger of Chessie System and seaside Coast Line Industries andeventually incorporate the varied railroads closely-held by those predecessorsinto one line that became referred to as CSX Transportation.

CSX was incorporated in 1978 below Virginia law. In 1980, thecorporate completed the merger of the Chessie System (“Chessie”)and seaboard Coast Line Industries (“Seaboard”) into CSX. The merger

allowed the corporate to attach northern population centers and Appalachian coalfields to growing southeastern markets. Later, the Company’s acquisition of

key parts of Conrail, Inc. allowed CSXT to link the northeast, as well as NewEngland and also the New York metropolitan area, with Chicagoand western markets also because the growing areas within the southeast alreadyserved by CSXT. This current rail network permits the corporate to directlyserve each major market within the eastern united states with safe, dependable,environmentally accountable and fuel economical freight transportation andintermodal service.

CSX Corporation presently contains a variety of subsidiaries on the far side CSXTransportation, as well as Fruit Growers express, CSX Technology,CSX DE Mexico, and CSX real property among others. Primarily based in Richmond, Virginia, USA after the merger, in 2003 the CSX Corporationheadquarters stirred to Jacksonville, Florida.

In 2014, CSX reported incomparable records for revenue that grew five percent to$12.7billion, operational financial gain that rose four percent to $3.6 billion, net earnings, that enhanced three percent to $1.9 billion, and earnings per

share that conjointly ratcheted up three percent to $1.92 compared with 2013results. Volume climbed six percent to 6.9 million units and operational expensesrose six percent to $9 billion.

https://en.wikipedia.org/wiki/CSX_Corporation

https://en.wikipedia.org/wiki/CSX_Corporation



1. Rail

CSX Transportation, Inc.CSX’s principal in operation subsidiary, CSX Transportation, Inc. (“CSXT”), provides a vital link to the transportation offer chain through its just about twentyone thousand route mile rail network that serves major population centersin twenty three states east of the Mississippi, the District of Columbia and alsothe Canadian provinces of Ontario and Quebec. It servesover seventy ocean, watercourse and lake ports on the Atlantic and Gulf Coasts,the Mississippi River, the great Lakes and also the St. Lawrence Seaway.CSXT additionally serves thousands of production and distribution facilitiesthrough track connections to just about Two hundred forty short-line and regionalrailroads. Carloads total regarding four million annually, with commodities startingfrom coal, biodiesel and ethanol, to automobiles, chemicals, military equipment,forest merchandise and client merchandise. The company's wheeledvehicle includes a fleet of quite four thousand locomotives and eighty thousand railcars, and rail network includes thirty six yards located in sixteen states.

CSXT’s operations are primarily targeted on four major transportation networks

and corridors that are outlined geographically:-

Coal Network- The CSXT coal network connects the coal mining

operations within the Appalachian mountain region with industrial areas within

the Northeast and middle Atlantic, also as several watercourse, lake, and deep

water port facilities. CSXT’s coal network is well positioned to provide utility

markets in each the Northeast and Southeast and to move coal shipments for

exports outside of the U.S. Roughly three of each four tons of domestic coal

and virtually half the export coal that the corporate transports is employed for

generating electricity.

Interstate 90 (I-90) Corridor - This CSXT passageway links Chicago and alsothe Middle West to metropolitan areas in New York and New England. Thisroute, additionally referred to as the “water level route,” has minimal hills andgrades and nearly all of its 2 main tracks (referred to as double track). These



superior engineering attributes allow the passageway to support consistent, high-speed intermodal, automotive and merchandise service. This passageway may bea primary route for import traffic returning from the Far East through western portsmoving eastward across the country, through Chicago and into the populationcenters within the Northeast. The I-90 passageway is additionally a vital link between ports in New York, New Jersey, and Pennsylvania and consumptionmarkets within the Middle West. This route carries goods from all 3 of theCompany’s major markets – merchandise, coal and intermodal.

Interstate 95 (I-95) Corridor- The CSXT I-95 corridor connectsCharleston, Jacksonville, Miami and plenty of different cities throughout theSoutheast with the heavily inhabited northeastern citiesof Baltimore, Philadelphia and New York. CSXT primarily transports foodand client merchandise, additionally as metals and chemicals on this line. It’s the

sole rail passageway on the eastern seaboard south of Washington, D.C., and provides access to major eastern ports.

