WASHINGTON — The split-up of Conrail to Norfolk Southern Corp. and CSX Transportation Inc. — the most recent mega-consolidation in the railroad industry — is working reasonably well so far for the plastics industry.
There have been some minor delays since the June 1 merger, and computer problems that Norfolk is having digesting its share of Conrail will lead to more delays, according to a key plastics industry observer.
But so far, the railroads seem to be taking care that this merger of East Coast rail carriers avoids the outright paralysis that gripped the Gulf Coast in 1997 when Union Pacific bought Southern Pacific, shippers said.
``We are seeing minor delays and we are having difficulty communicating via telephone with CSX and NS,'' said Phillip Rhine, director of corporate logistics at Aristech Chemical Corp. in Pittsburgh. ``We're seeing one- to two-day delays here and there.''
Rhine sits on the Conrail Transaction Council, which was set up by the railroads to handle the split. Rhine represents the Washington-based Society of the Plastics Industry Inc.
Norfolk Southern told shippers June 7 that computer problems will mean more delays, which Rhine said he interpreted could mean ``major delays'' because the carriers are trying hard to make routes more efficient and run more trains over the same number of tracks.
Norfolk, Va.-based Norfolk Southern experienced computer problems meshing its system with Conrail's and had some delays in dispatching trains and crews in the Conrail territory it bought, said Norfolk spokeswoman Susan Terpay.
``Our train operations, while not perfect, continue to improve every day,'' she said.
The railroad hired 2,500 new train crew members in the last two years to beef up staff for the merger and plans on hiring another 1,000 this year, she said.
Norfolk and CSX spent a lot of time planning the merger, including delaying its start date, because they knew shippers and Congress would be up in arms if this merger melted down, said Maureen Healey, director of transportation issues for SPI.
``They did unquestionably as much due diligence as possible,'' she said.
But shippers noted it may be too soon for problems to emerge. For Union Pacific, serious problems did not start until months into the merger, Healey said.
CSX, based in Jacksonville, Fla., and Norfolk both had labor agreements in place before the split date.
CSX said it has had problems getting crews to trains, but has teams in place to address congestion, said spokeswoman Jane Covington.
``It is going as well as we expected,'' she said.