The Executive Chairman of the Fort Worth-based BNSF Railway announced Thursday that roughly 4,600 employees will face furloughs and buyouts amid reduced demand for domestic energy sources and renewed political pressure to clamp down on domestic fossil fuel development.
The move will impact nearly 10 percent of its workforce.
BNSF Chairman Matthew Rose noted that similar employee cutbacks were made between 2007 and 2008 as the Great Recession began to be felt across the country, according to the Associated Press.
The cutback in railroad payrolls has acted as a natural consequence of a strengthened U.S. Dollar against the current petroleum production glut, slashing gas prices 75 percent since mid-2014, according to Reuters.
“We are in an energy depression, and industrial recession, and the consumer is doing just OK,” Rose told a Montana energy conference.
Annual volume figures for 2015 show the overall rail industry fell 3 percent as BNSF leadership remains bearish about future prospects.
Market watchers hoping for an upturn will likely not be encouraged by recent comments from Democrat Party frontrunner Hillary Clinton during a recent CNN townhall. When asked about future energy policies as president, the former Secretary of State offered an unambiguous position, noting that “we’re gonna put a lot of coal miners and coal companies out of business.”
Clinton’s promises to provide $30 billion in aid to former coal industry employees has yet to acknowledge the economic impacts that would be felt downstream for companies like BNSF and others.
Burlington Northern and Santa Fe Pacific Corporation merged in 1995 to better access western states’ coal mines and connect to international ports in Canada and Mexico, according to The New York Times. Deep into the Great Recession, Warren Buffett’s Berkshire Hathaway, Inc. acquired BNSF $26 billion in cash and stock, the largest deal in the investment vehicle’s history at the time.
The North Texas company operates in 28 states and three Canadian provinces, accounting for 32,500 route miles within its network, according to a recent fact sheet. In 2015 alone, BNSF hauled 2.3 million coal shipments, enough to power one in ten homes across the nation.
Logan Churchwell is a founding member of the Breitbart Texas team. You can follow him on Twitter @LCChurchwell.