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(Source: Bloomberg, August 3, 2022)

U.S. freight railroads are in a bit of a predicament, and it’s not just because they are going down to the wire on labor contract negotiations with their 115,000 workers. Large railroads, including Union Pacific Corp. and Warren Buffett’s BNSF Railway Co., have juiced their profits so high by increasing efficiency and paring their workforces over the last several years that they have boxed themselves into a corner with no catalyst to keep attracting investors. In pushing those margins over the past five years to a level that analysts most likely would have thought were unobtainable, the railroads have angered their customers with high prices and poor service and have alienated their workers, who complain they’re being overworked after the railroads cut their ranks as much as possible.

Full story: Bloomberg