Norfolk Southern declining
Tempting as it may have been for some to chuckle at Norfolk Southern’s unpleasant fourth quarter earnings report, the news included a couple of eyebrow raisers for those still hoping for nationwide rail safety reform and for the company to fulfill the promises it made nearly a year ago in East Palestine.
According to its quarterly earnings call, Norfolk Southern’s profits fell 33%, with the cost of the cleanup after the fiery derailment in East Palestine reaching $1.1 billion. That includes $836 million for environmental-related expenses and $381 million for community assistance and legal fees. The number is up $150 million from last quarter and is expected to grow.
Of immediate concern for residents in and around East Palestine may be the worry that Norfolk Southern will use the quarterly numbers as an excuse to further delay fulfilling the promises made by CEO Alan Shaw immediately after the disaster.
But a deeper concern comes in the knowledge that Norfolk Southern plans to lay off 7% of its managers in 2024, and plans to find ways to run more trains with the same number of crews by speeding up how quickly cargo moves across the railroad to help reduce its costs.
Though Shaw bragged that the company “invested in our people, enhanced our service performance and made a safe railroad even safer,” such (ahem) efficiencies are enough to make residents all across the country worry whether Norfolk Southern is reveling in Congress’s continued failure to pass real rail safety reform. The planned changes sound almost like a thumbing of the nose at those who have pleaded for railroads to work toward improved safety, not build in greater risk.
Even without the costs associated with East Palestine, Norfolk Southern’s profits would have been down 14% for the quarter. The company is facing a number of challenges. Neither company officials nor lawmakers in Washington, D.C., must be allowed to pretend those challenges are a reason not to remain accountable.