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Domestic Manufacturing Revival Sparks Growth for CSX’s Industrial Network

As the U.S. government doubles down on reshoring critical manufacturing, CSX CEO Joe Hinrichs says the freight railroad giant is seeing a significant uptick in industrial development tied directly to this policy shift. In a recent interview with CNBC’s Jim Cramer, Hinrichs described how federal incentives and trade policy changes are reshaping the industrial landscape—and boosting CSX’s bottom line in the process.

More Than 600 Industrial Projects on Track

“By the end of last year, we were working on around 500 industrial projects with companies looking to build on or near our rail network. That number has grown to 600,” Hinrichs said. “Already this year, 37 new plants have gone live on our network, and more are in the pipeline.”

These developments range from automotive and chemical facilities to energy, steel, and consumer goods plants—many of which are returning from overseas locations due to new tariffs and domestic manufacturing incentives under recent federal legislation like the CHIPS and Science Act and the Inflation Reduction Act.

CSX, which covers a 20,000-mile network across 23 states primarily along the Eastern U.S., plays a crucial role in supporting these industrial expansions by helping businesses develop “rail-served” facilities. Hinrichs emphasized that as manufacturing shifts back onshore, “rail becomes the backbone of national logistics.”

Tariffs and Trade Policy: Limited China Exposure, But Strategic Impact

Though CSX’s direct exposure to Chinese goods accounts for less than 10% of its total revenue, the CEO acknowledged that ongoing trade tensions still influence freight flows.

“A significant amount of imported goods from China come into West Coast ports and are moved inland through our network—to places like Memphis, Chicago, and the Southeast,” he explained. “Since about two-thirds of the U.S. population lives east of the Mississippi, our positioning puts us in a strong spot logistically.”

Weather Challenges Still Linger from Hurricane Helene

Despite the industrial growth, Hinrichs also addressed setbacks stemming from extreme weather. Hurricane Helene, which struck the Southeastern U.S. last year, inflicted serious damage on CSX infrastructure—particularly in North Carolina and Florida.

“We lost about 25% of our north-south network due to that storm,” he said. “The recovery has been slower than we’d like, but we expect full restoration by Q4 this year. Operations are improving, and we’re optimistic about our overall momentum.”

Government Incentives Driving Rail Renaissance

Hinrichs noted that federal policies designed to incentivize domestic production are catalyzing a long-term shift that benefits not just CSX, but the broader U.S. supply chain.

“These policies are changing how and where companies decide to build,” he said. “We’re seeing firms prioritize rail-accessible sites to reduce transportation costs and carbon emissions. It’s a win for the economy and a win for sustainability.”

Industry-Wide Outlook

According to the Association of American Railroads, rail intermodal volume—a key measure of goods movement across trucking and trains—has steadily risen in 2024. And with industrial construction spending surpassing $200 billion annually, the demand for reliable freight logistics continues to rise.

“America’s industrial base is evolving,” Hinrichs concluded. “And CSX is ready to power that transformation, one mile of track at a time.”