Document_And_Entity_Informatio
Document And Entity Information | 9 Months Ended |
Sep. 30, 2013 | |
Document And Entity Information [Abstract] | |
Document Type | 10-Q |
Amendment Flag | FALSE |
Document Period End Date | 30-Sep-13 |
Entity Registrant Name | NORFOLK SOUTHERN CORP |
Entity Central Index Key | 702165 |
Current Fiscal Year End Date | -19 |
Document Fiscal Year Focus | 2013 |
Document Fiscal Period Focus | Q3 |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 308,910,328 |
Consolidated_Statements_Of_Inc
Consolidated Statements Of Income (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Consolidated Statements Of Income [Abstract] | ||||
Railway operating revenues | $2,824 | $2,693 | $8,364 | $8,356 |
Railway operating expenses: | ||||
Compensation and benefits | 735 | 724 | 2,241 | 2,234 |
Purchased services and rents | 420 | 403 | 1,223 | 1,186 |
Fuel | 390 | 379 | 1,210 | 1,182 |
Depreciation | 230 | 230 | 683 | 683 |
Materials and other | 200 | 226 | 631 | 661 |
Total railway operating expenses | 1,975 | 1,962 | 5,988 | 5,946 |
Income from railway operations | 849 | 731 | 2,376 | 2,410 |
Other income, net | 30 | 33 | 194 | 93 |
Interest expense on debt | 131 | 124 | 388 | 366 |
Income before income taxes | 748 | 640 | 2,182 | 2,137 |
Provision for income taxes | 266 | 238 | 785 | 801 |
Net income | $482 | $402 | $1,397 | $1,336 |
Per share amounts: | ||||
Basic | $1.55 | $1.26 | $4.45 | $4.12 |
Diluted | $1.53 | $1.24 | $4.40 | $4.07 |
Dividends | $0.52 | $0.50 | $1.52 | $1.44 |
Consolidated_Statements_Of_Com
Consolidated Statements Of Comprehensive Income (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Consolidated Statements Of Comprehensive Income [Abstract] | ||||
Net income | $482 | $402 | $1,397 | $1,336 |
Other comprehensive income, before tax: | ||||
Pension and other postretirement benefits | 38 | 33 | 110 | 97 |
Other comprehensive income (loss) of equity investees | 0 | 0 | 2 | -4 |
Other comprehensive income, before tax | 38 | 33 | 112 | 93 |
Income tax expense related to items of other comprehensive income | -15 | -13 | -43 | -38 |
Other comprehensive income, net of tax | 23 | 20 | 69 | 55 |
Total comprehensive income | $505 | $422 | $1,466 | $1,391 |
Consolidated_Balance_Sheets_Un
Consolidated Balance Sheets (Unaudited) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Assets | ||
Cash and cash equivalents | $984 | $653 |
Short-term investments | 20 | 15 |
Accounts receivable, net | 1,083 | 1,109 |
Materials and supplies | 224 | 216 |
Deferred income taxes | 149 | 167 |
Other current assets | 34 | 82 |
Total current assets | 2,494 | 2,242 |
Investments | 2,395 | 2,300 |
Properties less accumulated depreciation of $10,271 and $9,922, respectively | 26,413 | 25,736 |
Other assets | 63 | 64 |
Total assets | 31,365 | 30,342 |
Liabilities and stockholders' equity | ||
Accounts payable | 1,267 | 1,362 |
Short-term debt | 0 | 200 |
Income and other taxes | 241 | 206 |
Other current liabilities | 377 | 263 |
Current maturities of long-term debt | 447 | 50 |
Total current liabilities | 2,332 | 2,081 |
Long-term debt | 8,499 | 8,432 |
Other liabilities | 2,166 | 2,237 |
Deferred income taxes | 8,074 | 7,832 |
Total liabilities | 21,071 | 20,582 |
Stockholders' equity: | ||
Common stock $1.00 per share par value, 1,350,000,000 shares authorized; outstanding 308,910,328 and 314,034,174 shares, respectively, net of treasury shares | 310 | 315 |
Additional paid-in capital | 1,979 | 1,911 |
Accumulated other comprehensive loss | -1,040 | -1,109 |
Retained income | 9,045 | 8,643 |
Total stockholders' equity | 10,294 | 9,760 |
Total liabilities and stockholders' equity | $31,365 | $30,342 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (Unaudited) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, except Share data, unless otherwise specified | ||
Consolidated Balance Sheets [Abstract] | ||
Properties, accumulated depreciation | $10,271 | $9,922 |
Common stock, par or stated value per share | $1 | $1 |
Common stock, shares authorized | 1,350,000,000 | 1,350,000,000 |
Common stock, shares outstanding, net of treasury shares | 308,910,328 | 314,034,174 |
Consolidated_Statements_Of_Cas
Consolidated Statements Of Cash Flows (Unaudited) (USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Cash flows from operating activities | ||
Net income | $1,397 | $1,336 |
Reconciliation of net income to net cash provided by operating activities: | ||
Depreciation | 687 | 688 |
Deferred income taxes | 215 | 279 |
Gains and losses on properties and investments | -100 | -4 |
Changes in assets and liabilities affecting operations: | ||
Accounts receivable | 26 | -56 |
Materials and supplies | -8 | -27 |
Other current assets | 48 | 43 |
Current liabilities other than debt | 121 | 183 |
Other, net | 18 | 34 |
Net cash provided by operating activities | 2,404 | 2,476 |
Cash flows from investing activities | ||
Property additions | -1,470 | -1,522 |
Property sales and other transactions | 109 | 47 |
Investments, including short-term | -29 | -14 |
Investment sales and other transactions | 21 | 37 |
Net cash used in investing activities | -1,369 | -1,452 |
Cash flows from financing activities | ||
Dividends | -476 | -467 |
Common stock issued, net | 92 | 77 |
Purchase and retirement of common stock | -564 | -1,150 |
Proceeds from borrowings, net | 492 | 1,291 |
Debt repayments | -248 | -358 |
Net cash used in financing activities | -704 | -607 |
Net increase in cash and cash equivalents | 331 | 417 |
Cash and cash equivalents | ||
At beginning of period | 653 | 276 |
At end of period | 984 | 693 |
Supplemental disclosure of cash flow information | ||
Interest (net of amounts capitalized) | 305 | 297 |
Income taxes (net of refunds) | $485 | $536 |
StockBased_Compensation_Unaudi
Stock-Based Compensation (Unaudited) | 9 Months Ended | |
Sep. 30, 2013 | ||
Stock-Based Compensation [Abstract] | ||
Stock-Based Compensation | ||
1. Stock-Based Compensation | ||
During the first quarter of 2013, a committee of non-employee directors of our Board of Directors granted stock options, restricted stock units (RSUs) and performance share units (PSUs) pursuant to the Long-Term Incentive Plan (LTIP) and granted stock options pursuant to the Thoroughbred Stock Option Plan (TSOP) as discussed below. Stock-based compensation was an expense of $4 million during the third quarter of 2013 and a benefit of less than $1 million during the third quarter of 2012. For the first nine months of 2013 and 2012, stock-based compensation expense was $47 million and $41 million, respectively. The total tax effects recognized in income in relation to stock-based compensation were a net benefit of $2 million and a net expense of $1 million for the third quarters of 2013 and 2012, respectively, and net benefits of $16 million and $13 million for the first nine months of 2013 and 2012, respectively. | ||
Stock Options | ||
