CSX Announces Risk Reduction Plan, Higher Safety Spending
The board of directors of Jacksonville, Fla.-based CSX Corporation -- one of the largest U.S. transportation companies, with extensive rail operations in the East -- will raise its capital spending to accelerate improvements in safety, service reliability, and capacity. The company also said yesterday that it will buy back another $1 billion of its own stock, raising its current buyback program to a total of $3 billion.
Joseph Boardman, administrator of the Federal Railroad Administration, said the safety spending decision "reflects a wise commitment to making the kind of funding priorities needed to improve its operations and better safeguard neighboring communities. In particular, CSX’s decision to establish a risk reduction program by expanding its use of technology to identify track and equipment problems before accidents occur is the right approach the rail industry needs to follow," Boardman added. "As we continue to review the company’s safety operations, we look forward to learning exactly how and when the additional safety funding will be invested across CSX’s rail network.”
The company's chairman, president, and CEO, Michael Ward, said the actions "emphasize our confidence in the earnings power of CSX businesses as demand for our rail and intermodal services is robust and expected to grow." CSX's core capital investments will be approximately $1.5 billion this year, $1.6 billion in both 2008 and 2009, and $1.7 billion in 2010. This spending will improve and add track, equipment, technology, and facilities, the company said.