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.

This article relies excessively on references to primary sources. (November 2010)

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Watco

Company type	Freight Transportation Services and Logistics
Industry	Railroads Logistics Terminals & Ports
Founded	July 1 , 1983
Founder	Charles R. "Dick" Webb [1]
Headquarters	Pittsburg, KS 66762
Area served	North America and Australia
Key people	Dan Smith, CEO
Number of employees	4,800
Website	www.watco.com

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Watco owns and/or operates 45 short line railroads in North America and Australia, with more than 8,000 miles 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 employs about 4,800 team members, 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®. ^[2]

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.^[3][4] Operations commenced in March 2012.^[5][6] 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.^[7] Additional $50 million equity investment completed in December 2011.^[8] 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.^[9]

On December 28, 2011, Watco began operations of the Swan Ranch Railroad^[10] 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.^[11][12]

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.^[13] This joint venture was dissolved in August 2018.^[14]

In July 2018, Dan Smith was named Watco's new CEO.^[15]

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.^[16]

In January 2022, Watco takes over operations to move cattle in Queensland CBH Group to Aurizon.^[17]