Amtrak Names New CEO

Amtrak is naming Norfolk Southern Corp. veteran Charles "Wick" Moorman as its next chief executive as the national passenger railroad confronts big projects amid growing demand.

Mr. Moorman will succeed Joe Boardman, who is due to retire this fall as president and chief executive officer, a post he has held for eight years.

Mr. Moorman, who served as Norfolk Southern's chairman and CEO before retiring last year, is expected to serve as a "transitional" leader of the passenger railroad, Amtrak Chairman Anthony Coscia said. Amtrak didn't immediately make Mr. Moorman available for comment on Friday.

Mr. Coscia praised Mr. Moorman's record on financial performance, customer service and safety—skills he said would help the railroad reduce operational losses, expand service and improve reliability to meet growing demand.

"Amtrak is a company that spent decades just surviving," Mr. Coscia said. "We have moved out of that period, thankfully, and we've moved into a period where there is tremendous opportunity for us to make this a viable part of the country's transportation system."

Mr. Moorman is expected to start on Sept. 1, earning a salary of $1 a year, with an annual bonus of $500,000 tied to performance goals, Mr. Coscia said.

Mr. Moorman will take over Amtrak as it embarks on what transportation officials say is the largest public works project in the U.S. once it gets under way: the construction of two new Hudson River rail tunnels connecting northern New Jersey and Manhattan.

Amtrak's leaders have tried to reduce the taxpayer-funded railroad's reliance on public subsidies amid pressure from Congress and generally increasing ridership, particularly on its heavily traveled Northeast Corridor service between Washington, D.C., and Boston.

To increase the railroad's reliability, Amtrak has quarreled with freight railroads over regulations that give the passenger railroad "preference" to go first on those carriers' rail networks around the country.

But Mr. Coscia said he hoped Mr. Moorman would improve the railroad's relationship with freight carriers, which own the tracks that carry Amtrak passengers nationwide. Amtrak owns much of its network in the Northeast.

"He clearly understands both worlds, and he's going to be in a position to try to get us all to a much better place," Mr. Coscia said of Mr. Moorman.

Amtrak has suffered a series of safety lapses in recent years. Among the most tragic came in May 2015, when a New York-bound train derailed in Philadelphia as it sped through a tight curve, killing eight passengers.

More recently, in April, two of its own workers were struck and killed on the tracks near Chester, Pa. An investigation indicated the workers didn't deploy a basic safety device that experts say would have stopped the train.

The incident also highlighted a rift between Amtrak management and a key union representing workers who maintain the railroad's tracks.

Mr. Boardman, who is expected to leave Amtrak at the end of September, has led the railroad since November 2008. He previously held the top posts at the Federal Railroad Administration and New York's Department of Transportation.

Mr. Moorman, who joined Norfolk Southern's predecessor in 1970 and took the helm in 2006, was considered one of the great railroad CEOs and an operational expert thanks to his years of experience at the company. He led Norfolk Southern through a period of rapid growth into 2014, as crude-by-rail and the transportation of cargo traditionally carried by truck increasingly moved to the tracks.

At the time Mr. Moorman stepped down as Norfolk Southern CEO in mid-2015, that major freight rail boom was winding down and volumes were starting to fall. The railroad was struggling to figure out efficiency as traffic fell that year and reported the worst operating ratio, a key profitability metric, of the major North American railroads in the second quarter of 2015.

That gave fuel to Canadian Pacific's attempt at acquiring its U.S. neighbor late last year, as executives there touted a plan to streamline and improve operating efficiencies for the combined railroads.

Current Norfolk Southern CEO Jim Squires outlined an aggressive plan to cut costs and improve efficiency, and Canadian Pacific eventually dropped its bid.

Write to Andrew Tangel at Andrew.Tangel@wsj.com and Laura Stevens at laura.stevens@wsj.com

(END) Dow Jones Newswires

August 19, 2016 13:05 ET (17:05 GMT)

Canadian Pacific Kansas ... (TSX:CP)
Historical Stock Chart
From Mar 2024 to Apr 2024