# Watco

Watco Companies, L.L.C. (Watco) Watco is an American transportation and logistics company based in Pittsburg, Kansas. The company’s core services are freight transportation, material handling and storage, logistics, railcar repair and maintenance.
Watco owns and/or operates 45 short line railroads in North America and Australia, with more than 8,000 miles (13,000 km) of track connecting to Class I railroads. It is one of the largest short line owner-operators in the U.S. The company also operates, and in many cases owns, over 70 transload and marine terminals, and a handful of terminals that specialize in the repair and maintenance of railcars and locomotives.
Watco has about 4,800 employees, led by Chief Executive Officer Dan Smith. The company earned $1.6 billion in revenues in 2022.
In 2023, the company was certified by Best Practice Institute (BPI) for the second year in a row as a Most Loved Workplace. In 2022, in collaboration with BPI, Newsweek named Watco to its annual list of America’s Top 100 Most Loved Workplaces. Watco was also named a 2023 Newsweek Top 100 Global Most Loved Workplace®.

## History

Watco was established in 1983 by Charles R. "Dick" Webb. The first operation was an industrial switching operation in DeRidder, Louisiana that is still in existence. Webb then started his first mechanical operation, a railcar repair shop in Coffeyville, Kansas in 1985.
The Coffeyville mechanical shop was held captive to the major rail lines, and during discussions with the Union Pacific the opportunity arose to purchase the line running from Nevada, Missouri, to Coffeyville. This was the Union Pacific's first short-line sale. Watco then looked to the West Region, acquiring the Blue Mountain Railroad in 1998, the Palouse River and Coulee City Railroad in 1992 and the Eastern Idaho Railroad in 1993.
In 1998, it began operating the Stillwater Central Railroad in Oklahoma and the Timber Rock Railroad in Texas. The Kansas & Oklahoma Railroad was acquired in 2001 and the Pennsylvania Southwestern Railroad in 2003. In 2004, they started operations of the Great Northwest Railroad in Washington, the Kaw River in Kansas and Missouri, and the Mission Mountain Railroad in Montana. In 2005 it began operating the Alabama Southern Railroad, the Louisiana Southern Railroad, the Mississippi Southern Railroad, and the Yellowstone Valley Railroad in Montana. The Austin Western Railroad was started in 2007 and shares rail with passenger rail. It also acquired Millennium Rail, a mechanical service company in 2007. The Baton Rouge Southern and the Pacific Sun Railroad were started in 2008, and they also acquired the mechanical services company Fitzgerald Railcar Services and Reload, a 25-year experienced transloading business. The Grand Elk Railroad began operations in 2009.
In December 2010 Watco entered the Australian rail haulage market when it was awarded a 10-year contract to operate grain services for the CBH Group of Western Australia. Operations commenced in March 2012. In late 2016 Watco Australia was awarded an infrastructure train contract with Brookfield Rail operating ballast and rail work trains.
On December 15, 2010, Kinder Morgan Energy Partners, announced an agreement whereby it would invest up to $150 million over the next year in Watco in exchange for a preferred equity position in the company. Kinder Morgan made an initial $50 million preferred shares investment on January 3, 2011. Additional $50 million equity investment completed in December 2011. Kinder Morgan will receive 3.25% quarterly distribution on the equity investment. Kinder Morgan is a leading pipeline transportation and energy storage company in North America. The transaction provides capital to Watco for further expansion of specific projects and offers Kinder Morgan the opportunity to share in the subsequent growth.
In April 2011, Watco began operating the Autauga Northern Railroad, between Maplesville and Autauga Creek, Alabama, the third short line in Alabama operated by Watco.
On December 28, 2011, Watco began operations of the Swan Ranch Railroad in the Swan Ranch Industrial Park in Cheyenne, Wyoming. On January 1, 2012, Watco gained majority ownership of the Wisconsin & Southern Railroad, a regional railroad in Wisconsin, and on February 1, 2012, took over operations of the Birmingham Southern Railroad.
On June 4, 2014, Watco and The Greenbrier Companies announced that it would create an equally owned joint venture, GBW Railcar Services, providing railcar repair services. This joint venture was dissolved in August 2018.
In July 2018, Dan Smith was named Watco's new CEO.
On March 30, 2021, Watco and Canadian National subsidiary Wisconsin Central reached a deal whereby WCL would sell roughly 900 miles of non-core rail lines located in Michigan, Wisconsin, and Ontario to Watco.
In January 2022, Watco takes over operations to move cattle in Queensland CBH Group to Aurizon.

