In Business This Week
THIS RAILROAD MAN JUST LOVES TRUCKS
When Santa Fe Pacific Chairman Robert Krebs looks at the railroad industry, he sees trucks--hundreds of thousands of truck trailers riding his railroad across the U.S., carrying everything from car parts to cat food.
Soon, Krebs will bring his vision of so-called intermodal transportation to a much larger railroad--the proposed combination of Santa Fe and Burlington Northern Railroad. The $2.7 billion deal, announced June 30, would create the continent's largest railway, running from Winnipeg to El Paso. Krebs, 52, would be CEO of the new company.
Krebs moved intermodal shipping to center stage four years ago in a joint venture with J.B. Hunt Transport, one of the country's biggest trucking companies. "Nobody believed in intermodal not that long ago," says PaineWebber analyst Anthony Hatch. But last year, intermodal shipping represented 40% of Santa Fe's revenues. The industry average is 16%.
Krebs, a 30-year industry veteran, also is a hard-nosed manager who has cut Santa Fe's workforce by 11,000, pared $3.6 billion in debt, and boosted profits. He sees trucks on the rails--and he makes them pay off.EDITED BY KEITH H. HAMMONDS By Susan Chandler