Southeastern Corridor- This vital a part of the network runs between CSXT’s western gateways of Chicago, St. Louis and Memphis through the citiesof Nashville, Birmingham, and Atlanta and markets within the Southeast. TheSoutheastern passageway is that the premier rail route connecting these key cities,gateways, and markets and positions CSXT to with efficiency handle projectedtraffic volumes of intermodal, automotive and general merchandise traffic.The passageway additionally provides direct rail service between the coal reservesof the southern Illinois basin and therefore the increasing demand for coal withinthe Southeast.

ORPORATION CSX CORPORATION

CSX CORPORATION



2. Industrial

LocomotivesCSXT operates over four thousand locomotives; of that over ninetyfifth are closely-held by CSXT. Freight locomotives are the ability supply used primarily to drag trains. Change locomotives are employed in yards to type railwaycars so the proper railcar is hooked up to the proper train so as to deliver it to itsfinal destination. Auxiliary units are usually accustomed give further traction forserious trains in rough terrain.

EquipmentsThe Company’s equipment consists of freight cars, containers and chassis.

Gondolas- Support CSXT’s metals markets and supply transport for woodchipsand different bulk commodities. Some gondolas are equipped with special hoodsfor protecting merchandise like coil and sheet steel. .

Open-top hoppers- Transport heavy dry bulk commodities such as coal, coke,stone, sand, ores and gravel that are resistant to weather conditions.

Box cars- Include a spread of tonnages, sizes, door configurations and heights toaccommodate a large vary of finished merchandise, together with paper, auto parts,appliances and building materials. Insulated box cars deliver food merchandise,canned goods, beer and wine.

Covered hoppers- Have a permanent roof and are segregated centered uponCommodity density. Lighter bulk commodities reminiscent of grain, fertilizer,flour, salt, sugar, clay and lime are shipped in colossal automobiles referred to as jumbo blanketed hoppers.Heavier commodities like cement, ground limestone and glass sand are shipped insmall cube included hoppers.



Multi-level flat cars- Transport finished automobiles and are differentiated by the Number of levels: bi-levels for large vehicles such as pickup trucks and SUVs andtri-levels for sedans and smaller automobiles.

Flat cars- Used for shipping intermodal containers and trailers or bulk andfinished goods, such as lumber, pipe, plywood, drywall and pulpwood.

Containers- Weather-proof packing containers used for bulk cargo of freight.

Chassis- Wheeled help framework for a container that makes it possible for it to beconnected to a tractor. All the company’s chassis are leased.

The manufacturer also has different varieties of equipment similar to lift apparatusand double stack railcars, which permit for two containers to be, mounted one

above the opposite.

AutomotiveCSX’s automotive business generated 435,000 carloads in 2014 for revenue of$1.2 billion – matching the 2013 revenue base. CSX maintained performance by conjugation a rise in lightweight vehicle production whereas facingchallenges because of weather. CSX serves automotive producing plants andassembly centers in eight states and provides a network of foremost vehicledistribution centers with fashionable inventory and facility management

technology. It conjointly serves major vehicle port process locations that are integral to the finished vehicle supply chain. CSXhas robust relationships with ancient domestic makers General Motors, Ford, andChrysler, as well as “New Domestics” Honda, Nissan, Toyota, Kia, Hyundai,

Volkswagen, Subaru, Mercedes, and BMW.Strong growth was driven by a rise in North American lightweight vehicle production in response to raised demand within the rising economy.

ChemicalsGrowth occurred across most markets reflective improvement in demand forintermediate merchandise utilizedin producing vehicles and commodity. Several plastics and chemicals are keyinputs within the production of each sturdy and unserviceable product, still as packaging.CSX touched a complete of 620,000 carloads of chemicals and fossilfuel commodities in 2014 for revenue of $2.18 billion – a 15 % increase over 2013.



dimensional product as well as farm andconstruction equipment.



3. Agricultural

Agricultural ProductsVolume grew with raised shipments of feed grains and ethanol. Shipments of feedgrains improved with expanded meat production and lower wheatimports. Ethanol shipments grew because the quantity of ethanol infuel continuing to extend. CSX captive a complete of 419,000 carloads ofagricultural merchandise in 2014 for revenue of $1.1 billion – a 12 % increasefrom 2013. Volume will increase were driven by gains within the grain andethanol markets. The majority of CSX’s agricultural traffic is domestic shipmentsthat work into 2 distinct markets: whole grain merchandise, that include corn,soybeans; and wheat and processed grains that consists of feed ingredients, flour,

edible oils, corn sweeteners, and ethanol.

