CEO's death clouds CSX deal
BY LINDELL JOHN KAY
Monday, December 18, 2017
The sudden death of CSX’s top executive most likely will not mean a reversal of course for the railroad giant’s derailed $270 million train hub in Rocky Mount.
Hunter Harrison died Saturday “due to unexpectedly severe complications from a recent illness,” according to a statement from CSX. The 73-year-old executive had taken a medical leave of absence Thursday sending company shares tumbling as much as 10 percent on the Nasdaq.
Interim CEO Jim Foote said the company would honor Harrison’s legacy by staying focused on his business plan of moving away from intermodal terminals.
That is bad news for Rocky Mount. Construction of the Carolina Connector, a trains-to-truck terminal on U.S 301 across from Wesleyan College, that was set to begin next month. Building the facility would have created up to 300 short-term jobs. Once operational, the hub would provide more than 300 direct, long-term jobs with average annual salaries of more than $60,000. Over time, the hub was expected to produce more than 1,500 jobs statewide, while attracting new businesses to the area and pumping an estimated $125 million into the state economy.
That all seems unlikely now. Foote, who also holds the titles of chief operating officer and chief sales and marketing officer, said he will follow through with the company’s wide-ranging overhaul.
Local economic developer Norris Tolson, CEO of Carolinas Gateway Partnership, which was instrumental in attracting CSX to the area, could not be reached for comment Sunday.
Tolson said last week that he was in a holding pattern while the railroad figured out its new business model.
Since the 2015 announcement that CSX planned to build a hub in Rocky Mount, the railroad has been busy with property acquisition, permitting, preliminary engineering and design, and roadway improvement.
Tolson said last week he would hate to see so much work go to waste. He said CSX’s new model still calls for a hub in the region and the company should use the Rocky Mount site were so much effort already has been spent.
Harrison, a larger-than-life figure in the railway industry, led the much-lauded turnaround of two Canadian railroads, but took medical leave in 2015 after surgery and a bout with pneumonia. He was hired by CSX in March with a four-year $300 million contract and given the daunting challenge of improving CSX’s stockholder value.
Harrison worked from home and was spotted with an oxygen tank when meeting with CSX investors last month. The company, which was slow to disclose Harrison’s health problems, has provided no details about his cause of death.
Harrison’s plans to scrap the trains-to-truck terminal in Rocky Mount were reported in an industry magazine in last month, causing a shakeup among local officials counting on the job-creating intermodal railroad hub to bolster the city’s economic development.