STB UPDATE

DECEMBER 26, 2017

2

Network healthy, performed well heading into holiday week

Dwell, velocity, originations and arrivals improved; nearly all measures outperforming 2016

Right Car Right Train increased

Crew and power resource levels remain well matched to demand

Hump yard performance steady

Western terminals performing well

Car fulfillment settled higher, averaging 93% since improved order fulfillment process began

Local pull and place performance stable

Customer problem logs remained at lower levels

Interchange volumes current and gateways fluid

Last week’s operations focused on clean execution and clearing the network in advance of the holiday, during which many customers planned to shut down for the long weekend

3

Velocity fully recovered, continues to outperform 2016

10

12

14

16

18

20

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51

Velo

city

Week

2016 2017

PSR Implementation Height of Service

Disruption

STB Listening Session

Velocity (mph)

Fav (Unfav) % Change vs. 2016

2016 Full Year Average 14.9PSR Implementation 13.8 (7%)Height of Service Disruption 13.0 (13%)STB Listening Session 15.4 3%Current Week 17.7 19%

Note: Velocity displayed according to CSX methodology; explanation of CSX methodology can be found in appendix. Week 37 & 38 velocity excludes specific trains held through Hurricane Irma.

Velocity (mph)ImprovementDegradation

4

Dwell at or below 2016 full year levels for 15th consecutive week

Gross Dwell

8

10

12

14

16

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51

Dw

ell

Week

2016 2017

Dwell (hours)

Fav (Unfav) % Change vs. 2016

2016 Full Year Average 11.2PSR Implementation 11.6 4%Height of Service Disruption 13.1 (17%)STB Listening Session 11.0 2%Current Week 10.3 8%

Dwell (hours)

Note: Dwell displayed according to CSX methodology; explanation of CSX methodology can be found in appendix. Week 37 & 38 dwell excludes terminals that held cars through Hurricane Irma-impacted period.

PSR Implementation

Height of Service Disruption

STB Listening Session

DegradationImprovement

17.4

17.4

17.7

18.0

18.1

17.8

17.8

9.5 10

.2 11.4

11.1

10.1

9.8 10.0

Measures improved versus prior week, nearly all better than 2016

5Note: Dwell and velocity displayed according to CSX methodology; explanation of CSX methodology can be found in appendix. Q3 dwell and velocity exclude the Hurricane Irma-impacted period for terminals that held cars and specific trains held through storm, respectively.

Velocity (mph)

63%

66% 70% 74% 79

%71

% 75%

72% 75% 81

%

84% 87

%

86%

88%

14.914.2

16.2

14.0

15.7 15.414.9 14.9 14.9

16.0 16.4 16.3

17.7 17.717.1

10.0

12.0

14.0

16.0

18.0

20.0

2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50

On Time Originations (%)

Dwell (hours)

68%64%

81%

60%

70%64%63%63%67%67%65%64%

76%72%

66%

20%

40%

60%

80%

100%

2016Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50

On Time Arrivals (%)

On-Time

+2 hrs

On-Time

+2 hrs

11.2 11.610.8

12.1

10.7 11.010.5 10.4 10.5 10.6 10.6 10.7 10.6

9.810.4

6.0

8.0

10.0

12.0

14.0

16.0

2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50

84% 81%88%

74% 74%73% 74% 73%77% 77% 74% 71%

85% 83%78%

20%

40%

60%

80%

100%

2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50

Weekly Average

Dec. 16 – Dec. 22 Dec. 16 – Dec. 22

Dec. 16 – Dec. 22 Dec. 16 – Dec. 22

Weeks

Weeks Weeks

Weeks2017

2017 2017

2017

86% 86%

82%

73%75%76%76%

77%

74%73%72%

74%

78%76%

73%

50%

55%

60%

65%

70%

75%

80%

85%

90%

2016Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50

Weeks

71%

70% 72

%

78%

78%

75%

74%

Dec. 16 – Dec. 22

Right Car Right Train up slightly

6

Right Car Right Train1

1 ‘Right Car Right Train’ is defined as the percentage of cars that departed from a yard in accordance with their car scheduling trip plan

