Kansas City Southern (company)


Headquartered in Kansas City, Missouri, Kansas City Southern is a transportation holding company with railroad investments in the United States, Mexico and Panama.
The KCS rail network includes about 6,700 route miles in the U.S. and Mexico.
KCS' primary U.S. holding, The Kansas City Southern Railway, a Class I railroad that operates about 3,400 route miles in 10 states in the midwestern and southeastern United States. KCS's major hubs include Kansas City, Missouri, Shreveport, Louisiana, New Orleans, Dallas and Houston. Among the Class I railroads, KCS has the shortest route between Kansas City, the second-largest rail hub in the country, and the Gulf of Mexico.
KCS' primary international holding is Kansas City Southern de México, which operates about 3,300 route miles in 15 states in northeastern, central, southeast-central and southwest-central Mexico. KCSM reaches the Gulf of Mexico ports of Tampico, Altamira, and Veracruz, and the Pacific Ocean deepwater container port of Lázaro Cárdenas. KCS obtained 100% of ownership of KCSM in 2005, making KCS the only Class I Railroad to own track in Mexico's.
KCS international holdings also include a 50% interest in Panama Canal Railway Company, which operates the Panama Canal Railway. providing ocean-to-ocean freight and passenger service along the Panama Canal. PCRC provides ocean-to-ocean transshipment service between the Atlantic and Pacific oceans. The railroad serves as an intermodal line for world commerce and complements the existing transportation infrastructure provided by the Canal, the Colón Free Trade Zone and the Pacific and Atlantic ports. PCRC's wholly owned subsidiary, Panarail Tourism, offers passenger service for business commuters, tourists and private charters.
Patrick J. Ottensmeyer was named President in April 2015 and CEO in June 2016, succeeding David Starling. Ottensmeyer had served as Executive Vice President of Sales and Marketing and Chief Financial Officer. He was named Railroader of the Year by Railway Age for 2020.

History

In 1887, Arthur Edward Stilwell and Edward L. Martin began construction on and incorporated the Kansas City Suburban Belt Railway in suburban Kansas City, Missouri. Beginning operations in 1890, the railroad served the Argentine District in Kansas City, Kansas; Independence, Missouri; and the riverside commercial and industrial districts of Kansas City.
While the Belt Railway was a success, Stilwell had a much bigger dream. Over the ensuing decade, the line grew through construction and acquisition of other roads, such as the Texarkana and Fort Smith Railway, to become a through route between Kansas City and Port Arthur, Texas. With the final spike being driven north of Beaumont, Texas, on September 11, 1897, the Kansas City, Pittsburg and Gulf Railroad Company was completed. In 1900, KCP&G became The Kansas City Southern Railway Company. In 1939, KCS acquired the Louisiana and Arkansas Railway, providing a route extending from Dallas to New Orleans, via Shreveport, Louisiana.
In 1962, under the name Kansas City Southern Industries, Inc., the company was formally organized as it began to diversify its interests into other industries under the CEO William Deramus III. The new KCSI focused primarily on the financial industry, along with the rail industry. In 1969, KCSI started the two largest companies that came out of the diversification: DST Systems and Janus Capital Group, which was known as Stilwell Financial at the time. DST Systems is a software development firm that specializes in information processing and management, with the goal of improving efficiency, productivity, and customer service. Janus Capital Group is a finance firm that provides growth and risk-managed investment strategies.
The core KCSI rail system changed little until the 1990s, when the purchase of MidSouth Rail extended KCSI's reach east from Shreveport into Mississippi and Alabama. Combined with existing KCSI routes, this created an east-west mainline marketed as the Meridian Speedway. Another acquisition, the Gateway Western Railway, extended KCS's reach from Kansas City to St. Louis, Missouri, and Springfield, Illinois.
The 1990s also saw KCSI expand into Mexico with the acquisition of partial interests in the Texas Mexican Railway and Grupo Transportación Ferroviaria Mexicana. TFM was created when KCSI and Transportacion Maritima Mexicana purchased a government concession to operate a rail system in Mexico. The concession was also bid on by many other major companies, including the United States' largest railroad, Union Pacific Railroad. KCSI and TMM bid on, and won, the concession for $1.4 billion USD, paying 49% and 51%, respectively. TMM already partially owned the Texas Mexican Railway through a previous concession from the Mexican government. TM was particularly important to KCSI because they held the link from KCSI tracks to TFM tracks via trackage rights over the Union Pacific line.
Shortly after acquiring the Mexican government's concession, KCSI entered into another joint venture to purchase a government concession. On June 19, 1998, the government of Panama turned over control of the Panama Canal Railway to Kansas City Southern Railroad and the privately held Lanigan Holdings, LLC. This created the Panama Canal Railway Company.
After these large capital outputs, KCSI needed new money to improve the Mexican and Panamanian concessions they had purchased, and to continue to make capital expenditures in the future. To fund these efforts, KCSI spun off all assets that were not essential to the rail businesses. Doing this essentially paid off the purchase of their two existing concessions and freed up money to improve them. The first major improvement that took place was in 2000 and 2001 when the PCRC upgraded the railway to handle large, intermodal shipping containers, along with passenger transport.
In 2002, the Kansas City Southern Industries formally changed its name to Kansas City Southern after spinning off many subsidiary businesses that were not directly related to the railroad business. In 2005, Kansas City Southern purchased TMM's share in TFM and TM, giving them full ownership of the companies. TFM was officially renamed Kansas City Southern de México, S.A. de C.V. The Texas Mexican Railway retained its original name and is a subsidiary of KCS.
In June 2009, the Kansas City Southern began operating on new trackage between Victoria and Rosenberg, Texas, known as the Macaroni Line

Subsidiaries

In addition to KCS, KCSM and PCRC, Kansas City Southern’s subsidiaries include:
The country rock band Pure Prairie League has a song on their 1975 album Two Lane Highway titled "Kansas City Southern."
Gene Clark wrote a song "Kansas City Southern" for his 1977 LP Two Sides To Every Story.
The country group Turnpike Troubadours has a song titled Kansas City Southern.

Company officers

The following is a list of the executives heading KCS since 1889.