In the first quarter of 2013, 748,200 options were granted under LTIP and 268,500 options were granted under TSOP. In each case, the grant price was $69.83, which was the greater of the average fair market value of Norfolk Southern common stock (Common Stock) or the closing price of Common Stock on the effective date of the grant, and the options have a term of ten years. The options granted under LTIP and TSOP in 2013 may not be exercised prior to the fourth and third anniversaries of the date of grant, respectively. Holders of the 2013 options granted under LTIP who remain actively employed receive cash dividend equivalent payments for four years in an amount equal to the regular quarterly dividends paid on Common Stock. Dividend equivalent payments are not made on TSOP options. | ||
The fair value of each option award in 2013 was measured on the date of grant using a lattice-based option valuation model. Expected volatilities are based on implied volatilities from traded options on and historical volatility of Common Stock. Historical data is used to estimate option exercises and employee terminations within the valuation model. The average expected option life is derived from the output of the valuation model and represents the period of time that options granted are expected to be outstanding. The average risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. For options granted that include dividend equivalent payments, a dividend yield of zero was used. A dividend yield of 2.86% was used for LTIP options for periods where no dividend equivalent payments are made as well as for TSOP options, which do not receive dividend equivalents. | ||
The assumptions for the 2013 LTIP and TSOP grants are shown in the following table: | ||
Expected volatility range | 24% - 30% | |
Average expected volatility | 26% | |
Average risk-free interest rate | 1.88% | |
Average expected option term LTIP | 9.0 years | |
Per-share grant-date fair value LTIP | $20.40 | |
Average expected option term TSOP | 8.9 years | |
Per-share grant-date fair value TSOP | $15.84 | |
For the third quarter of 2013, options relating to 207,233 shares were exercised, yielding $9 million of cash proceeds and $2 million of tax benefit recognized as additional paid-in capital. For the third quarter of 2012, options relating to 703,231 shares were exercised, yielding $19 million of cash proceeds and $12 million of tax benefit recognized as additional paid-in capital. | ||
For the first nine months of 2013, options relating to 1,778,733 shares were exercised, yielding $62 million of cash proceeds and $22 million of tax benefit recognized as additional paid-in capital. For the first nine months of 2012, options relating to 1,476,527 shares were exercised, yielding $40 million of cash proceeds and $24 million of tax benefit recognized as additional paid-in capital. | ||
Restricted Stock Units | ||
There were 162,000 RSUs granted in 2013, with an average grant-date fair value of $69.83 and a five-year restriction period. The RSUs granted in 2013 will be settled through the issuance of shares of Common Stock. | ||
No RSUs were earned or paid out in the third quarters of 2013 or 2012. During the first nine months of 2013, 298,400 of the RSUs granted in 2008 vested, with 178,250 shares of Common Stock issued net of withholding taxes. For the first nine months of 2012, 311,900 of the RSUs granted in 2007 vested, with 191,875 shares of Common Stock issued net of withholding taxes. The total related tax benefits recognized as additional paid-in capital were $1 million and less than $1 million for the third quarters of 2013 and 2012, respectively, and $3 million for the first nine months of both 2013 and 2012. | ||
Performance Share Units | ||
PSUs provide for awards based on achievement of certain predetermined corporate performance goals (total shareholder return, return on average invested capital, and operating ratio) at the end of a three-year cycle and are paid in the form of shares of Common Stock. During the first quarter of 2013, there were 550,800 PSUs granted with a grant-date fair value of $69.83. | ||
No PSUs were earned or paid out in the third quarters of 2013 and 2012. During the first nine months of 2013, 577,585 of the PSUs granted in 2010 were earned, with 348,189 shares of Common Stock issued net of withholding taxes. For the first nine months of 2012, 782,889 of the PSUs granted in 2009 were earned, with 488,957 shares of Common Stock issued net of withholding taxes. The total related tax benefits recognized as additional paid-in capital were $5 million and $11 million for the first nine months of 2013 and 2012, respectively. | ||
Income_Taxes_Unaudited
Income Taxes (Unaudited) | 9 Months Ended |
Sep. 30, 2013 | |
Income Taxes [Abstract] | |
Income Taxes | 2. Income Taxes |
There have been no material changes to the balance of unrecognized tax benefits reported at December 31, 2012. IRS examinations have been completed for all years prior to 2011. We expect the IRS could begin auditing our 2011 and 2012 consolidated income tax returns in early 2014. |
Earnings_Per_Share_Unaudited
Earnings Per Share (Unaudited) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Earnings Per Share [Abstract] | |||||||||||||
Earnings Per Share | 3. Earnings Per Share | ||||||||||||
Basic | Diluted | ||||||||||||
Third Quarter | |||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
($ in millions except per share amounts, | |||||||||||||
shares in millions) | |||||||||||||
Net income | $ | 482 | $ | 402 | $ | 482 | $ | 402 | |||||
Dividend equivalent payments | (2 | ) | (3 | ) | (1 | ) | (1 | ) | |||||
Income available to common stockholders | 480 | 399 | 481 | 401 | |||||||||
Weighted-average shares outstanding | 310.4 | 317.7 | 310.4 | 317.7 | |||||||||
Dilutive effect of outstanding options | |||||||||||||
and share-settled awards | 3.5 | 4.1 | |||||||||||
Adjusted weighted-average shares outstanding | 313.9 | 321.8 | |||||||||||
Earnings per share | $ | 1.55 | $ | 1.26 | $ | 1.53 | $ | 1.24 | |||||
Basic | Diluted | ||||||||||||
First Nine Months | |||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
($ in millions except per share amounts, | |||||||||||||
shares in millions) | |||||||||||||
Net income | $ | 1,397 | $ | 1,336 | $ | 1,397 | $ | 1,336 | |||||
Dividend equivalent payments | (5 | ) | (7 | ) | (3 | ) | (3 | ) | |||||
Income available to common stockholders | 1,392 | 1,329 | 1,394 | 1,333 | |||||||||
Weighted-average shares outstanding | 313 | 322.9 | 313 | 322.9 | |||||||||
Dilutive effect of outstanding options | |||||||||||||
and share-settled awards | 3.6 | 4.5 | |||||||||||
Adjusted weighted-average shares outstanding | 316.6 | 327.4 | |||||||||||
Earnings per share | $ | 4.45 | $ | 4.12 | $ | 4.4 | $ | 4.07 | |||||
During the third quarters and first nine months of 2013 and 2012, dividend equivalent payments were made to holders of options and RSUs. For purposes of computing basic earnings per share, dividend equivalent payments made to holders of options and RSUs were deducted from net income to determine income available to common stockholders. For purposes of computing diluted earnings per share, we evaluate on a grant-by-grant basis those options and RSUs receiving dividend equivalent payments under the two-class and treasury stock methods to determine which method is the more dilutive for each grant. For those grants for which the two-class method was more dilutive, net income was reduced by dividend equivalent payments to determine income available to common stockholders. The diluted calculations exclude options having exercise prices exceeding the average market price of Common Stock of 0.8 million in both 2013 and 2012. | |||||||||||||
