CSX's service metrics improved significantly in the first quarter, with average terminal dwell and train speed each improving 17% (based on U.S. Surface Transportation Board reporting). We attribute these improvements to higher headcount and favorable weather in the eastern U.S. for most of the quarter. With these metrics now in line with, or better than, pre-pandemic levels, we believe the company will be better able to serve customers and reduce costs associated with equipment rental and purchased services. Despite a weakening macroeconomic environment, we anticipate improved service will allow CSX to grow volumes for certain commodities, such as those related to automotive production, by recapturing some shipments previously lost to trucks. Coal also stands to benefit from elevated (though declining)
