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CSX Railway Uses OR to Cash In on Optimized Equipment Distribution

Author

Listed:
  • Michael F. Gorman

    (Department of Management Information Systems, Operations Management, and Decision Sciences, School of Business, University of Dayton, Dayton, Ohio 45419)

  • Dharma Acharya

    (CSX Transportation, Jacksonville, Florida 32202)

  • David Sellers

    (CSX Transportation, Jacksonville, Florida 32202)

Abstract

Each day, CSX Railway allocates hundreds of empty railcars among hundreds of customer car orders. In 1997, it implemented the US rail industry's first real-time, fully integrated equipment-distribution optimization system, the dynamic car-planning system (DCP). DCP seamlessly integrates operations research modeling into CSX's process that assigns empty cars to customer car orders. CSX estimates that the DCP system saves the company more than $51 million annually and has saved $561 million since its implementation. DCP has also provided $1.4 billion in capital-expenditure avoidance because of more efficient car allocation. Fewer railcars yield improved return on assets and reduced congestion on the CSX rail network. Customer satisfaction has also increased because of improved empty-car delivery. Public benefits include improved highway safety; reductions in congestion, pollution, and greenhouse gases; and reduced tax-supported road maintenance, thus saving an estimated $600 million.

Suggested Citation

  • Michael F. Gorman & Dharma Acharya & David Sellers, 2010. "CSX Railway Uses OR to Cash In on Optimized Equipment Distribution," Interfaces, INFORMS, vol. 40(1), pages 5-16, February.
    • Handle: RePEc:inm:orinte:v:40:y:2010:i:1:p:5-16
    DOI: 10.1287/inte.1090.0465
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    References listed on IDEAS

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    Cited by:

    1. Zu, Yue & Heydari, Ruhollah & Chahar, Kiran & Pranoto, Yudi & Cheng, Clark, 2022. "A railcar re-blocking strategy via Mixed Integer Quadratic Programming," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 162(C).
    2. Michael F. Gorman & John-Paul Clarke & Amir Hossein Gharehgozli & Michael Hewitt & René de Koster & Debjit Roy, 2014. "State of the Practice: A Review of the Application of OR/MS in Freight Transportation," Interfaces, INFORMS, vol. 44(6), pages 535-554, December.
    3. Michael F. Gorman, 2016. "From Magnum Opus to Mea Culpa: A Cautionary Tale of Lessons Learned from a Failed Decision Support System," Interfaces, INFORMS, vol. 46(2), pages 183-195, April.
    4. Michael F. Gorman, 2010. "Hub Group Implements a Suite of OR Tools to Improve Its Operations," Interfaces, INFORMS, vol. 40(5), pages 368-384, October.
    5. Michael F. Gorman, 2023. "Case Article—Louisiana Branch Lines," INFORMS Transactions on Education, INFORMS, vol. 23(3), pages 139-143, May.
    6. Ruhollah Heydari & Emanuel Melachrinoudis, 2017. "A path-based capacitated network flow model for empty railcar distribution," Annals of Operations Research, Springer, vol. 253(2), pages 773-798, June.

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