9 |
Stockholders_Equity_Unaudited
Stockholders' Equity (Unaudited) | 9 Months Ended | |||||||||
Sep. 30, 2013 | ||||||||||
Stockholders' Equity [Abstract] | ||||||||||
Stockholders' Equity | 4. Stockholders' Equity | |||||||||
Common Stock | ||||||||||
Common Stock is reported net of shares held by our consolidated subsidiaries (Treasury Shares). Treasury Shares at September 30, 2013 and December 31, 2012, amounted to 20,320,777 shares, with a cost of $19 million at both dates. | ||||||||||
Accumulated Other Comprehensive Loss | ||||||||||
“Accumulated other comprehensive loss” reported in the Consolidated Balance Sheets consisted of the following: | ||||||||||
Accumulated | ||||||||||
Pensions | Other | Accumulated | ||||||||
and Other | Comprehensive | Other | ||||||||
Postretirement | Loss of Equity | Comprehensive | ||||||||
Benefits | Investees | Loss | ||||||||
($ in millions) | ||||||||||
Third Quarter | ||||||||||
30-Jun-13 | $ | (955 | ) | $ | (108 | ) | $ | (1,063 | ) | |
Other comprehensive income (loss): | ||||||||||
Amounts reclassified into net income | 38 | -1 | - | 38 | ||||||
Tax expense | (15 | ) | - | (15 | ) | |||||
Other comprehensive income | 23 | - | 23 | |||||||
30-Sep-13 | $ | (932 | ) | $ | (108 | ) | $ | (1,040 | ) | |
First Nine Months | ||||||||||
31-Dec-12 | $ | (999 | ) | $ | (110 | ) | $ | (1,109 | ) | |
Other comprehensive income (loss): | ||||||||||
Amounts reclassified into net income | 110 | -1 | - | 110 | ||||||
Net gain | - | 2 | 2 | |||||||
Tax expense | (43 | ) | - | (43 | ) | |||||
Other comprehensive income | 67 | 2 | 69 | |||||||
30-Sep-13 | $ | (932 | ) | $ | (108 | ) | $ | (1,040 | ) | |
(1) These items are included in the computation of net periodic pension and postretirement benefit costs. See Note 8, “Pensions and Other Postretirement Benefits” for additional information. |
Stock_Repurchase_Program_Unaud
Stock Repurchase Program (Unaudited) | 9 Months Ended |
Sep. 30, 2013 | |
Stock Repurchase Program [Abstract] | |
Stock Repurchase Program | 5. Stock Repurchase Program |
We repurchased and retired 7.5 million and 16.5 million shares of Common Stock in the first nine months of 2013 and 2012, respectively, at a cost of $564 million and $1.2 billion. The timing and volume of purchases is guided by our assessment of market conditions and other pertinent factors. Any near-term share repurchases are expected to be made with internally generated cash, cash on hand, or proceeds from borrowings. Since the beginning of 2006, we have repurchased and retired 135.9 million shares at a total cost of $8.1 billion. |
Investment_In_Conrail_Unaudite
Investment In Conrail (Unaudited) | 9 Months Ended |
Sep. 30, 2013 | |
Investment In Conrail [Abstract] | |
Investment In Conrail | 6. Investment in Conrail |
Through a limited liability company, we and CSX Corporation (CSX) jointly own Conrail Inc. (Conrail), whose primary subsidiary is Consolidated Rail Corporation (CRC). We have a 58% economic and 50% voting interest in the jointly owned entity, and CSX has the remainder of the economic and voting interests. Our investment in Conrail was $1.0 billion at September 30, 2013, and $996 million at December 31, 2012. | |
CRC owns and operates certain properties (the Shared Assets Areas) for the joint and exclusive benefit of Norfolk Southern Railway Company (NSR) and CSX Transportation, Inc. (CSXT). The costs of operating the Shared Assets Areas are borne by NSR and CSXT based on usage. In addition, NSR and CSXT pay CRC a fee for access to the Shared Assets Areas. “Purchased services and rents” and “Fuel” include expenses for the use of the Shared Assets Areas totaling $42 million and $33 million for the third quarters of 2013 and 2012, respectively, and $115 million and $99 million for the first nine months of 2013 and 2012, respectively. Our equity in the earnings of Conrail, net of amortization, included in “Other income - net” was $9 million and $8 million for the third quarters of 2013 and 2012, respectively, and $27 million and $23 million for the first nine months of 2013 and 2012, respectively. | |
“Accounts payable” includes $188 million at September 30, 2013, and $178 million at December 31, 2012, due to Conrail for the operation of the Shared Assets Areas. In addition, “Other liabilities” includes $133 million at both September 30, 2013 and December 31, 2012, for long-term advances from Conrail, maturing 2035, that bear interest at an average rate of 4.40%. |
Debt_Unaudited
Debt (Unaudited) | 9 Months Ended |
Sep. 30, 2013 | |
Debt [Abstract] | |
Debt | 7. Debt |
In the first quarter of 2013, we repaid $200 million under our accounts receivable securitization facility. At September 30, 2013 and December 31, 2012, the amounts outstanding under the facility were $100 million (at an average variable interest rate of 1.22%) and $300 million (at an average variable interest rate of 1.28%), respectively. In October 2013, we renewed our accounts receivable securitization facility with a 364-day term to run until October 2014. | |
During the third quarter of 2013, we issued $500 million of 4.80% senior notes due 2043. | |
During the first quarter of 2012, we issued $600 million of 3.00% senior notes due 2022. | |
During the third quarter of 2012, we issued $600 million of senior notes at 2.90% due 2023 and paid $115 million of premium in exchange for $521 million of our previously issued notes ($156 million at 7.25% due 2031, $140 million at 5.64% due 2029, $115 million at 5.59% due 2025, $72 million at 7.80% due 2027, and $38 million at 7.05% due 2037). The premium is reflected as a reduction of debt in the Consolidated Balance Sheet and within “Debt repayments” in the Statement of Cash Flows and will be amortized as additional interest expense over the term of the new debt. No gain or loss was recognized as a result of the debt exchange. Also during the third quarter of 2012, we issued $600 million of 3.95% senior notes due 2042. | |
We have authority from our Board of Directors to issue an additional $1.2 billion of debt or equity securities through public or private sale. |
Pensions_And_Other_Postretirem
Pensions And Other Postretirement Benefits (Unaudited) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Pensions And Other Postretirement Benefits [Abstract] | |||||||||||||
Pensions And Other Postretirement Benefits | 8. Pensions and Other Postretirement Benefits | ||||||||||||
We have both funded and unfunded defined benefit pension plans covering principally salaried employees. We also provide specified health care and death benefits to eligible retired employees and their dependents; these plans can be amended or terminated at our option. Under our health care plans, a defined percentage of health care expenses is covered, reduced by any deductibles, co-payments, Medicare payments and, in some cases, coverage provided under other group insurance policies. | |||||||||||||
