Newspaper article The Florida Times Union

UPS Lightens CSX's Load

Newspaper article The Florida Times Union

UPS Lightens CSX's Load

Article excerpt

Almost three months after CSX Corp. and Norfolk Southern Corp. divvied up Conrail, one of their largest customers says the resulting service glitches are serious enough that it is finding other ways to ship merchandise.

United Parcel Services of America Inc., based in Atlanta, says it is diverting 50 percent of its rail business to trucks because of deteriorating service.

Officials at Jacksonville-based CSX Intermodal Inc., which handles the UPS shipments, say that's news to them.

"We have not been notified of any significant diversions of their business," said Dan Murphy, a spokesman for CSX Intermodal, a subsidiary of Virginia-based CSX Corp.

CSX Intermodal handles the shipping of trailers and containers, which is the service UPS uses. The railroad is run by CSX Transportation, also based in Jacksonville.

UPS officials describe the railroads' service as a roller coaster of ups and downs since the two companies took over Conrail's lines on June 1.

After UPS complained about delays in early June, CSX ran special trains between Jacksonville and Baltimore with the package company's shipments. But conditions did not improve, Black said.

"The problem is that [both railroads] are not making the trains run on time," Black said. "And the problem is getting worse.

"We have no idea what the problem is, but we do know the situation started deteriorating literally the first week of the split."

UPS began diverting about half of its rail shipments to trucks when the problems persisted. Earlier this month, it began relying more on the railroads when officials saw improvements.

Then conditions worsened, Black said.

"All of a sudden it started deteriorating again," he said. "And it got so bad again that this week, we have had to go back to diverting roughly 50 percent."

Now UPS is using its trucks instead of trains, which is costing the company more in overtime pay, transportation and labor-related costs, according to Black. …

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