CHICAGO--(BUSINESS WIRE)--March 21, 2003-- Stressed Economy Causes Focus on Cost Containment Railroads face unique challenges, says D. Oscar Groomes, the newly appointed CEO of GE Rail Services in Chicago.
They do not operate over a public right of way. Their tracks and freight yards are their own private property, which they must maintain and manage out of their own revenues.
Groomes, 43, acknowledged that railroads have performed better than the airlines since both were deregulated in the late 1970s. They really are doing an excellent job of containing costs, he said, which is one of the reasons why GE Rail Services and its newly launched intermodal business have done well despite the economic downturn.
Railroads see real economic benefit when they lease freight cars, most notably the specialized ones, rather than owning them. Leasing is really our specialty. It's the basic tool we use to help the railroads further increase their efficiency.
Groomes said since he was appointed CEO of GE Rail Services four months ago, he has spent most of his time touring and inspecting the North American Class I railroads, as well as several of the short lines that act as feeders to the major carriers. The total-immersion familiarization has been a humbling, yet exciting, experience to a non- railroader, he says, but it also has yielded him fresh insights that GE Rail Services can turn into value for the carriers and shippers who lease its rolling stock.
Known for his positive energy, eagerness to learn and can-do attitude, Groomes observes, The rail industry is becoming increasingly sophisticated and professional in everything it does, and as a supplier, we must do the same.
Our mission at GE Rail Services is to get close to our customers so we can understand their needs and use the core competencies of GE to develop effective solutions.
Groomes said GE's quantitative skills, and particularly its widely respected Six Sigma process for raising product and service quality while cutting costs, are appropriate for GE Rail Services and its customers at this time.
Our core competency at GE Rail Services historically has been leasing railcars and maintaining them, Groomes said. But today we can offer our customers more by drawing on skills that have been developed in other parts of the GE organization.
GE has resources and experience that have not been a part of traditional railcar management but can add substantial value to our customers' operations. GE would like to leverage some of those resources to help contribute to the growth of the rail industry.
GE has been vigilant about weaving Six Sigma quality processes into its core business practices, and the Railcar Services unit is a prime candidate for fresh and creative applications of the Six Sigma principles.
The process already has begun in our car repair shops, Groomes said. We are reducing the amount of quality variation and the amount of time a car is out of service.
Groomes says process orientation was ingrained in him while he worked toward the BS in Metallurgical Engineering that Brown University awarded him in 1982. He later earned an MS in Materials Science from Carnegie-Mellon University, which led to his joining GE Plastics in 1988.
About GE Rail Services
A unit of the General Electric Company (NYSE:GE), GE Rail Services, headquartered in Chicago, Illinois, leases 185,000 railroad cars-including coal hoppers, grain hoppers, refrigerator cars that carry fresh produce and frozen foods, tank cars for petroleum and chemicals, gondola cars for hauling steel and other industrial products, and intermodal flat cars that carry highway semi-trailers and intermodal containers.
Additionally, the company's TIP Intermodal unit leases 150,000 semi-trailers and containers to shippers and railroads.
For further information, visit us at gerail.com.
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CONTACT: GE Rail Services
Linda Bartman, 312/853-5557
[email protected]