School of Business

Faculty 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: - Q1202
Course 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 and
eventually incorporate the varied railroads closely-held by those predecessors
into one line
that
became referred
to
as CSX
Transportation.
CSX was incorporated in 1978 below Virginia law. In 1980, the
corporate 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 coal
fields to growing southeastern markets. Later, the Companys acquisition of
key parts of Conrail, Inc. allowed CSXT to link the northeast, as well as New
England and
also
the New
York metropolitan area,
with Chicago
and western markets also because the growing areas within the southeast already
served by CSXT. This current rail network permits the corporate to directly
serve each major market within the eastern united states with safe, dependable,
environmentally accountable and fuel economical freight transportation and
intermodal
service.
CSX Corporation presently contains a variety of subsidiaries on the far side CSX
Transportation, 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 Corporation
headquarters 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 2013
results. Volume climbed six percent to 6.9 million units and operational expenses
rose six percent to $9 billion.

1. Rail
CSX Transportation, Inc.
CSXs principal in operation subsidiary, CSX Transportation, Inc. (CSXT),
provides a vital link to the transportation offer chain through its just about twenty
one thousand route mile rail network that serves major population centers
in twenty three states east of the Mississippi, the District of Columbia and also
the Canadian
provinces
of
Ontario
and
Quebec.
It
serves
over 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 facilities
through track connections to just about Two hundred forty short-line and regional
railroads. Carloads total regarding four million annually, with commodities starting
from coal, biodiesel and ethanol, to automobiles, chemicals, military equipment,
forest merchandise and client merchandise.
The
company's wheeled
vehicle includes a fleet of quite four thousand locomotives and eighty thousand rail
cars, and rail network includes thirty six yards located in sixteen states.
CSXTs 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. CSXTs 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 also
the Middle West to metropolitan areas in New York and New England. This
route, additionally referred to as the water level route, has minimal hills and
grades and nearly all of its 2 main tracks (referred to as double track). These

superior engineering attributes allow the passageway to support consistent, highspeed intermodal, automotive and merchandise service. This passageway may be
a primary route for import traffic returning from the Far East through western ports
moving eastward across the country, through Chicago and into the population
centers within the Northeast. The I-90 passageway is additionally a vital link
between ports in New York, New Jersey, and Pennsylvania and consumption
markets within the Middle West. This route carries goods from all 3 of the
Companys major markets merchandise, coal and intermodal.
Interstate 95 (I-95) Corridor- The CSXT I-95 corridor connects
Charleston, Jacksonville, Miami and plenty of different cities throughout the
Southeast
with
the
heavily inhabited northeastern
cities
of Baltimore, Philadelphia and New York. CSXT primarily transports food
and client merchandise, additionally as metals and chemicals on this line. Its 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 CSXTs
western gateways of Chicago, St. Louis and Memphis through the cities
of Nashville, Birmingham, and Atlanta and markets within the Southeast. The
Southeastern passageway is that the premier rail route connecting these key cities,
gateways, and markets and positions CSXT to with efficiency handle projected
traffic volumes of intermodal, automotive and general merchandise traffic.
The passageway additionally provides direct rail service between the coal reserves
of the southern Illinois basin and therefore the increasing demand for coal within
the Southeast.
ORPORATION CSX CORPORATION
CSX CORPORATION

2. Industrial
Locomotives
CSXT
operates over four
thousand
locomotives;
of that over ninety
fifth are closely-held by CSXT. Freight locomotives are the ability supply used
primarily to drag trains. Change locomotives are employed in yards to type railway
cars so the proper railcar is hooked up to the proper train so as to deliver it to its
final destination. Auxiliary units are usually accustomed give further traction for
serious trains in rough terrain.

Equipments

The Companys equipment consists of freight cars, containers and chassis.

Gondolas- Support CSXTs metals markets and supply transport for woodchips
and different bulk commodities. Some gondolas are equipped with special hoods
for
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 to
accommodate 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 upon
Commodity 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 in
small 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 and
tri-levels for sedans and smaller automobiles.
Flat cars- Used for shipping intermodal containers and trailers or bulk and
finished 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 be
connected to a tractor. All the companys chassis are leased.
The manufacturer also has different varieties of equipment similar to lift apparatus
and double stack railcars, which permit for two containers to be, mounted one
above the opposite.

