AUGUST 21, 2017 STB UPDATE

AUGUST 21, 2017 STB UPDATE

Executive Summary Network metrics stable; plan adjustments implemented to enable near-term progression Dwell and velocity continue modest gains; fluidity meaningfully improved over last two weeks Focus on road train origination and arrival metrics not primary in precision scheduled railroading 1 Crew and power resource levels are well matched to demand Additional engines brought in service to meet coal demand; coal velocity improved vs. 2016 Five hump yards, down from 12, scaling up well with efficiency and performance progression Avon hump re-introduced last week; smooth transition occurred Western Network improving, with terminals fluid, and customer service on site at key field locations Train plan tweaked to mitigate secondary congestion; focus on empty car fulfillment processes Number of customer problem logs remains elevated as performance coming back into balance Interchange volumes stable; active communication to maintain performance CSX experienced congestion challenges at Western corridor terminals from mid-late July (weeks -); network recovery underway and expected to progress this week 2 1 E.g., holding a train s origination to allow additional cars to reach a customer on time (end destination) would hinder train origination and arrival metrics, but provide better service to the customer

11.3 11.4 13.8 13.5 13 12.7 11.6 12.9 13.0 13.6 13.1 13.6 12.5 13.1 67% 53% 54% 60% 57% 55% 58% 50% 76% 73% 72% 70% 64% 67% Network measures improving modestly from height of challenges On Time Originations (%) Weekly Average On Time Arrivals (%) 86% 87% 85% 82% 77% 74% 72% 72% 75% 76% 70% 66% 58% 59% 55% 57% On-Time +2 hrs On-Time +2 hrs Dwell (hours) Velocity (mph) 11.8 11.9 12.3 11.9 12.8 13.2 13.1 12.8 15.6 15.5 15.0 15.0 13.5 13.3 13.0 13.2 Two disruptive derailments occurred in weeks and, detrimentally impacting network performance 3 Note: Dwell and velocity displayed according to revised CSX methodology; explanation of CSX methodology and comparable view in AAR methodology can be found in appendix.

65% 70% 69% 71% 74% 76% 75% Right Car Right Train holding relatively stable; less relevant in PSR Right Car Right Train 1 Weekly Average Right Car Right Train is no longer a measure that CSX uses to manage its operation 75% 73% 73% 75% 73% 72% 71% 70% In precision scheduled railroading (PSR), if a car can be advanced on another train to speed transit or ensure its on-time arrival, there is not one right train Car priority is to move cars quickly, on next available train Asset utilization a key tenet of PSR Train priority is blocking integrity and departing all available, relevant cars from the yard Blocking integrity certifies that a train is built correctly and shipments are headed to the correct location Managed through field supervision 4 1 Right Car Right Train is defined as the percentage of cars that departed from a yard in accordance with their car scheduling trip plan

Resourcing appropriately to meet business needs 4,000 3,600 3,200 2,800 2,400 2,000 3,763 Q1 AVG Q2 AVG Active Locomotives Q3 locomotive level stable; recently added engines in response to incremental coal demand 3,5 33 9,900 9,700 9,500 9,0 9,100 8,900 Train & Engine Headcount and Re-crew Rate 1 9,223 Q1 AVG Q2 AVG 9,391 33 10.0% 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% T&E trend tracking normal seasonality; re-crew rates remain at historic lows, down (18%) vs. 2016 Power and crew availability steady in third quarter at 99% and 95%, respectively 5 1 Re-crew rate is re-crew people starts as a percent of total measured people starts, and it represents incidences of replacing a crew on the same train ID (generally due to hours of service)

17.1 17.0 16.7 19.7 19.3 18.6 18.5 Hump yard performance steady through transitions; efficiency building CSX Hump Terminal Overview Transitioned to flat-switching operations Hump terminals Toledo, OH Avon, IN Louisville, KY Nashville, TN Birmingham, AL Selkirk, NY Willard, OH Cumberland, MD Cincinnati, OH Hamlet, NC Atlanta, GA Waycross, GA Avon hump operations resumed last week, supporting service and prevention of secondary congestion Key hump productivity and efficiency measures performing well Arrive-to-hump, a measure of fluidity and processing efficiency, has improved by 8% in the last week vs. prior Cars per man hour at hump yards up 4% since the start of Q3, indicating yard productivity with higher volume at remaining humps Dwell time stable and compressing slightly 19.5 19.0 20.0 Dwell at Hump Terminals 1, 2 Weekly Average 18.0 18.8 19.3 19.0 19.9 Absolute number of humps not good or bad ; goal is best mix of hump and flat yards for processing efficiency August 12 18 6 1 Dwell displayed according to CSX methodology; explanation of CSX methodology and comparable view in AAR methodology can be found in appendix 2 Week 33 dwell data excludes Avon due to transition from flat to hump