Phosphates and FertilizersVolume multiplied as a result of strength in demand for domesticfertilizers attributable to a powerful planting season and because of refilling of lowinventories. In 2014, CSX’s phosphate and fertilizer business affected 330,000carloads for revenue of $534 million – a 1 % increase over 2013.A late planting season brought domestic shipments higher than traditional wellinto June, and that they remained sturdy through the third quarter. Overall, rock

revenue was up for the year, and robust revenue improvement was seenin Nitrogen fertilizers and export Phosphate. Within the fourth quarter, somedomestic Phosphate demand went unsuccessful as a powerful grainharvest place significant demand on the lined hopper fleet utilized by eachcommodity. Additionally, low natural gas costs within the U.Shave resulted during a revitalization of interest in domestic Nitrogen production.CSX conjointly services 2 Deepwater Nitrogen answer import terminals,has wonderful connections to the western gateways to servicethe potash originating in American state and Utah, and has access to Eighteen Eastand Gulf Coast ports.

Food and ConsumerVolume raised slightly as strength in refrigerated product, primarily fruits andvegetables, and alcoholic beverages were part offset by weakness in demand forappliances.CSX’s food and customer business moved a complete of ninety fourthousand carloads in 2014 for revenue of $265 million – a 1 % decrease from



2013. Volume declined because of a discount in shipments altogether markets withthe exception of alcoholic beverages, that knowledgeable a robust performance asa result of raised volume with one of CSX’s customers. Severe winter weathercaused longer automotive cycle times that evidenced to be a challenge throughoutthe year for food shipments which require prompt and timely service.Fifty percent of CSX’s food and shopper market are dry grocery merchandisethat embraces alcoholic and non-alcoholic beverages, canned foods, anddry foodstuff. Quite 30 % of shipments temperature controlled product, togetherwith fruit crush and manufacture. Shopper product, together with factory-made merchandise and appliances, structure the balance. The reach of the CSXnetwork, together with strategic partnershipswith different transportation suppliers, edges customers by making direct linesto process plants that manufacturefood and potable product, appliances, and different shopper product.

As shopper demand continues to extend, CSX is poised to produce premiumservice for food product and beverages. Meanwhile, the CSX facilitatedfood network can still expand into the Southeast and also the company can expandto service further key growth regions for foodstuff demand. Overall, CSX’s foodand customer business is poised for long-term growth.



4. Housing and Construction

Emerging Markets

Shipments increased in limestone, transportation equipment and aggregates (whichinclude crushed stone, sand and gravel) as a result of overall market growth due tothe improving economy.

Forest ProductsVolume raised with strength in shipments of pulp board and paper utilizedin packaging for customer product. Volume conjointly raised slightly inconstruction-related markets. CSX moved a complete of 307,000 carloads for theforest merchandise market in 2014, generating revenue of $819 million – a6% increase over 2013 results. Continual improvement within the housing andassociated markets bolstered each revenue and volume growth for theforest product market throughout 2014. CSX plays a vital role within the entire North American Forest product trade, serving 2 distinct market segments: paper product and building product. Whereas the continuing growth of electronicmedia has dampened demand for printing paper and newsprint, demand for packaging paper was robust, wood pulp remained stable, and forest product stay anintegral a part of CSX’s portfolio.



5. Coal

Volume was basically flat as increased export shipments were offset by weaknessin utility shipments. Higher export shipments were due to greater demand for U.S.metallurgical coal in Asia and steam coal in Europe. Shipments to utility customerswere down as high utility stockpiles were reduced throughout the year and areapproaching targeted levels. The increase in revenue per unit was driven byimproved yield, higher fuel recovery and longer length of haul. Total coal volumeis expected to increase as the Company expects to ship approximately 35 – 40million tons of export coal and projects increases in utility coal volume in 2011.CSX’s coal business moved 1.3 million carloads in 2014 for revenue of $2.8 billion – a two percent decrease from 2013. The CSX network runs through theheart of the Appalachian coal fields, and also serves the growing Illinois Basin coal

fields and major interline connections to railroads originating western coal. CSXmoves coal shipments to major export terminals in Newport News, Virginia;Baltimore, Maryland; and Mobile, Alabama. It also serves two coal terminalson the Great Lakes and several terminals along the inland river system.Utility coal volume increased in 2014 as a result of a cold winter and a rise innatural gas prices from the previous year. Increased coal use rapidly drew downexisting inventories, requiring stockpile replenishment to return inventories in thenorth to more normalized levels. Southern inventories remain above normal.Export volume was down 12 percent from2013, due to over-supply in the globalmarket.