Other Postretirement | |||||||||||||
Pension Benefits | Benefits | ||||||||||||
Third Quarter | |||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
($ in millions) | |||||||||||||
Service cost | $ | 11 | $ | 8 | $ | 4 | $ | 3 | |||||
Interest cost | 20 | 22 | 12 | 14 | |||||||||
Expected return on plan assets | (35 | ) | (34 | ) | (4 | ) | (4 | ) | |||||
Amortization of net losses | 22 | 19 | 16 | 14 | |||||||||
Net cost | $ | 18 | $ | 15 | $ | 28 | $ | 27 | |||||
Other Postretirement | |||||||||||||
Pension Benefits | Benefits | ||||||||||||
First Nine Months | |||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
($ in millions) | |||||||||||||
Service cost | $ | 31 | $ | 25 | $ | 12 | $ | 11 | |||||
Interest cost | 61 | 66 | 37 | 41 | |||||||||
Expected return on plan assets | (106 | ) | (103 | ) | (12 | ) | (11 | ) | |||||
Amortization of net losses | 66 | 57 | 44 | 40 | |||||||||
Net cost | $ | 52 | $ | 45 | $ | 81 | $ | 81 | |||||
Fair_Value_Unaudited
Fair Value (Unaudited) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Fair Value [Abstract] | |||||||||||||
Fair Value | 9. Fair Value | ||||||||||||
Fair Value Measurements | |||||||||||||
The Financial Accounting Standards Board (FASB) Accounting Standards Codifications (ASC) 820-10, “Fair Value Measurements,” established a framework for measuring fair value and a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels, as follows: | |||||||||||||
Level 1 | Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that we have the ability to access. | ||||||||||||
Level 2 | Inputs to the valuation methodology include: | ||||||||||||
Quoted prices for similar assets or liabilities in active markets; | |||||||||||||
Quoted prices for identical or similar assets or liabilities in inactive markets; | |||||||||||||
Inputs other than quoted prices that are observable for the asset or liability; | |||||||||||||
Inputs that are derived principally from or corroborated by observable market data by correlation or other means. | |||||||||||||
If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability. | |||||||||||||
Level 3 | Inputs to the valuation methodology are unobservable and significant to the fair value measurement. | ||||||||||||
The asset's or liability's fair value measurement level is based on the lowest level of any input that is significant to the fair value measurement. Other than those assets and liabilities described below that approximate fair value, there were no assets or liabilities measured at fair value on a recurring basis at September 30, 2013 or December 31, 2012. | |||||||||||||
Fair Values of Financial Instruments | |||||||||||||
We have evaluated the fair values of financial instruments and methods used to determine those fair values. The fair values of “Cash and cash equivalents,” “Short-term investments,” “Accounts receivable,” “Accounts payable,” and “Short-term debt” approximate carrying values because of the short maturity of these financial instruments. The carrying value of corporate-owned life insurance is recorded at cash surrender value and, accordingly, approximates fair value. The carrying amounts and estimated fair values for the remaining financial instruments, excluding investments accounted for under the equity method, consisted of the following: | |||||||||||||
30-Sep-13 | 31-Dec-12 | ||||||||||||
Carrying | Fair | Carrying | Fair | ||||||||||
Amount | Value | Amount | Value | ||||||||||
($ in millions) | |||||||||||||
Long-term investments | $ | 145 | $ | 176 | $ | 139 | $ | 174 | |||||
Long-term debt, including current maturities | (8,946 | ) | (10,317 | ) | (8,482 | ) | (10,734 | ) | |||||
Underlying net assets were used to estimate the fair value of investments with the exception of notes receivable, which are based on future discounted cash flows. The fair values of long-term debt were estimated based on quoted market prices or discounted cash flows using current interest rates for debt with similar terms, company rating, and remaining maturity. | |||||||||||||
The following table sets forth the fair value of long-term investment and long-term debt balances disclosed above by valuation technique level, within the fair value hierarchy (there were no level 3 valued assets or liabilities). | |||||||||||||
Level 1 | Level 2 | Total | |||||||||||
($ in millions) | |||||||||||||
30-Sep-13 | |||||||||||||
Long-term investments | $ | 45 | $ | 131 | $ | 176 | |||||||
Long-term debt, including current maturities | (10,087 | ) | (230 | ) | (10,317 | ) | |||||||
31-Dec-12 | |||||||||||||
Long-term investments | $ | 41 | $ | 133 | $ | 174 | |||||||
Long-term debt, including current maturities | (10,450 | ) | (284 | ) | (10,734 | ) | |||||||
Commitments_And_Contingencies_
Commitments And Contingencies (Unaudited) | 9 Months Ended |
Sep. 30, 2013 | |
Commitments And Contingencies [Abstract] | |
Commitments And Contingencies | 10. Commitments and Contingencies |
Lawsuits | |
We and/or certain subsidiaries are defendants in numerous lawsuits and other claims relating principally to railroad operations. When we conclude that it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated, it is accrued through a charge to earnings. While the ultimate amount of liability incurred in any of these lawsuits and claims is dependent on future developments, in our opinion, the recorded liability is adequate to cover the future payment of such liability and claims. However, the final outcome of any of these lawsuits and claims cannot be predicted with certainty, and unfavorable or unexpected outcomes could result in additional accruals that could be significant to results of operations in a particular year or quarter. Any adjustments to the recorded liability will be reflected in earnings in the periods in which such adjustments are known. | |
One of our customers, DuPont, has a rate reasonableness complaint pending before the STB alleging that our tariff rates for transportation of regulated movements are unreasonable. We dispute this allegation. Since June 1, 2009, we have been billing and collecting from DuPont amounts based on the challenged tariff rates. We presently expect resolution of the DuPont case to occur in 2014 and believe the estimate of reasonably possible loss will not have a material effect on our financial position, results of operations, or liquidity. With regard to rate cases, we record adjustments to revenues in the periods, if and when, such adjustments are probable and estimable. | |
On November 6, 2007, various antitrust class actions filed against us and other Class I railroads in various Federal district courts regarding fuel surcharges were consolidated in the District of Columbia by the Judicial Panel on Multidistrict Litigation. On June 21, 2012, the court certified the case as a class action. The defendant railroads appealed this certification, and on August 9, 2013, the Court of Appeals for the District of Columbia vacated the District Court's decision and remanded the case for further consideration. We believe the allegations in the complaints are without merit and intend to vigorously defend the cases. We do not believe the outcome of these proceedings will have a material effect on our financial position, results of operations, or liquidity. A lawsuit containing similar allegations against us and four other major railroads that was filed on March 25, 2008, in the U.S. District Court for the District of Minnesota was voluntarily dismissed by the plaintiff subject to a tolling agreement entered into in August 2008. | |