11.0 12.2 11.7 11.3 16.9 16.4 18.3 Western performance improving; plan changes alleviating congestion Western Corridor Key Terminals Avon, IN Evansville, IN Nashville, TN Birmingham, AL Montgomery, AL Key terminal productivity and performance measures significantly improved in former trouble spots On-time originations improved more than 100% since period of greatest concern, to above system levels in week 33 Dwell down significantly, and much more in line with expectations Greater yard productivity evident in cars per man-hour processed Train plan tweaked to prevent secondary congestion 16.0 Leveraging Avon as near-term offset of increased volume flow through Russell, Columbus and Louisville; fluidity improving daily 16.9 16.8 17.3 Dwell at Western Terminals 1, 2 19.9 22.1 Weekly Average 19.5 16.0 Mobile, AL Western terminals Wk Wk Wk Wk Wk Wk Wk Wk August 12 18 7 1 Dwell displayed according to CSX methodology; explanation of CSX methodology and comparable view in AAR methodology can be found in appendix 2 Week 33 dwell data excludes Avon due to transition from flat to hump

Car order fill to improve with reduced dwell Cars Ordered 7,000 6,000 5,000 4,000 3,000 2,000 Weekly Car Orders and Normalized Fill Rate 33 Week Weekly Orders Normalized Order Fill % Normalized Fill Rate 90% 85% 80% 75% 70% 65% 60% 55% 50% Q1 Avg. Weekly Car Orders Customer car orders up ~40% in Q3 vs. Q1 2017 Merchandise carload expectations down slightly in comparable timeframe Order levels have disconnected with demand Absolute orders filled are down with network challenges Network improvement to drive additional orders filled as empty dwell, and overall dwell, are reduced Car storage paused to address; CSX fleet sized to capture demand in a recovering environment Normalized fill rate 1 ranging 70-85% Process evaluation underway to realign order level with demand and improve fulfillment accountability 8 1 Normalized fill rate is a proxy of demand fulfillment against historical/expected order levels, as current order levels have disconnected with demand

Last mile performance stable 95% 90% 84% 83% Local Service Measurement 1 80% 81% 81% 80% 79% 78% 83% Local Service Measurement (LSM) is no longer a metric that CSX uses to manage its operation In precision scheduled railroading (PSR), focus on endto-end transit and customer expectations Last mile performance must be in combination with, not independent of, overall performance Accordingly, LSM as a reported metric was discontinued upon start of PSR implementation At request of STB, last mile tracking reinstated to monitor through implementation period Data reflects passive information flow, lacking prior focus on field reporting to ensure LSM capture Q1 AVG Q2 AVG 33 Reliable pull and place expected as part of service to customers 9 1 Local Service Measurement is defined as the percentage of cars that were pulled or placed at a customer location based upon daily customer request, the local service plan and available inventory at the local serving yard

Customer inquiries, problem logs elevated; action plans being executed Customer Inquiries Daily Average Log Volume Delayed cars have been most frequent concern Trend in problem logs mirrors timeframe of network challenges 458 570 563 537 567 Overall dwell falling and enhanced focus on long-dwell cars to ensure all cars benefit from fluidity gains 354 368 6 374 Customer service and commercial presence at key field location has aided communication and problem resolution New location assignments this week include: Columbus, Russell, Avon, Memphis 33 Delayed Cars Bad Order Switching Issues Nearly 90% of problem logs have been addressed and closed to-date Managing pipeline of customer concerns to full resolution 10

33 33 33 33 Interchange volume up slightly at gateway locations 800 600 400 200 East St. Louis Daily Average Interchange Volume From To 1,600 1,200 800 400 Chicago Daily Average Interchange Volume 0 0 600 New Orleans Daily Average Interchange Volume 0 Memphis Daily Average Interchange Volume 400 200 200 100 0 0

Precision scheduled railroading to produce service improvement Operational Focus Service Improvements & Productivity Improvements Balanced Train Plan Improved Frequency Better Reliability Rolling Stock Utilization People Efficiency Terminal Fluidity Faster Transit Quicker Turnaround Fuel Optimization Train Density Improve Service Operate Safely Control Costs Drive Asset Utilization Develop People Realigned service frequency in second quarter Set the groundwork of a balanced train plan in early July Currently balancing between terminals improving efficiency and modest adjustments in traffic flows to recover near-term service Improved execution on this foundation to drive long-term service and productivity improvements 12