Right Car Right Train is no longer a measure that CSX uses to manage its operation― In precision scheduled railroading (PSR), if a car can

be advanced on another train to speed transit or ensure its on-time arrival, there is not one “right train”

Car priority is to move cars quickly, on next available train― Asset utilization a key tenet of PSR

Train priority is blocking integrity and departing all available, relevant cars from the yard― Blocking integrity certifies that a train is built correctly

and shipments are headed to the correct location― Managed through field supervision

Weekly Average

2017

9,771

9,223

9,690

9,445

9,278 9,264 9,247 9,225 9,204 9,189 9,081 9,049 9,028 8,986 8,953 8,926

0%

2%

4%

6%

8%

10%

12%

8,400

8,800

9,200

9,600

10,000

2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50 51

7

Resourcing appropriately to meet business needs

Power and crew availability steady in fourth quarter at approximately 99% and 95%, respectively

Train & Engine Headcount and Re-crew Rate1Active Locomotives

3,673 3,763

3,376

3,200 3,182 3,184 3,162 3,165 3,174 3,180 3,192 3,200 3,179 3,083

3,013 3,013

2,000

2,400

2,800

3,200

3,600

4,000

2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50 51

1 Re-crew rate is re-crew people starts as a percent of total measured people starts, and represents incidences of replacing a crew on the same train ID (generally due to hours of service)

Locomotive level coming down in concert with network velocity improvement

Recent headcount reduction driven by train staffing efficiency and adjustments to extra boards

2017 Weeks 2017 Weeks

21.6

22.1

22.2

20.4

18.5

18.6

19.2

19.9 20.6

17.2

19.8 17.7

18.8 18.7 20.6 20.8 20.1

21.5 20.1

17.1 17.7

20.8

6.0

10.0

14.0

18.0

22.0

26.0

30.0

2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50

8

Hump yard performance steady

CSX Hump Terminal Overview

Transitioned to flat-switching operations

Hump terminals

Selkirk, NY

Cumberland, MD

Hamlet, NC

Waycross, GA

Atlanta, GABirmingham, AL

Nashville, TN

Louisville, KY

Avon, IN

Cincinnati, OH

Willard, OH

Toledo, OH

1 Dwell displayed according to CSX methodology; explanation of CSX methodology can be found in appendix. Q3 dwell excludes the Hurricane Irma-impacted period for terminals that held cars through the storm.

Absolute number of humps not “good” or “bad”; goal is best mix of hump and flat yards for processing efficiency

Dwell at Hump Terminals1

Dec. 16 – Dec. 22

Weekly Average

Weeks2017

Total hump yard volumes remain in a consistent band week-over-week, well below capacity of yards

Key hump productivity and efficiency measures performing well, four humps remaining

11.5

14.9

11.4 12

.9

11.8

10.1 12

.113.0 13.6 13.4

15.6

12.6

14.4

12.111.4

12.3 12.5 12.4 11.9 11.711.0

11.9

6.0

10.0

14.0

18.0

22.0

2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50

Key terminal productivity and performance measures recovered in former “trouble” spots

Train plan changes at Evansville have resulted in very few cars processed, no longer a key terminal

9

Western terminals performing well

Western Corridor Key Terminals

Birmingham, AL

Nashville, TN

Avon, IN

Evansville, IN

Montgomery, AL

Mobile, AL

Key Western terminals

1 Dwell displayed according to CSX methodology; explanation of CSX methodology can be found in appendix. Q3 dwell excludes the Hurricane Irma-impacted period for terminals that held cars through the storm.

Weekly Average

Dwell at Western Terminals1

Dec. 16 – Dec. 22

Weeks2017

40%

50%

60%

70%

80%

90%

100%

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50 51

Weekly Orders Customer Empty Idles (> 24 hours)

Order Fill % Order Fill % ex. Customer Empty Idles

10

Car order fulfillment settled higher

Weekly Car Orders, Customer Empty Idles, and Fill Rate1

Cars Ordered/Idle

Order Fill Rates

1 2017 fill rate has been normalized through Week 44 against historical/expected order levels (Q1 2017), as order levels disconnected with demand beginning in Q2 2017; 2016 orders and fulfillment and 2017 Week 45 and beyond do not warrant normalizing