6. Intermodal

Global and home shipment growth resulted from U.S. Inventory replenishment,elevated U.S. Exports, new business, truckload conversions, and new UMAX anddoor-to-door provider choices. The revenue-per-unit decline was once driven bymeans of the have an effect on of switching from a purchased transportationassociation to a home interline application at the begin of 2nd quarter. Thisapplication, referred to as UMAX, supplies consumers with containers for nearbyshipments or transcontinental provider offered jointly with the aid of CSX andUnion Pacific Company. This income-per-unit decline was once partly offset viaexpanded gas recuperation and an increased pricing atmosphere.CSX’s intermodal business delivered 2.7 million units in 2014 for sales of $1.8 billion – a 5 percent develop over 2013.CSX instantly serves fifty three intermodal

terminals, the switch aspects between rail and trucks, on its intermodal communityin 19 states and within the Canadian province of Quebec. Intermodal supplies keyadvantages to shippers looking to optimize give chains through scalable potential,sustainable savings, and community flexibility. In home markets, drivers includedfreeway-to-rail conversions, elevated demand from new and existing customers,service product enhancements, and improved access into smaller markets throughCSX’s mixed hub-and-spoke and hall community method. Global intermodalvolume development was once pushed via a getting better economic climate and anexpand in international container shipments relocating to inland destinations. CSXand executive partners are investing in infrastructure to develop ability on themanufacturer’s rail community, which presents great public advantages, including

job production, expanded business at U.S. Ports, lowered freeway congestion, andreduce emissions. The national Gateway is an $850 million public-exclusive partnership that increases intermodal potential by means of clearing key routes between Mid-Atlantic ports and the Midwest for double-stack intermodal trains. Toadditional prolong intermodal solutions, two new intermodal terminals opened in2014 in Sala berry-de-Valleyfield, Quebec, and in winter Haven, Florida with theaid of public partners.



Comparison With Competitors

And Pricing StrategiesCSX competes inside the broader transportation offerings marketplace. Theenterprise competes immediately with truck, barge and different rail transportation providers. Although transportation modes and detailed vendors are in directcompetitors, they most commonly work cooperatively to offer services thatcombine modes. For illustration, railroads work with truckload carriers to offerdoor-to-door container and trailer offerings to shippers.The business atmosphere wherein the manufacturer operates is extremelycompetitive.Shippers probably prefer transportation vendors that offer the most compellingmixture of service and price. Carrier requirements, each in phrases of transit timeand reliability, fluctuate by using shipper and commodity. Hence, the corporation’s

fundamental competition varies by way of commodity, geographic place and modeof to be had transportation. CSXT’s most important rail competitor is NorfolkSouthern Railway, which operates in the course of so much of the company’s

territory. Different railroads also operate in ingredients of the company’s territory.Relying on the targeted market, competing railroads and deregulated motor carrierscould exert strain on rate and service phases.

Top Competitors for CSX Corporation:

Norfolk Southern Corporation

UNION PACIFIC CORPORATION

Amongst these three, Union Pacific is the dominant franchise. Every of the primary railroads stories its operations relatively in a different way. NorfolkSouthern lumps more than one class of shipments beneath the heading "generalmerchandise", at the same time CSX and Union Pacific are extra precise aboutchemical compounds, industrial merchandise, car, and extra industries.One among Union Pacific's primary accomplishments within the last a couple ofyears has been the corporation's capacity to deal with depressed coal prices. Lastquarter was no exceptional with Union Pacific as the only one of the crucial large

three railroads to record constructive sales development in coal shipments. WithCSX and Norfolk Southern reporting coal revenues down 7 % and 9%respectively, reporting growth in coal revenues is an excellent feat by UnionPacific. It should come as no shock that Union Pacific's superior performance inthe susceptible coal segment also allowed the railroad to report an operatingmargin larger than either of its competitors as well. All matters being equal, acompany with a bigger running margin is more insulated from pricing challenges



and weaker demand. With an running margin of over 35%, Union Pacific is notonly outperforming the competitors, it can be crushing them. Each CSX and Norfolk Southern suggested margins of 30% or much less. This won't sound like atremendous change, but with Union Pacific posting over $5 billion in income eachquarter, this 3% better working margin method hundreds of thousands extra ingains.Union Pacific's better coal performance and a better operating margin are twoforemost motives within the enterprise's better money waft. Many investors usemoney flow growth as a key factor in figuring out what stocks to purchase. For thereason that gains can be manipulated, money drift is a extra pure measure of what acorporation can return to shareholders.CSX company may have been tough-hit by using the railroad industry'sdisappointing fourth quarter, nevertheless it's faring a long way better than primarycompetitor Norfolk Southern which announced it will reduce 2,000 jobs and