Casualty Claims | |
Casualty claims include employee personal injury and occupational claims as well as third-party claims, all exclusive of legal costs. To aid in valuing our personal injury liability and determining the amount to accrue with respect to such claims during the year, we utilize studies prepared by an independent consulting actuarial firm. Job-related accidental injury and occupational claims are subject to the Federal Employers' Liability Act (FELA), which is applicable only to railroads. FELA's fault-based system produces results that are unpredictable and inconsistent as compared with a no-fault workers' compensation system. The variability inherent in this system could result in actual costs being different from the liability recorded. While the ultimate amount of claims incurred is dependent on future developments, in our opinion, the recorded liability is adequate to cover the future payments of claims and is supported by the most recent actuarial study. In all cases, we record a liability when the expected loss for the claim is both probable and estimable. | |
Employee personal injury claims - The largest component of casualties and other claims expense is employee personal injury costs. The independent actuarial firm engaged by us provides quarterly studies to aid in valuing our employee personal injury liability and estimating personal injury expense. The actuarial firm studies our historical patterns of reserving for claims and subsequent settlements, taking into account relevant outside influences. The actuarial firm uses the results of these analyses to estimate the ultimate amount of liability, which includes amounts for incurred but unasserted claims. We adjust the liability quarterly based upon our assessment and the results of the study. Our estimate of loss liabilities is subject to inherent limitation given the difficulty of predicting future events such as jury decisions, court interpretations, or legislative changes and as such the actual loss may vary from the estimated liability recorded. | |
Occupational claims - Occupational claims (including asbestosis and other respiratory diseases, as well as conditions allegedly related to repetitive motion) are often not caused by a specific accident or event but rather allegedly result from a claimed exposure over time. Many such claims are being asserted by former or retired employees, some of whom have not been employed in the rail industry for decades. The independent actuarial firm provides an estimate of the occupational claims liability based upon our history of claim filings, severity, payments, and other pertinent facts. The liability is dependent upon judgments we make as to the specific case reserves as well as judgments of the actuarial firm in the quarterly studies. The actuarial firm's estimate of ultimate loss includes a provision for those claims that have been incurred but not reported. This provision is derived by analyzing industry data and projecting our experience into the future as far as can be reasonably determined. We adjust the liability quarterly based upon our assessment and the results of the study. However, it is possible that the recorded liability may not be adequate to cover the future payment of claims. Adjustments to the recorded liability are reflected in operating expenses in the periods in which such adjustments become known. | |
Third-party claims - We record a liability for third-party claims including those for highway crossing accidents, trespasser and other injuries, automobile liability, property damage, and lading damage. The actuarial firm assists us with the calculation of potential liability for third-party claims, except lading damage, based upon our experience including the number and timing of incidents, amount of payments, settlement rates, number of open claims, and legal defenses. The actuarial estimate includes a provision for claims that have been incurred but not reported. We adjust the liability quarterly based upon our assessment and the results of the study. Given the inherent uncertainty in regard to the ultimate outcome of third-party claims, it is possible that the actual loss may differ from the estimated liability recorded. | |
Environmental Matters | |
We are subject to various jurisdictions' environmental laws and regulations. We record a liability where such liability or loss is probable and its amount can be estimated reasonably. Claims, if any, against third parties, for recovery of cleanup costs we have incurred are reflected as receivables (when collection is probable) in the Consolidated Balance Sheets and are not netted against the associated liability. Environmental engineers regularly participate in ongoing evaluations of all known sites and in determining any necessary adjustments to liability estimates. We have an Environmental Policy Council, composed of senior managers, to oversee and interpret our environmental policy. | |
Our Consolidated Balance Sheets include liabilities for environmental exposures of $59 million at September 30, 2013, and $42 million at December 31, 2012 (of which $12 million is classified as a current liability at the end of each period). At both September 30, 2013 and December 31, 2012, the liability represents our estimate of the probable cleanup, investigation, and remediation costs based on available information at 146 known locations and projects. At September 30, 2013, ten sites accounted for $28 million of the liability, and no individual site was considered to be material. We anticipate that much of this liability will be paid out over five years; however, some costs will be paid out over a longer period. | |
At 15 locations, one or more of our subsidiaries in conjunction with a number of other parties have been identified as potentially responsible parties under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 or comparable state statutes that impose joint and several liability for cleanup costs. We calculate our estimated liability for these sites based on facts and legal defenses applicable to each site and not solely on the basis of the potential for joint liability. | |
With respect to known environmental sites (whether identified by us or by the Environmental Protection Agency (EPA) or comparable state authorities), estimates of our ultimate potential financial exposure for a given site or in the aggregate for all such sites are necessarily imprecise because of the widely varying costs of currently available cleanup techniques, unpredictable contaminant recovery and reduction rates associated with available cleanup technologies, the likely development of new cleanup technologies, the difficulty of determining in advance the nature and full extent of contamination and each potential participant's share of any estimated loss (and that participant's ability to bear it), and evolving statutory and regulatory standards governing liability. | |