Car ordering and fulfillment process updated as of Week 45

― Car orders now remain open for 2 weeks for fulfillment; order fill will settle over a 2-week period

― Accordingly, the current week fill rate will be adjusted in the following week for orders filled

Week 51 added 315 orders filled to week 50, order fill increased to 96%

― Settled weeks 45-50 averaging 93% fulfillment

Empty car dwell remains elevated at customer locations, impacts order fill

― Empty idle cars at a given customer held >24 hours considered available to fill that customer’s orders2017 Weeks

(Prior Process)

11

Last mile performance stable

Local Service Measurement1

94% 95%90%

81% 84% 83% 85% 85% 85% 84% 85%

77%

86% 84% 84% 83%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50 51

1 ‘Local Service Measurement’ is defined as the percentage of cars that were pulled or placed at a customer location based upon daily customer request, the local service plan and available inventory at the local serving yard

2017 Weeks

Local Service Measurement (LSM) is no longer a metric that CSX uses to manage its operation― In precision scheduled railroading (PSR), focus on end-

to-end transit and customer expectations

Accordingly, LSM as a reported metric was discontinued upon start of PSR implementation― At request of STB, last mile tracking reinstated to

monitor through implementation period

Reliable pull and place expected as part of service to customers

12

Customer problem logs remained at lower levels

201

269

416

265 278247 253 254 266

318

213258 257 245 238

Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50 51Weeks

Delayed Cars Bad Order Switching Issues

Customer InquiriesDaily Average Log Volume

Customer logs largely back in normal range after network challenges as fluidity has returned

Lower level of logs, improved communication allowing faster, more comprehensive resolution ― Accountability for resolution of customer issues resides

with field responsibility― Escalating and resolving critical issues with senior

leadership

2017

570 Total Logs in Week 30 at height of service challenges

Interchanges current and performing to expectations

0

200

400

600

800

2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50 51

East St. LouisDaily Average Interchange Volume

From To

0

200

400

600

2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50 51

New OrleansDaily Average Interchange Volume

0

400

800

1,200

1,600

2,000

2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50 51

Chicago Daily Average Interchange Volume

0

100

200

300

2016 Q1 Q2 Q3 40 41 42 43 44 45 46 47 48 49 50 51

MemphisDaily Average Interchange Volume

13

2017 Weeks

2017 Weeks 2017 Weeks

2017 Weeks

14

Precision scheduled railroading producing service improvement

ImproveService

OperateSafely

ControlCosts

Drive AssetUtilization

DevelopPeople

Operational Focus

TerminalFluidity

BalancedTrain Plan

Service Improvements

Rolling StockUtilization

PeopleEfficiency

FuelOptimization

TrainDensity

ImprovedFrequency

BetterReliability

FasterTransit

QuickerTurnaround

Productivity Improvements&

Realigned service frequency in second quarter

Set the groundwork of a balanced train plan in early July

Terminals’ improved efficiency and traffic flow adjustments have recovered service

Improved execution on this foundation to drive long-term service and productivity improvements

APPENDIX

16

Velocity

Former Line of road miles per hour

CurrentTotal miles traveled per hour, including intermediate dwell of the train

ChangeReason

Includes full trip of a train and ability to diagnose overall speed profile (in support of improvement in asset cycle)

Effect onMetric Reported velocity will be lower

CSX has changed methodology on some metrics reported publicly

Dwell

Former Car time at terminal, excluding cars on the same train ID

CurrentAll car time with a terminal work event, including through cars on same train ID (e.g. crew change)

ChangeReason

Includes all dwell with ability to diagnose all events impacting car movement (in support of improvement in asset cycle)

Effect on Metric Reported dwell will be lower

Restated historical data in new methodology available on csx.com/servicemetrics

Cars Online

Former All cars on CSX, as determinedby RailInc

Current

RailInc cars on CSX, excluding cars stored, under repair, sold, and private cars ex online inventory

ChangeReason

More accurate measurement of active cars on line, i.e. cars for which CSX is focused on real-time, efficient movement

Effect on Metric

Reported cars online will be lower