Posts Tagged ‘Canadian National’

Wolverines Disrupted by Derailment, Equipment Issues

February 2, 2023

A Canadian National derailment in Detroit has disrupted Amtrak’s Wolverine Service.

The derailment occurred late Tuesday night in southwest Detroit when eight cars derailed, including one that was reported to be leaning over a bridge.

The derailed cars were empty and no injuries occurred as a result of the derailment.

However, Amtrak cited unexplained “equipment issues” for cancelling trains on Wednesday and Thursday in the Chicago-Detroit (Pontiac) corridor.

The CN derailment led to Train 351 from Chicago being terminated in Detroit rather than continuing on to Pontiac.

On Wednesday, Train 352 to Chicago was cancelled. Today (Feb. 2) No. 350, the early morning departure to Chicago, and Train 355, the late afternoon departure to Pontiac, are cancelled.

Amtrak is providing alternative bus transportation to passengers affected by the cancellations.

CN Operating Income Up 22% in 2022

January 25, 2023

Canadian National said on Tuesday that its operating income in 2022 rose 22 percent to $6.8 billion.

CN officials said revenue increased 18 percent, to $17 billion while adjusted earnings per share rose by 25 percent.

The operating ratio was 60 percent, a 1.2-point improvement over 2021, or 59.9 percent on an adjusted basis.

Traffic volume for 2022 was up 1 percent when measured by revenue ton-miles but was down 0.5 percent when measured by carloads.

During the fourth quarter, operating income rose 22 percent, to 1.9 billion with revenue increasing 21 percent, to $4.5 billion.

Earnings per share was up 24 percent, or 23 percent on an adjusted basis. The operating ratio improved 0.4 points to 57.9 percent.

Quarterly volume was up 6 percent on a revenue ton-mile basis, or 2.4 percent on a carload basis.

In looking ahead CN CEO Tracy Robinson said the railroad faces an uncertain outlook for 2023 due to a potential economic downturn.

Speaking during a financial call with investors, Robinson expects freight volume to outperform North American industrial production this year but see a decline of 0.5 percent due to a slowing economy.

CN executives expect bulk traffic such as grain and coal to remain strong through the first half of this year and thus provide a cushion against declines in other traffic.

CN, NS CEOs Defend Scheduled Railroading

January 21, 2023

CEOs of Norfolk Southern and Canadian National sought to make the case for why precision scheduled railroading is best for shippers and railroads during the recent Midwest Association of Rail Shippers.

As reported by Trains magazine on its website, CN CEO Tracy Robinson argued that scheduled railroading is working for shippers and the railroad alike.

NS CEO Alan Shaw reiterated a point he made last year that the Atlanta-based Class 1 carrier is seeking to refine its scheduled railroading practices to move away from the cycle of reducing its workforce during economic downturns as has been the industry standard.

Robinson described PSR as basic railroading that provides consistent service. The key to that is providing on-time service.

“We are moving meaningfully faster, and we are dwelling less,” Robinson said.

“So we’re learning as we go, we’re relearning as we go, and we’re going to remain focused on scheduled railroading.”

During his remarks Shaw said NS is no longer trying to “time the market” in its decisions about crew staffing and assets.

“Because frankly, that’s where we’ve gotten in trouble in the past,” he said. “The economy moves up, and we don’t have enough crews, or enough intermodal chassis, or enough locomotives.”

Shaw said NS is taking a longer view by seeking to determine what it needs to get to where it wants to be in terms of operating efficiency three to five years from now and pouring resources into achieving that.

He attributed the service issues NS has experienced in the past couple years to trying to move up and down with the economic cycle.

Reacting to the current economic cycle has been useful in achieving short-term profitability but Shaw said that has come at the cost of lost revenue opportunity in the longer term.

“We took a look at this, and look at the revenue opportunity you lose, when you have a poor service product,” Shaw said. “And we’re also talking about the additional costs. I don’t think people realize a faster railroad is a less expensive railroad. One that’s running on time, one that’s running on schedule, is less expensive than one that’s running off schedule.”

Additional information about what Robinson and Shaw had to say can be read at https://www.trains.com/trn/news-reviews/news-wire/cn-ns-ceos-tell-shippers-service-will-continue-to-improve/

CSX, CN Seek to Block New STB Rate Rule

January 11, 2023

CSX, Canadian National and Union Pacific have gone to court to try to block implementation of a U.S. Surface Transportation Board rule seeking to streamline the settlement of small rate disputes with shippers.

CSX filed suit in the U.S. Court of Appeals for the 11th Circuit challenging an arbitration process that the STB plans to launch as part of the new rules, which the agency said are designed to make it easier, faster and less expensive for shippers to initiate cases seeking up to $4 million in relief over two years.

The rules were adopted in December as part of a new process called Final Offer Rate Review. The rule drew applause from shippers but was attacked by the Association of American Railroads as unworkable.

UP filed a similar lawsuit in the appeals court for the Eighth Circuit seeking to block the STB rule. CN’s challenge of the rule was filed in the Seventh Circuit appeals court by its U.S. subsidiaries, Illinois Central and Grand Trunk Western.

A sticking point in the small rate case rules is the arbitration component. STB wants all Class 1 railroads to agree to binding arbitration while the railroads have called for voluntary arbitration.

The AAR has argued that the Final Offer Rate Review process exceeds the agency’s legal regulatory authority.

AAR s position is that the effect of the new rule is that regulators will choose and impose the rate proposed by the shipper or the rate offered by the railroad.