The risk of incurring environmental liability - for acts and omissions, past, present, and future - is inherent in the railroad business. Some of the commodities in our traffic mix, particularly those classified as hazardous materials, pose special risks that we work diligently to minimize. In addition, several of our subsidiaries own, or have owned, land used as operating property, or which is leased and operated by others, or held for sale. Because environmental problems that are latent or undisclosed may exist on these properties, there can be no assurance that we will not incur environmental liabilities or costs with respect to one or more of them, the amount and materiality of which cannot be estimated reliably at this time. Moreover, lawsuits and claims involving these and potentially other unidentified environmental sites and matters are likely to arise from time to time. The resulting liabilities could have a significant effect on our financial position, results of operations, or liquidity in a particular year or quarter. | |
Based on our assessment of the facts and circumstances now known, we believe we have recorded the probable and reasonably estimable costs for dealing with those environmental matters of which we are aware. Further, we believe that it is unlikely that any known matters, either individually or in the aggregate, will have a material adverse effect on our financial position, results of operations, or liquidity. | |
Insurance | |
We obtain on behalf of ourself and our subsidiaries insurance for potential losses for third-party liability and first-party property damages. We are currently self-insured up to $50 million and above $1.1 billion per occurrence for bodily injury and property damage to third parties and up to $25 million and above $175 million per occurrence for property owned by us or in our care, custody, or control. | |
Purchase Commitments | |
At September 30, 2013, we had outstanding purchase commitments totaling approximately $340 million for track and yard expansion projects, locomotives, track material, freight cars, and vehicle fleet additions, in connection with our capital programs through 2016. | |
New_Accounting_Pronouncements_
New Accounting Pronouncements (Unaudited) | 9 Months Ended |
Sep. 30, 2013 | |
New Accounting Pronouncements [Abstract] | |
New Accounting Pronouncements [Text Block] | 11. New Accounting Pronouncement |
In the first quarter of 2013, we prospectively adopted Accounting Standards Update (ASU) No. 2013-02, “Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.” This update requires the disclosure of the effects of reclassifications out of Accumulated Other Comprehensive Loss on the respective line items in our Consolidated Statements of Income if the amount being reclassified is required under GAAP to be reclassified in its entirety to net income. For other amounts that are not required to be reclassified in their entirety to net income in the same reporting period, we are required to cross-reference other required GAAP disclosures to provide additional detail about those amounts. These disclosures can be made on the face of the financial statement that reports net income or in the notes, provided all the information is disclosed in a single location. However, an entity is prohibited from providing this information on the face of the statement that reports net income if it has items that are not reclassified in their entirety into net income. This update does not change the requirement to present the components of net income and other comprehensive income in either a single continuous statement or two separate consecutive statements, nor does it change the items currently reported in other comprehensive income. |
StockBased_Compensation_Unaudi1
Stock-Based Compensation (Unaudited) (Tables) | 9 Months Ended | |
Sep. 30, 2013 | ||
Stock-Based Compensation [Abstract] | ||
Schedule Of Assumptions Used For LTIP And TSOP Grants | Expected volatility range | 24% - 30% |
Average expected volatility | 26% | |
Average risk-free interest rate | 1.88% | |
Average expected option term LTIP | 9.0 years | |
Per-share grant-date fair value LTIP | $20.40 | |
Average expected option term TSOP | 8.9 years | |
Per-share grant-date fair value TSOP | $15.84 |
Earnings_Per_Share_Unaudited_T
Earnings Per Share (Unaudited) (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Earnings Per Share [Abstract] | |||||||||||||
Schedule Of Earnings Per Share Calculation | Basic | Diluted | |||||||||||
Third Quarter | |||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
($ in millions except per share amounts, | |||||||||||||
shares in millions) | |||||||||||||
Net income | $ | 482 | $ | 402 | $ | 482 | $ | 402 | |||||
Dividend equivalent payments | (2 | ) | (3 | ) | (1 | ) | (1 | ) | |||||
Income available to common stockholders | 480 | 399 | 481 | 401 | |||||||||
Weighted-average shares outstanding | 310.4 | 317.7 | 310.4 | 317.7 | |||||||||
Dilutive effect of outstanding options | |||||||||||||
and share-settled awards | 3.5 | 4.1 | |||||||||||
Adjusted weighted-average shares outstanding | 313.9 | 321.8 | |||||||||||
Earnings per share | $ | 1.55 | $ | 1.26 | $ | 1.53 | $ | 1.24 | |||||
Basic | Diluted | ||||||||||||
First Nine Months | |||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
($ in millions except per share amounts, | |||||||||||||
shares in millions) | |||||||||||||
Net income | $ | 1,397 | $ | 1,336 | $ | 1,397 | $ | 1,336 | |||||
Dividend equivalent payments | (5 | ) | (7 | ) | (3 | ) | (3 | ) | |||||
Income available to common stockholders | 1,392 | 1,329 | 1,394 | 1,333 | |||||||||
Weighted-average shares outstanding | 313 | 322.9 | 313 | 322.9 | |||||||||
Dilutive effect of outstanding options | |||||||||||||
and share-settled awards | 3.6 | 4.5 | |||||||||||
Adjusted weighted-average shares outstanding | 316.6 | 327.4 | |||||||||||
Earnings per share | $ | 4.45 | $ | 4.12 | $ | 4.4 | $ | 4.07 | |||||
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 9 Months Ended | |||||||||
Sep. 30, 2013 | ||||||||||
Stockholders' Equity [Abstract] | ||||||||||
Accumulated Other Comprehensive Loss | Accumulated | |||||||||
Pensions | Other | Accumulated | ||||||||
and Other | Comprehensive | Other | ||||||||
Postretirement | Loss of Equity | Comprehensive | ||||||||
Benefits | Investees | Loss | ||||||||
($ in millions) | ||||||||||
Third Quarter | ||||||||||
30-Jun-13 | $ | (955 | ) | $ | (108 | ) | $ | (1,063 | ) | |
Other comprehensive income (loss): | ||||||||||
Amounts reclassified into net income | 38 | -1 | - | 38 | ||||||
Tax expense | (15 | ) | - | (15 | ) | |||||
Other comprehensive income | 23 | - | 23 | |||||||
30-Sep-13 | $ | (932 | ) | $ | (108 | ) | $ | (1,040 | ) | |
First Nine Months | ||||||||||
31-Dec-12 | $ | (999 | ) | $ | (110 | ) | $ | (1,109 | ) | |