downsize 1,500 miles of its rail strains following a essential this fall hit, whenearnings dropped a whopping 29 percentage. Now, the manufacturer has plans to cut expenses by means of more than $650million annually by 2020, shaving jobs, advantages and fuel bills, consistent with aorganization statement. The company will start by means of slicing $130 million in2016. Now, the corporation has plans to reduce expenditures by greater than $650million yearly by way of 2020, shaving jobs, advantages and gasoline expenses, inline with a manufacturer statement. The company will start via chopping $onehundred thirty million in 2016.The railroad plans to lower overall headcount via 6.7 percent, specializing in theseareas which were most plagued by the dwindling coal quantity. NSC additionally plans to cut its time beyond regulation to 1/2 its stage the prior year.Operating areas will consolidate from three to 2, and 1,000 rail traces will probably be downgraded in 2016, with visitors rerouted to better-density traces. With thechanges, the manufacturer plans to have an working ratio under 70 percent in 2016.



Promotion

The United States Surface Transportation Board (STB) authorised the CSXacquisition of an working easement referred to as the Elsdon Subdivision from theGrand Trunk Western Railroad. In particular, greater than 22 miles of track fromMunster, Ind., into Chicago’s Southern Suburbs (Lansing, South Holland, Phoenix,Dixmoor, Harvey, Blue Island, Evergreen Park) as well as due north into Chicago.This enables CSX to function non-stop on the Elsdon Subdivision as much as fortymph, to higher serve our patrons, to measurably curb coach idling time, and insome cases, to reroute traffic away from extra congested routes in Dolton,Riverdale, Chicago, Alsip, Chicago Ridge, o.K.Garden, and Bridgeview to

portions of the Elsdon Subdivision.In addition, CSX will operate up to eight to 23 trains per day over varioussegments of the Elsdon Subdivision. Multiplied coach operations on the Elsdonline is required in anticipation of balancing future regional economic progress.These trains will exceptionally run at off top instances. These changes in freightsite visitors will be offered progressively in late 2013 or early 2014.CSX, the Delaware division of Transportation and Operation Lifesaver, a

countrywide non-revenue educational institution, are working together to enhance public safeguard at railroad crossings and round railroad tracks in Delaware bymeans of education and realization.

NASCAR sprint Cup sequence rookie Chris Buescher will promote railroadsecurity with CSX in 2016, with the transportation enterprise returning its “Play Ittrustworthy” messaging to the front Row Motorsports No. 34 Ford Fusion for a

fourth consecutive season.CSX, a Jacksonville, Fla.-founded railroad, has partnered with front RowMotorsports for the previous three sprint Cup sequence seasons to unfold themessage to “Play It safe” around railroad tracks and to “Brake for Trains.” As oneof the vital nation’s leading transportation suppliers, with a community masking

21,000 miles of railroad tracks in 23 states, CSX is committed to teaching the

public on railroad safety within the communities it serves.



References

https://www.csx.com/

http://www.hoovers.com/companyinformation/cs/competition.CSX_Corporation.b2e0dd45a692a797.html

http://www.teamfrm.com/34-team-news/csx-extends-with-frm-to- promote-safety-in-2016

https://toledobiz.com/Files/major_stories/tbj_featured1407csx_noit.html

http://www.wikinvest.com/stock/CSX_(CSX)/Competition#toc

http://www.bizjournals.com/jacksonville/news/2016/01/28/major-cuts-for-main-csx-competitor.html

http://www.fool.com/investing/general/2013/10/25/union-pacific-rolling-along-and-crushing-the-compe.aspx

http://www.mbaskool.com/brandguide/transport-and-logistics/4469-csx-transportation.html

CSX2014_CSR_Report

CSXPublicPolicyManual_8.10.12_CSX_Public_Project_8.5x11

2010 CSX Annual report CSXT_Interim_Guidelines_for_HDD_Projects_V3a

http://www.sec.gov/Archives/edgar/data/277948/00002779481300000

8/csx-12282012x10k.htm http://www.valueinvestorsclub.com/idea/CSX_CORP/64662 http://search.lycos.in/web/?keyvol=00cffdf15e235f65e82c&q=%22C

SX%20Corporation%22

http://america.pink/csx-corporation_816849.html

http://www.sec.gov/Archives/edgar/data/277948/000027794813000008/csx-12282012x10k.htm




http://www.valueinvestorsclub.com/idea/CSX_CORP/64662

http://search.lycos.in/web/?keyvol=00cffdf15e235f65e82c&q=%22CSX%20Corporation%22






http://www.valueinvestorsclub.com/idea/CSX_CORP/64662



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