CSX Inks $670M Deal With Wabtec to Expand Fleet Modernization

CSX Corporation CSX has inked a $670-million deal with Westinghouse Air Brake Technologies WAB, operating as Wabtec, marking a decisive step toward fleet modernization and stronger network performance. Per the deal, CSX will acquire 100 new Evolution Series locomotives, modernize 50 existing units and integrate advanced digital solutions to enhance operational efficiency and reliability.

CSX will use the new Evolution Series locomotives to improve fuel efficiency, tractive effort and overall reliability, particularly in long-haul and heavy-haul operations. By reducing fuel consumption while maintaining performance, the company aims to control operating costs and improve service consistency across its network.

The company will also convert aging D9 locomotives from DC to AC traction, extending their service life and improving fleet standardization. These upgrades will enable CSX to deploy advanced control and diagnostic technologies that support stronger fuel performance and operational productivity.

In addition, CSX will equip both new and modernized locomotives with Trip Optimizer and Smart Horsepower per Ton, an EPA-certified system designed to optimize fuel usage. With deliveries beginning this year and modernization rolling out in 2027, CSX is actively strengthening its fleet strategy to support long-term growth and efficiency gains.

Share Price Performance of CSX

CSX’s shares have gained 24.3% over the past year compared with the Transportation - Rail industry’s 8.4% rise.

CSX’s Zacks Rank

CSX currently has a Zacks Rank #4 (Sell).

Stocks to Consider

Investors interested in the Zacks Transportation sector may consider LATAM Airlines Group LTM and Southwest Airlines LUV.

LTM currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

LTM has an expected earnings growth rate of 22.42% for the current year.  The company has an encouraging earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters, and met the mark once, delivering an average beat of 36.13%.

Southwest Airlines currently carries a Zacks Rank #2 (Buy).

LUV has an expected earnings growth rate of 344.1% for the current year. The company has an encouraging earnings surprise history. Its earnings topped the Zacks Consensus Estimate in three of the trailing four quarters, and missed the mark once, delivering an average beat of 253.9%.

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This article originally published on Zacks Investment Research (zacks.com).

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