## Holdings

| Railroad | Began operations | Track length (mi.) | Commodities | Facts |
| Agawa Canyon Railroad (ACR) | February 2022 | 289.96 | materials for the metals and forest products industries | Southern segment of the former Algoma Central Railway, acquired from Canadian National |
| Alabama Southern Railroad (ABS) | November 2005 | 97.4 | iron and steel, paper products, aggregates | Acquired through lease agreement with KCS |
| Alabama Warrior Railway (ABWR) | August 2009 | 2 | coal, aggregates, pipe, scrap steel, cement | Started as Marylee Railroad in 1895 |
| Ann Arbor Railroad (AA) | January 2013 | 91.6 | automotive materials | Purchased from Ann Arbor Acquisition Corp, services mostly Chrysler plant producing Jeep Cherokees |
| Arkansas Southern Railroad (ARS) | October 2005 | 83 | corn and soybean products | Two branches, 32-mile northern branch and a 30-mile southern branch |
| Austin Western Railroad (AWRR) | October 2007 | 204 | aggregates, crushed limestone, calcium bicarbonate, lumber, beer, chemicals, plastic, paper | Shares rail with commuter operations in Austin, Texas |
| Autauga Northern Railroad (AUT) | April 2011 | 68.2 | paper products and aggregates | Third Watco Alabama short line |
| Baton Rouge Southern Railroad (BRS) | November 2008 | 43 | chemicals, bauxite, plastic pellets, raw coke, calcinated coke | Provides car storage and use by local chemical companies |
| Birmingham Terminal Railway (BHRR) | February 2012 | 178.3 | iron ore, coal, steel sheets and pipe | Provides rail service to Port Birmingham |
| Blue Ridge Southern Railroad (BLU) | July 2014 | 104.8 | woodchips, chemicals, paper, cement | Former Norfolk Southern T-Line (Murphy Branch), W-Line, and TR-line. Based in Canton, NC. |
| Boise Valley Railroad (BVRR) | November 2009 | 100 | frozen vegetables, lumber, fertilizer, fuels | Shares customers with the YSVR and EIRR |
| Cicero Central Railroad (CERR) | 2015 | 1.09 | pitch and other chemicals to create plastics. | Serves the Koppers Stickney Plant |
| Decatur & Eastern Illinois Railroad (DREI) | September 2018 | 239.5 | chemicals, plastics, soybeans, and corn | Operates on ex-CSX Transportation trackage acquired in 2018 and ex-Eastern Illinois Railroad trackage acquired in 2019 |
| Dutchtown Southern Railroad (DUSR) | 2021 | 41.1 | products for the chemical, gas, and energy industries | operates on trackage leased from Canadian National |
| Eastern Idaho Railroad (EIRR) | 1993 | 391.8 | corn, sugar, wheat, frozen vegetables, coal | Largest Union Pacific sale |
| Fox Valley and Lake Superior (FOXY) | January 2022 | 609.8 | metals, forest products, building materials, chemicals, propane, and fuel | Former Canadian National lines; major interchanges are in Appleton, Green Bay, Spencer, and Wausau |
| Ithaca Central Railroad (ITHR) | December 8, 2018 | 56.2 | salt, plastics, magnesium chloride | Leased from Norfolk Southern |
| Geaux Geaux Railroad(GOGR) | December 2018 | 39.21 | paper products | primary customer in paper industry |
| Grand Elk Railroad (GDLK) | March 2009 | 329.2 | lumber products, corn, steel | Interchanges with 3 Class I railroads |
| Great Northwest Railroad (GRNW) | March 2004 | 286 | lumber, products, fertilizers, aggregates | Competition to reach Lewiston while the line was being built was called the "Clearwater River Railroad Wars" |
