From the Editor: Change, new realities and the eyes of beholders

By Pat Foran, Editor-in-Chief

A colleague told me about CSX President and CEO Joe Hinrich’s ouster in the early morning hours of Sept. 29 while I was in Omaha preparing to interview Union Pacific Railroad CEO Jim Vena for a story I’m writing for our November issue. Our 2025 Railroad Innovator Award recipient, Vena told me he heard the news — that CSX’s board had named Steve Angel to succeed Hinrichs — while driving into work that morning.

“Son of a gun, change happens fast, doesn’t it?” said Vena, who’s been something of a quick-change artist himself.

Angel is the former CEO of Linde plc and predecessor Praxair Inc. He “has a long and proven track record of leading high-performing teams, fostering a collaborative culture and driving operational excellence and growth, while maintaining disciplined capital allocation and attractive returns on capital,” CSX officials said in a press release. Angel said he looked forward to continue building on CSX’s “strong momentum, advancing key initiatives aimed at driving long-term growth.”

The hiring of Angel came after CSX faced pressure from activist investor Ancora Holdings LLC. In August, Ancora called on the Class I’s board to explore merger options in light of the proposed UP-Norfolk Southern Railway merger.

Ancora praised the CEO swap-out. “CSX and other Class I railroads have no choice but to embrace the industry’s new realities,” Ancora officials said. “[Angel’s] M&A pedigree and value creation record indicate his appointment is an initial step in the right direction for CSX.”

Of course, realities and right directions are in the eye of the beholder.

At CSX’s November 2024 Investor Day, Hinrichs said 2025 would be “a tough year, especially operationally, notably due to the Howard Street Tunnel project,” independent transportation analyst and Progressive Railroading columnist Tony Hatch reported in a Sept. 30 message to his clients. “CSX appears to be on track for the I-Day goals and should finish H2/25 very strong.”

As for whether Hinrichs had embraced the industry’s new realities: He “certainly did not stand in the way of a merger,” Hatch wrote, adding that UP’s SEC Form S-4 “proves that UP went to NS so he didn’t ‘botch’ any deal.” As for where CSX fits within today’s M&A landscape: “CSX is a target and can’t get their dress any tighter than they have (‘open for anything to help shareholder value’),” Hatch wrote.

At the National Association of Rail Shippers annual meeting in May, Hinrichs characterized 2025 as a “transition year ... a very important, and even transformative year.” CSX was planning for growth, with intermodal presenting the biggest opportunity, he said. “We have to remind people it’s more of a long-term value creation,” Hinrichs said.

Of course, long-term value creation and the thing called “growth” are in the eye of beholder, too. Those terms are being defined, and strategies are being refined and in various stages of being executed — at CSX and industry-wide. It’s essence stuff.

How it all plays out, and how quickly, is anybody’s guess. Not all quick-change artists’ best-laid plans will go according to plan. Essences aren’t immune to change; essence change just takes time to unfold. Like pretty much everything in rail does.