Automotive

CSXs 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 facing
challenges because of weather. CSX serves automotive producing plants and
assembly centers in eight states and provides a network of foremost vehicle
distribution 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. CSX
has robust relationships with ancient domestic makers General Motors, Ford, and
Chrysler, 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.

Chemicals
Growth occurred across most markets reflective improvement in demand for
intermediate merchandise
utilized
in producing vehicles and commodity. Several plastics
and
chemicals are key
inputs within the production of each sturdy and unserviceable product, still as
packaging.
CSX touched a complete of 620,000 carloads of chemicals and fossil
fuel commodities in 2014 for revenue of $2.18 billion a 15 % increase over 2013.

Growth was driven by an oversized increase in energy-related markets (crude oil,

frac sand, and natural gas liquids) as a result of the rise in shale drilling activity in
North
America.
The
CSX
chemicals
portfolio is
very wide-ranging,
serving many chemical customers, plastics converters, glass producing plants,
chemical plants, and refineries. Chemical-related shipments primarily move in
CSXs
single
car
merchandise
network.
.

Metals
Volume growth was driven by increased shipments of sheet steel for auto
production, increases in scrap steel resulting from higher steel production and
increases in energy-related products.
CSX moved a total of 276,000 carloads for its metals business in 2014 for revenue
of $701 million a nine percent increase over 2013.
Overall, CSX has more than 700 metals customers in its network and serves all
metal-producing states east of the Mississippi. In the U.S., 87 percent of steel is
produced within the footprint of CSXs network.

Minerals

CSXs minerals business unit moved a total of 293,000 carloads in 2014 for
revenues of $459 million an increase of six percent over 2013. Revenue
increased across all eight lines of business.

Waste and Equipment

CSXs waste and equipment business affected a complete of 158,000 carloads in

2014 for revenue of $309 million a 17 % revenue growth compared to 2013.
2014s strongest areas among the market were municipal and construction waste,
dimensional moves together with wind energy; machinery; transportation
equipment, and government moves, with a number of these being bellwether
industries within the U.S. economy. the widely rising economy and construction
activity provided several opportunities to grow rail volume for the
key commodities among this portfolio. The Waste &equipment cluster serves a
various set of shoppers, together with municipalities, waste-hauling firms,
metal process, HAZMAT clean-up firms, and original equipment makers. The
CSX network moves client and HAZMAT waste to massive regional landfills
with additional competitive valuation than native disposal facilities, providing
a cheap various to transport.
CSX additionally safely
moves
over

dimensional product as
construction equipment.

well as

farm

and

3. Agricultural
Agricultural Products
Volume grew with raised shipments of feed grains and ethanol. Shipments of feed
grains improved with expanded meat production and lower wheat
imports. Ethanol shipments grew because the quantity of ethanol in
fuel continuing to extend. CSX captive a complete of 419,000 carloads of
agricultural merchandise in 2014 for revenue of $1.1 billion a 12 % increase
from 2013. Volume will increase were driven by gains within the grain and
ethanol markets. The majority of CSXs agricultural traffic is domestic shipments
that 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 Fertilizers

Volume multiplied as a result
of strength in demand
for domestic
fertilizers attributable to a powerful planting season and because of refilling of low
inventories. In 2014, CSXs phosphate and fertilizer business affected 330,000
carloads for revenue of $534 million a 1 % increase over 2013.
A late planting season brought domestic shipments higher than traditional well
into June, and that they remained sturdy through the third quarter. Overall, rock
revenue was up for the year, and robust revenue improvement was seen
in Nitrogen fertilizers and export Phosphate. Within the fourth quarter, some
domestic
Phosphate
demand
went unsuccessful as a
powerful grain
harvest place significant demand on the lined hopper fleet utilized by each
commodity. Additionally,
low natural
gas costs within
the U.S
have 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 service
the potash originating in American state and Utah, and has access to Eighteen East
and Gulf Coast ports.