APPENDIX

CSX has changed methodology on some metrics reported publicly Velocity Dwell Cars Online Former Line of road miles per hour Former Car time at terminal, excluding cars on the same train ID Former All cars on CSX, as determined by RailInc Future Total miles traveled per hour, including intermediate dwell of the train Future All car time with a terminal work event, including through cars on same train ID (e.g. crew change) Future RailInc cars on CSX, excluding cars stored, under repair, sold, and private cars ex online inventory Change Reason Includes full trip of a train and ability to diagnose overall speed profile (in support of improvement in asset cycle) Change Reason Includes all dwell with ability to diagnose all events impacting car movement (in support of improvement in asset cycle) Change Reason More accurate measurement of active cars on line, i.e. cars for which CSX is focused on realtime, efficient movement Effect on Metric Reported velocity will be lower Effect on Metric Reported dwell will be lower Effect on Metric Reported cars online will be lower Restated historical data in new methodology to be available on csx.com 14

While absolute value of metrics has changed, trend remains consistent Average Velocity (mph) Average Dwell (hours) 18 2017 Velocity 2016 Velocity 18 2017 Dwell 2016 Dwell 16 16 14 14 12 12 10 10 8 8 6 Q1 Q2 Q3-to-date 6 Q1 Q2 Q3-to-date Restated historical data in new methodology to be available on csx.com 15

16 The following pages include applicable presentation material using prior methodology for comparability during metrics methodology cutover

19.3 18.9 18.7 19.1 18.7 17.9 17.4.7.2.2.8.2.3 67% 76% 73% 72% 70% 64% 53% 67% 54% 60% 57% 55% 58% 50% Network measures improving modestly from height of challenges On Time Originations (%) On Time Arrivals (%) Weekly Average 86% 87% 85% 82% 77% 74% 72% 72% 75%76% 70%66%58% 59% 55%57% On-Time +2 hrs On-Time +2 hrs Dwell (hours) Velocity (mph).3.6.7.4.0.2.4.3 21.2 21.3 20.6 20.4 19.2 18.7 18.7 18.4 Two disruptive derailments occurred in weeks and, detrimentally impacting network performance 17 Note: Dwell and velocity displayed according to AAR methodology

.6.1.3.4.7.5.9 Hump yard performance steady through transitions; efficiency building CSX Hump Terminals Transitioned to flat-switching operations Hump terminals Toledo, OH Avon, IN Louisville, KY Nashville, TN Birmingham, AL Selkirk, NY Willard, OH Cumberland, MD Cincinnati, OH Hamlet, NC Atlanta, GA Waycross, GA Avon hump operations resumed last week, supporting service and prevention of secondary congestion Key hump productivity and efficiency measures performing well Arrive-to-hump, a measure of fluidity and processing efficiency, has improved by 8% in the last week vs. prior Cars per man hour at hump yards up 4% since the start of Q3, indicating yard productivity with higher volume at remaining humps Dwell time stable and compressing slightly.0.0.2.6.5 Dwell 1,2.6 Weekly Average.6.5 Absolute number of humps not good or bad ; rather, a different configuration of handling traffic August 12 18 18 1 Dwell displayed according to AAR methodology 2 Week 33 dwell data excludes Avon due to transition from flat to hump

.2.4 33.4 37.5 33.7.0 37.4 Western performance improving; plan changes alleviating congestion Western Corridor Key Terminals Avon, IN Evansville, IN Nashville, TN Key terminal productivity and performance measures significantly improved in former trouble spots On-time originations improved more than 100% since period of greatest concern, to above system levels in week 33 Dwell down significantly, and much more in line with expectations Greater yard productivity evident in cars per man-hour processed Train plan tweaked to prevent secondary congestion Leveraging Avon as near-term offset of increased volume flow through Russell, Columbus and Louisville; fluidity improving daily Dwell 1,2 Weekly Average Birmingham, AL Montgomery, AL Mobile, AL 36.0 37.4 36.9 38.0 45.6 51.7 52.6 41.4 Western terminals Wk Wk Wk Wk Wk Wk Wk Wk 19 1 Dwell displayed according to AAR methodology 2 Week 33 dwell data excludes Avon due to transition from flat to hump