New Union Pacific Chief Says Railroad Is Rapidly Improving
And he thinks it's better that way.
Three months ago, when Ike Evans took over the top leadership post at the nation's largest railroad, Union Pacific was coming off one of the worst years in its proud history.
"Because of our service crisis, we had a mandate to do things differently," Mr. Evans said Tuesday. "We had to take the best things UP does and go from there. A lot of fixing this railroad meant going back to the basics. And we needed a fresh perspective."
Before joining the company, Mr. Evans was a senior vice president of the Emerson Electric Co. of St. Louis. Before that, he worked for General Motors. His businesses used railroads, which he feels gives him a unique perspective.
"I understand what customers expect, what customers want," Mr. Evans said.
What customers don't want, Mr. Evans knows, is poor service, which is what they got last year. After the railroad's acquisitions of Chicago & North Western and Southern Pacific, Union Pacific ran into a host of crises including poorly maintained track, floods in the South and a booming plastics industry in Texas.
The railroad was overwhelmed and its service suffered, with the average speed of its trains dropping from 19 mph to 12 mph.
Manufacturing plants across the nation had to close because of no arriving raw materials or no available trains to ship their goods.
Farmers were forced to store their grain on the ground. Losses were estimated in the hundreds of millions of dollars.
As a result, more than 10 percent of Union Pacific's customers found other shippers and the railroad's stock lost more than half its value.
Armed with an outsider's view, Mr. Evans has gone to work repairing the damage Union Pacific suffered in the last year. Realizing "you can't run an entire railroad from Omaha," the railroad has
ecentralized operations into three areas and given the executives in charge more autonomy.
The railroad also has continued with its plans to upgrade its lines through the Midwest. On Tuesday, Evans and other executives dedicated a new 32-mile stretch of double-track line between the
estern Iowa cities of Missouri Valley and Denison. The project is part of a five-year, $856 million program of track expansion on the railroad's central corridor, which runs from Chicago to Salt Lake
ity.