Food and Consumer

Volume raised slightly as strength in refrigerated product, primarily fruits and
vegetables, and alcoholic beverages were part offset by weakness in demand for
appliances.CSXs food and customer business moved a complete of ninety four
thousand carloads in 2014 for revenue of $265 million a 1 % decrease from

2013. Volume declined because of a discount in shipments altogether markets with

the exception of alcoholic beverages, that knowledgeable a robust performance as
a result of raised volume with one of CSXs customers. Severe winter weather
caused longer automotive cycle times that evidenced to be a challenge throughout
the year for food shipments which require prompt and timely service.
Fifty percent of CSXs food and shopper market are dry grocery merchandise
that embraces alcoholic and non-alcoholic beverages, canned foods, and
dry foodstuff. Quite 30 % of shipments temperature controlled product, together
with fruit
crush and manufacture. Shopper product,
together
with factorymade merchandise and appliances, structure the balance. The reach of the CSX
network, together with
strategic
partnerships
with different transportation suppliers, edges customers by making direct lines
to process plants
that manufacture
food
and potable product,
appliances,
and different shopper product.
As shopper demand continues to extend, CSX is poised to produce premium
service for food product and beverages. Meanwhile, the CSX facilitated
food network can still expand into the Southeast and also the company can expand
to service further key growth regions for foodstuff demand. Overall, CSXs food
and customer business is poised for long-term growth.

4. Housing and Construction

Emerging Markets
Shipments increased in limestone, transportation equipment and aggregates (which
include crushed stone, sand and gravel) as a result of overall market growth due to
the improving economy.

Forest Products
Volume raised with strength in shipments of pulp board and paper utilized
in packaging for customer
product.
Volume conjointly raised slightly in
construction-related markets. CSX moved a complete of 307,000 carloads for the
forest merchandise market in 2014, generating revenue of $819 million a
6% increase over 2013 results. Continual improvement within the housing and
associated markets bolstered each revenue and volume growth for the
forest 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 electronic
media has dampened demand for printing paper and newsprint, demand for
packaging paper was robust, wood pulp remained stable, and forest product stay an
integral a part of CSXs portfolio.

5. Coal
Volume was basically flat as increased export shipments were offset by weakness
in 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 customers
were down as high utility stockpiles were reduced throughout the year and are
approaching targeted levels. The increase in revenue per unit was driven by
improved yield, higher fuel recovery and longer length of haul. Total coal volume
is expected to increase as the Company expects to ship approximately 35 40
million tons of export coal and projects increases in utility coal volume in 2011.
CSXs 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 the
heart of the Appalachian coal fields, and also serves the growing Illinois Basin coal
fields and major interline connections to railroads originating western coal. CSX
moves coal shipments to major export terminals in Newport News, Virginia;
Baltimore, Maryland; and Mobile, Alabama. It also serves two coal terminals
on 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 in
natural gas prices from the previous year. Increased coal use rapidly drew down
existing inventories, requiring stockpile replenishment to return inventories in the
north to more normalized levels. Southern inventories remain above normal.
Export volume was down 12 percent from2013, due to over-supply in the global
market.

6. Intermodal
Global and home shipment growth resulted from U.S. Inventory replenishment,
elevated U.S. Exports, new business, truckload conversions, and new UMAX and
door-to-door provider choices. The revenue-per-unit decline was once driven by
means of the have an effect on of switching from a purchased transportation
association to a home interline application at the begin of 2nd quarter. This
application, referred to as UMAX, supplies consumers with containers for nearby
shipments or transcontinental provider offered jointly with the aid of CSX and
Union Pacific Company. This income-per-unit decline was once partly offset via
expanded gas recuperation and an increased pricing atmosphere.
CSXs 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 community
in 19 states and within the Canadian province of Quebec. Intermodal supplies key
advantages to shippers looking to optimize give chains through scalable potential,
sustainable savings, and community flexibility. In home markets, drivers included
freeway-to-rail conversions, elevated demand from new and existing customers,
service product enhancements, and improved access into smaller markets through
CSXs mixed hub-and-spoke and hall community method. Global intermodal
volume development was once pushed via a getting better economic climate and an
expand in international container shipments relocating to inland destinations. CSX
and executive partners are investing in infrastructure to develop ability on the
manufacturers rail community, which presents great public advantages, including
job production, expanded business at U.S. Ports, lowered freeway congestion, and
reduce 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. To
additional prolong intermodal solutions, two new intermodal terminals opened in
2014 in Sala berry-de-Valleyfield, Quebec, and in winter Haven, Florida with the
aid of public partners.