| Kanawha River Railroad (KNWA) | July 2016 | 384.8 | Chemicals, Aggregates, Agricultural Products | Second railroad to be acquired by Watco in the state of West Virginia. Appalachian & Ohio was briefly operated by Watco Transportation Services. Operates on former Norfolk Southern tracks in Ohio and West Virginia. |
| Kansas & Oklahoma Railroad (KO) | July 2001 | 974.4 | wheat, grain products, chemicals, soybean products | Has state and federal shipping agreements |
| Kaw River Railroad (KAW) | June 2004 | 23.6 | iron and steel, corn starch, lumber products, aggregates, plastics, industrial products | Expansions in 2005, 2006, and 2007 |
| Louisiana Southern Railroad (LAS) | September 2005 | 217.1 | paper products, aggregates, oils | Interchanges at Gibsland, Sibley, and Pineville |
| Mission Mountain Railroad (MMT) | December 2004 | 26 | lumber, wheat | Runs from Stryker to Eureka, served by the BNSF |
| Mississippi Southern Railroad (MSR) | April 2005 | 191.1 | corn and soybeans | Interchanges with KCS at Newton |
| Palouse River & Coulee City Railroad (PCC) | 1992 | 307.8 | wheat, frozen vegetables | $25 million in state-sponsored track rehabilitation backed by 100-year lease |
| Pennsylvania Southwestern Railroad (PSWR) | April 2003 | 14.6 | steel scrap, steel products | First Watco operation to service a steel mill |
| Pecos Valley Southern Railway (PVSR) | 2012 | 44.6 | sand, gravel, crude oil | Formerly operated by Capitol Aggregates |
| San Antonio Central Railway (SAC) | 2012 | 8.6 | Warehousing, distribution, and transloading | Operates within Port San Antonio's East Kelly Railport at night |
| Savannah and Old Fort Railroad (SVHO) | 2019 | 6.5 | Sulfuric acid, sulfur, gypsum, pulpboard, wood pellets, and petroleum | Interchanges with CSX. Located in Savannah, Georgia. |
| Stillwater Central Railroad (SLWC) | 1998 | 399.9 | crude oil, sand, gypsum, cement, stone, steel | Serves on two branches: Pawnee to Stillwater and Tulsa to Duke |
| South Kansas & Oklahoma Railroad (SKOL) | March 1987 | 730.3 | grains, cement, coal, fertilizer, aggregates, steel, sand | Operates out of the historic Cherryvale, Kansas depot and serves the Port of Catoosa at Tulsa, Oklahoma |
| Swan Ranch Railroad (SRRR) | December 2011 | 21 | asphalt | The SRRR serves the Swan Ranch Industrial Park |
| Timber Rock Railroad (TIBR) | 1998 | 62.12 | aggregates, lumber products, plastics, fuel | Reduced to the single line running from Kirbyville, Texas to DeRidder, Louisiana. |
| Vicksburg Southern Railroad (VSOR) | January 2006 | 48.25 | lumber, steel | Delivers to the Port of Vicksburg |
| Watco Australia | May 2012 | NA - operator only | grain | First international operation of Watco, providing service in Western Australia and Queensland |
| Wisconsin & Southern Railroad (WSOR) | January 2012 | 808.5 | lumber, coal, liquid and dry fertilizers, corn, beans, plastic, aggregates, ethanol, liquid petroleum | Wisconsin's second-largest railroad |
| Yellowstone Valley Railroad (YSVR) | August 2005 | 4.3 | grains, plastics, ethanol, crude oil, sand | Provides service to the Dore Transload Terminal and interchanges with the BNSF |