Other comprehensive income (loss): | ||||||||||
Amounts reclassified into net income | 110 | -1 | - | 110 | ||||||
Net gain | - | 2 | 2 | |||||||
Tax expense | (43 | ) | - | (43 | ) | |||||
Other comprehensive income | 67 | 2 | 69 | |||||||
30-Sep-13 | $ | (932 | ) | $ | (108 | ) | $ | (1,040 | ) | |
Pensions_And_Other_Postretirem1
Pensions And Other Postretirement Benefits (Unaudited) (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Pensions And Other Postretirement Benefits [Abstract] | |||||||||||||
Pension And Other Postretirement Benefit Cost Components | Other Postretirement | ||||||||||||
Pension Benefits | Benefits | ||||||||||||
Third Quarter | |||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
($ in millions) | |||||||||||||
Service cost | $ | 11 | $ | 8 | $ | 4 | $ | 3 | |||||
Interest cost | 20 | 22 | 12 | 14 | |||||||||
Expected return on plan assets | (35 | ) | (34 | ) | (4 | ) | (4 | ) | |||||
Amortization of net losses | 22 | 19 | 16 | 14 | |||||||||
Net cost | $ | 18 | $ | 15 | $ | 28 | $ | 27 | |||||
Other Postretirement | |||||||||||||
Pension Benefits | Benefits | ||||||||||||
First Nine Months | |||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
($ in millions) | |||||||||||||
Service cost | $ | 31 | $ | 25 | $ | 12 | $ | 11 | |||||
Interest cost | 61 | 66 | 37 | 41 | |||||||||
Expected return on plan assets | (106 | ) | (103 | ) | (12 | ) | (11 | ) | |||||
Amortization of net losses | 66 | 57 | 44 | 40 | |||||||||
Net cost | $ | 52 | $ | 45 | $ | 81 | $ | 81 | |||||
Fair_Value_Unaudited_Tables
Fair Value (Unaudited) (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Fair Value [Abstract] | |||||||||||||
Schedule Of Carrying Amounts And Estimated Fair Values | 30-Sep-13 | 31-Dec-12 | |||||||||||
Carrying | Fair | Carrying | Fair | ||||||||||
Amount | Value | Amount | Value | ||||||||||
($ in millions) | |||||||||||||
Long-term investments | $ | 145 | $ | 176 | $ | 139 | $ | 174 | |||||
Long-term debt, including current maturities | (8,946 | ) | (10,317 | ) | (8,482 | ) | (10,734 | ) | |||||
Schedule Of Fair Value Of Long-term Assets And Liabilities | Level 1 | Level 2 | Total | ||||||||||
($ in millions) | |||||||||||||
30-Sep-13 | |||||||||||||
Long-term investments | $ | 45 | $ | 131 | $ | 176 | |||||||
Long-term debt, including current maturities | (10,087 | ) | (230 | ) | (10,317 | ) | |||||||
31-Dec-12 | |||||||||||||
Long-term investments | $ | 41 | $ | 133 | $ | 174 | |||||||
Long-term debt, including current maturities | (10,450 | ) | (284 | ) | (10,734 | ) | |||||||
StockBased_Compensation_Unaudi2
Stock-Based Compensation (Unaudited) (Narrative) (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Millions, except Share data, unless otherwise specified | Sep. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation benefit | $1 | ||||
Stock-based compensation expense | 4 | 47 | 41 | ||
Tax expenses associated with stock-based compensation costs | 1 | ||||
Tax benefits associated with stock-based compensation costs | 2 | 16 | 13 | ||
Grant price of options granted | $69.83 | ||||
Stock option term, in years | 23-Jan-23 | ||||
LTIP dividend equivalent payment, in years | 4 years | ||||
Dividend yield for period dividend equivalents paid | 0.00% | ||||
Dividend yield for period dividend equivalents not paid | 2.86% | ||||
Stock options exercised | 207,233 | 703,231 | 1,778,733 | 1,476,527 | |
Proceeds from stock options exercised | 9 | 19 | 62 | 40 | |
Excess tax benefits recognized for share-based awards | 2 | 12 | 22 | 24 | |
LTIP [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock options granted | 748,200 | ||||
Award vesting period, grant anniversary | 4 years | ||||
TSOP [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock options granted | 268,500 | ||||
Award vesting period, grant anniversary | 3 years | ||||
Restricted Stock Units (RSUs) [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Grants other than stock options | 162,000 | ||||
Restriction period, in years | 5 years | ||||
Grant-date fair value of units granted | $69.83 | ||||
Restricted stock units vested | 0 | 0 | 298,400 | 311,900 | |
Restricted Stock Units tax (expense) benefit | 1 | 0 | 3 | 3 | |
Shares issued net of withholding taxes | 0 | 0 | 178,250 | 191,875 | |
PSU [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Performance Share Units Cycle, in years | 3 years | ||||
Grants other than stock options | 550,800 | ||||
Grant-date fair value of units granted | $69.83 | ||||
Performance share units earned | 0 | 0 | 577,585 | 782,889 | |
Performance Share Units tax benefit (expense) | $5 | $11 | |||
Shares issued net of withholding taxes | 348,189 | 488,957 |
StockBased_Compensation_Unaudi3
Stock-Based Compensation (Unaudited) (Schedule Of Assumptions Used For LTIP And TSOP Grants) (Details) (USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Expected volatility rate, minimum | 24.00% |
Expected volatility rate, maximum | 30.00% |
Average expected volatility rate | 26.00% |
Average risk-free interest rate | 1.88% |
LTIP [Member] | |
Average expected option term, in years | 9 years |
Option per share grant-date fair value | 20.4 |
TSOP [Member] | |
Average expected option term, in years | 8 years 10 months 24 days |
Option per share grant-date fair value | 15.84 |
Earnings_Per_Share_Unaudited_D
Earnings Per Share (Unaudited) (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Basic earnings per share | $1.55 | $1.26 | $4.45 | $4.12 |
Diluted earnings per share | $1.53 | $1.24 | $4.40 | $4.07 |
Options having exercise prices exceeding average market price | 800,000 | 800,000 | 800,000 | 800,000 |
Net income | $482 | $402 | $1,397 | $1,336 |
Earnings Per Share, Basic [Member] | ||||
Dividend equivalent payments | -2 | -3 | -5 | -7 |
Income available to common stockholders, basic | 480 | 399 | 1,392 | 1,329 |
Weighted-average shares outstanding | 310,400,000 | 317,700,000 | 313,000,000 | 322,900,000 |
Basic earnings per share | $1.55 | $1.26 | $4.45 | $4.12 |
Net income | 482 | 402 | 1,397 | 1,336 |
Earnings Per Share, Diluted [Member] | ||||
Dividend equivalent payments | -1 | -1 | -3 | -3 |
Income available to common stockholders, diluted | 481 | 401 | 1,394 | 1,333 |
Weighted-average shares outstanding | 310,400,000 | 317,700,000 | 313,000,000 | 322,900,000 |
Dilutive effect of outstanding options and share-settled awards | 3,500,000 | 4,100,000 | 3,600,000 | 4,500,000 |
Adjusted weighted-average shares outstanding | 313,900,000 | 321,800,000 | 316,600,000 | 327,400,000 |
Diluted earnings per share | $1.53 | $1.24 | $4.40 | $4.07 |
Net income | $482 | $402 | $1,397 | $1,336 |
Stockholders_Equity_Unaudited_
Stockholders' Equity (Unaudited) (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Millions, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
Shares held by consolidated subsidiaries | 20,320,777 | 20,320,777 | 20,320,777 | ||
Value of shares held by consolidated subsidiaries | $19 | $19 | $19 | ||
Accumulated other comprehensive loss - beginning balance | -1,063 | -1,109 | |||
Amounts reclassified into net income | 38 | 110 | |||
Net gain | 0 | 2 | |||