Comparison With Competitors

And Pricing Strategies
CSX competes inside the broader transportation offerings marketplace. The
enterprise competes immediately with truck, barge and different rail transportation
providers. Although transportation modes and detailed vendors are in direct
competitors, they most commonly work cooperatively to offer services that
combine modes. For illustration, railroads work with truckload carriers to offer
door-to-door container and trailer offerings to shippers.
The business atmosphere wherein the manufacturer operates is extremely
competitive.
Shippers probably prefer transportation vendors that offer the most compelling
mixture of service and price. Carrier requirements, each in phrases of transit time
and reliability, fluctuate by using shipper and commodity. Hence, the corporations
fundamental competition varies by way of commodity, geographic place and mode
of to be had transportation. CSXTs most important rail competitor is Norfolk
Southern Railway, which operates in the course of so much of the companys
territory. Different railroads also operate in ingredients of the companys territory.
Relying on the targeted market, competing railroads and deregulated motor carriers
could 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. Norfolk
Southern lumps more than one class of shipments beneath the heading "general
merchandise", at the same time CSX and Union Pacific are extra precise about
chemical compounds, industrial merchandise, car, and extra industries.
One among Union Pacific's primary accomplishments within the last a couple of
years has been the corporation's capacity to deal with depressed coal prices. Last
quarter was no exceptional with Union Pacific as the only one of the crucial large
three railroads to record constructive sales development in coal shipments. With
CSX and Norfolk Southern reporting coal revenues down 7 % and 9%
respectively, reporting growth in coal revenues is an excellent feat by Union
Pacific. It should come as no shock that Union Pacific's superior performance in
the susceptible coal segment also allowed the railroad to report an operating
margin larger than either of its competitors as well. All matters being equal, a
company with a bigger running margin is more insulated from pricing challenges

and weaker demand. With an running margin of over 35%, Union Pacific is not
only 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 a
tremendous change, but with Union Pacific posting over $5 billion in income each
quarter, this 3% better working margin method hundreds of thousands extra in
gains.
Union Pacific's better coal performance and a better operating margin are two
foremost motives within the enterprise's better money waft. Many investors use
money flow growth as a key factor in figuring out what stocks to purchase. For the
reason that gains can be manipulated, money drift is a extra pure measure of what a
corporation can return to shareholders.
CSX company may have been tough-hit by using the railroad industry's
disappointing fourth quarter, nevertheless it's faring a long way better than primary
competitor 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, when
earnings dropped a whopping 29 percentage.
Now, the manufacturer has plans to cut expenses by means of more than $650
million annually by 2020, shaving jobs, advantages and fuel bills, consistent with a
organization statement. The company will start by means of slicing $130 million in
2016. Now, the corporation has plans to reduce expenditures by greater than $650
million yearly by way of 2020, shaving jobs, advantages and gasoline expenses, in
line with a manufacturer statement. The company will start via chopping $one
hundred thirty million in 2016.
The railroad plans to lower overall headcount via 6.7 percent, specializing in these
areas 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 the
changes, the manufacturer plans to have an working ratio under 70 percent in 2016.

Promotion
The United States Surface Transportation Board (STB) authorised the CSX
acquisition of an working easement referred to as the Elsdon Subdivision from the
Grand Trunk Western Railroad. In particular, greater than 22 miles of track from
Munster, Ind., into Chicagos 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 forty
mph, to higher serve our patrons, to measurably curb coach idling time, and in
some 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 various
segments of the Elsdon Subdivision. Multiplied coach operations on the Elsdon
line is required in anticipation of balancing future regional economic progress.
These trains will exceptionally run at off top instances. These changes in freight
site 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 by
means of education and realization.
NASCAR sprint Cup sequence rookie Chris Buescher will promote railroad
security with CSX in 2016, with the transportation enterprise returning its Play It
trustworthy 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 Row
Motorsports for the previous three sprint Cup sequence seasons to unfold the
message to Play It safe around railroad tracks and to Brake for Trains. As one
of the vital nations 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.

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