Income tax expense related to items of other comprehensive income | -15 | -13 | -43 | -38 | |
Other comprehensive income, net of tax | 23 | 20 | 69 | 55 | |
Accumulated other comprehensive loss - ending balance | -1,040 | -1,040 | |||
Pensions And Other Postretirement Liabilities [Member] | |||||
Accumulated other comprehensive loss - beginning balance | -955 | -999 | |||
Amounts reclassified into net income | 38 | 110 | |||
Net gain | 0 | 0 | |||
Income tax expense related to items of other comprehensive income | -15 | -43 | |||
Other comprehensive income, net of tax | 23 | 67 | |||
Accumulated other comprehensive loss - ending balance | -932 | -932 | |||
Accumulated Other Comprehensive Loss Equity Investees [Member] | |||||
Accumulated other comprehensive loss - beginning balance | -108 | -110 | |||
Amounts reclassified into net income | 0 | 0 | |||
Net gain | 0 | 2 | |||
Income tax expense related to items of other comprehensive income | 0 | 0 | |||
Other comprehensive income, net of tax | 0 | 2 | |||
Accumulated other comprehensive loss - ending balance | ($108) | ($108) |
Stock_Repurchase_Program_Unaud1
Stock Repurchase Program (Unaudited) (Details) (USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Stock Repurchase Program [Abstract] | ||
Stock repurchased and retired during period, shares | 7.5 | 16.5 |
Stock repurchased and retired during period, cost | $564 | $1,200 |
Stock repurchased and retired since beginning of stock repurchase program in 2006, shares | 135.9 | |
Stock repurchased and retired since beginning of stock repurchase program in 2006, cost | $8,100 |
Investment_In_Conrail_Unaudite1
Investment In Conrail (Unaudited) (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
Schedule of Investments [Line Items] | |||||
Equity method investments | $1,000 | $1,000 | $996 | ||
Equity in the earnings of Conrail | 9 | 8 | 27 | 23 | |
Expenses for the use of the Shared Assets Area | 42 | 33 | 115 | 99 | |
Due to affiliate, current | 188 | 188 | 178 | ||
Due to affiliate, noncurrent | $133 | $133 | $133 | ||
Due to affiliate, noncurrent, maturity date | 2035 | 2035 | 2035 | ||
Due to affiliate, average interest rate | 4.40% | 4.40% | 4.40% | ||
Conrail Equity [Member] | |||||
Schedule of Investments [Line Items] | |||||
Equity method investment, ownership percentage | 58.00% | 58.00% | 58.00% | ||
Conrail Voting [Member] | |||||
Schedule of Investments [Line Items] | |||||
Equity method investment, ownership percentage | 50.00% | 50.00% | 50.00% |
Debt_Unaudited_Details
Debt (Unaudited) (Details) (USD $) | 3 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | |||||||||||||
In Millions, unless otherwise specified | Sep. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2013 |
Senior Note 3.00% Due 2022 [Member] | Senior Note 3.00% Due 2022 [Member] | Senior Note 3.00% Due 2022 [Member] | Senior Note 3.95% Due 2042 [Member] | Senior Note 3.95% Due 2042 [Member] | Senior Note 3.95% Due 2042 [Member] | Senior Note 2.90% Due 2023 [Member] | Senior Note 7.25% Due 2031 [Member] | Senior Note 5.64% Due 2029 [Member] | Senior Note 5.59% Due 2025 [Member] | Senior Note 7.80% Due 2027 [Member] | Senior Note 7.05% Due 2037 [Member] | Previously Issued Notes [Member] | Senior Note 4.80% Due 2043 [Member] | |||||
Debt Instrument [Line Items] | ||||||||||||||||||
Repayments of short-term debt | $200 | |||||||||||||||||
Accounts receivable securitization balance | 100 | 300 | ||||||||||||||||
Average variable interest rate | 1.22% | 1.28% | ||||||||||||||||
Receivables securitization facility term, days | 364 | |||||||||||||||||
Proceeds from issuance of long-term debt | 600 | 600 | 500 | |||||||||||||||
Debt instrument, interest rate, stated percentage | 3.00% | 3.95% | 4.80% | |||||||||||||||
Debt instrument, maturity date, year | 2022 | 2042 | 2043 | |||||||||||||||
Authority to issue debt/equity securities | 1,200 | |||||||||||||||||
New debt, debt exchange | 600 | |||||||||||||||||
New rate, debt exchange | 2.90% | |||||||||||||||||
New due date, debt exchange | 2023 | |||||||||||||||||
Original debt | 156 | 140 | 115 | 72 | 38 | 521 | ||||||||||||
Original rate | 7.25% | 5.64% | 5.59% | 7.80% | 7.05% | |||||||||||||
Original due date, year | 2031 | 2029 | 2025 | 2027 | 2037 | |||||||||||||
Cash premium, debt exchange | $115 |
Pensions_And_Other_Postretirem2
Pensions And Other Postretirement Benefits (Unaudited) (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Pension Plans, Defined Benefit [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $11 | $8 | $31 | $25 |
Interest cost | 20 | 22 | 61 | 66 |
Expected return on plan assets | -35 | -34 | -106 | -103 |
Amortization of net losses | 22 | 19 | 66 | 57 |
Net cost | 18 | 15 | 52 | 45 |
Other Postretirement Benefit Plans, Defined Benefit [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 4 | 3 | 12 | 11 |
Interest cost | 12 | 14 | 37 | 41 |
Expected return on plan assets | -4 | -4 | -12 | -11 |
Amortization of net losses | 16 | 14 | 44 | 40 |
Net cost | $28 | $27 | $81 | $81 |
Fair_Value_Unaudited_Narrative
Fair Value (Unaudited) (Narrative) (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Fair Value [Abstract] | ||
Assets or liabilities measured at fair value | $0 | $0 |
Fair_Value_Unaudited_Schedule_
Fair Value (Unaudited) (Schedule Of Carrying Amounts And Estimated Fair Values) (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Fair Value [Abstract] | ||
Long-term investments, carrying value | $145 | $139 |
Long-term investments, fair value | 176 | 174 |
Long-term debt, including current maturities, carrying value | -8,946 | -8,482 |
Long-term debt, including current maturities, fair value | ($10,317) | ($10,734) |
Fair_Value_Unaudited_Schedule_1
Fair Value (Unaudited) (Schedule Of Fair Value Of Long-term Assets And Liabilities) (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term investments | $176 | $174 |
Long-term debt, including current maturities, fair value | -10,317 | -10,734 |
Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term investments | 45 | 41 |
Long-term debt, including current maturities, fair value | -10,087 | -10,450 |
Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term investments | 131 | 133 |
Long-term debt, including current maturities, fair value | ($230) | ($284) |
Commitments_And_Contingencies_1
Commitments And Contingencies (Unaudited) (Details) (USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 |
Commitments And Contingencies [Abstract] | ||
Environmental liability | $59 | $42 |
Current environmental liability | 12 | 12 |
Known cleanup and remediation locations and projects | 146 | 146 |
Number of sites - representative sample | 10 | |
Liability associated with those sites | 28 | |
Environmental locations representative sample liability payout period, in years | 5 | |
Responsible locations with another party | 15 | |
Self-insured injury/damage to third party - up to | 50 | |
Self-insured injury/damage to third parties - and above, per occurrence | 1,100 | |
Self-insured NS owned property - up to | 25 | |
Self-insured NS owned property - and above, per occurrence | 175 | |
Purchase commitments, long-term service contracts | $340 |