The trade association also has been critical of the requirement that all Class 1 railroads must agree to participate.

The STB for its part has sought to frame the new rule as striking a balance between competing interests.

CN, CSX Make Sustainability List

December 15, 2022

CSX and Canadian National have been named to the Dow Jones Sustainability Indices of North America.

The DJSI is made up of companies that achieve high scores on S&P Global’s Corporate Sustainability Assessment.

The index is based on public and nonpublic data submitted by participating companies with  more than 10,000 publicly traded companies invited to participate in the S&P Global CSA.

CN Appoints New Chief Operating Officer

November 29, 2022

Canadian National has replaced its chief operating officer.

The Montreal-based Class I railroad has named Edmond “Ed” Harris as executive vice president and chief operating officer effective immediately. He succeeds Rob Reilly.

Harris has been a consultant to CN since April 2022. He previously served as executive vice president of operations at CSX (2018 to 2020) and chief operations officer at Canadian Pacific (2010 to 2012.

Harris also held executive positions at Illinois Central and CN, including serving as CN’s executive vice president of operations.

In a news release, CN said Harris in a consulting capacity “worked closely with the entire CN operations leadership team on the company’s operational and service excellence initiatives, as the team delivered meaningful rail operations performance and customer service improvements.”

CN Provides Land for Conneaut Reclamation Plant

November 3, 2022

Canadian National is providing land for a project in Conneaut to dredge the city’s harbor on Lake Erie.

The project was kicked off on Oct. 26 with a groundbreaking ceremony for construction of the city’s dredged material reclamation facility.

City officials said the facility will help keep the waters of Conneaut Harbor clean and accessible for ships.

A report in the Ashtabula Star Beacon said the project came about because of a state law banning open lake dumping of dredged material. Instead, the dredged material will be processed at a treatment plant.

“By taking that out of the lake and bringing it into an upland treatment facility like we’re constructing here, if all seven of the Great Lakes ports in Ohio do that, we can reduce algal blooms on Lake Erie by as much as 50 percent, which is huge,” said Jim Hockaday, Conneaut city manager.

The facility will be located on land owned by CN and leased to the city for $1 a year for 40 years.

Independence Excavating has been awarded a $11.47 million contract to build the facility, which is expected to open in a year once work begins.

“We have obviously a huge footprint here; we have interest in the maritime trade and making sure that the vessels could come in loaded, so for it to work, we needed to come to the table and give part of our property for a dollar, so that’s how we made it work,” said CN Vice President of Strategy Jamie Lockwood.

The plant will be known as the Conneaut Creek Dredge Reclamation Facility

CN Set Financial Records in 3rd Quarter

October 26, 2022

Canadian National this week released its third quarter financial results showing record revenue, operating income, and adjusted earnings per share.

Quarterly operating income was up 44 percent to $1.9 billion, revenue rose 26 percent to $4.5 billion, and earnings per share posted a 40 percent gain.

The earnings per share were adjusted for one-time items related to CN’s failed bid to acquire Kansas City Southern.

The operating ratio gained .8 points to an adjusted 57.2 percent. All comparisons are to the third quarter of 2021.

CN is projecting earnings per share to grow around 25 percent, up from its previous forecast of 15 percent to 20 percent.

During an earnings call with investors, CN Chief Operating Officer Rob Reilly said on-time train originations were 87 percent, a 12 percent increase compared with the same quarter of 2021.

Although more trains arrived on schedule during the quarter, CN did not disclose its on-time arrival performance.

Traffic was up 3 percent in the quarter when measured by carloads and containers, or 5 percent based on revenue ton-miles, the preferred metric of Canadian railroads.

No Injuries in CN, SEPTA Derailments

September 30, 2022

No injuries were reported in derailments of Canadian National and SEPTA commuter trains.

The CN derailment occurred at 7:30 a.m. in Warren, Michigan, a suburban of Detroit and involved 12 cars leaving the rails.

The derailment snarled traffic during the morning rush hour.

News reports indicated that three of the derailed cars were tank cars carrying liquid chlorine and unrefined alcohol but they remained upright.

One of the cars was reporting to be leaking slightly but emergency officials said this did not pose a public hazard.

The train had 151 cars. Officials said the cleanup could last several days and traffic will continue to be disrupted.

Bus service on two routes was disrupted after a Southeastern Pennsylvania Transportation Authority train derailed late Wednesday morning as the train left the Trenton (New Jersey) Transportation Center.

The second and third cars of the four-car train bound for Philadelphia left the rails.

The train had 25 passengers aboard. New Jersey Transit Northeast Corridor trains to Trenton were also affected by the derailment and were experiencing delays of up to an hour.

SEPTA suspended service between Philadelphia and Trenton while the train was re-railed and removed.

Five trains were cancelled and service issues continued into Thursday morning with trains cancelled in each direction. Other trains were delayed up to 10 minutes.

CN Reports 2nd Quarter Financial Records

July 27, 2022

Canadian National reported on Tuesday that its second quarter 2022 performance included record revenue and a record operating income.

In a news release, CN said adjusted diluted earnings per share were a record C$1.93, up 30 percent.

CN said its operational performance improved in key operating metrics such as origin train performance, car velocity, through dwell and record fuel efficiency, resulting in a lower operating ratio.

The news release said revenue was C$4,344 million, an increase of C$746 million or 21 percent

The operating income of C$1,769 million rose 28 percent, and record adjusted operating income of C$1,781 million was an increase of 29 percent.

The operating ratio, defined as operating expenses as a percentage of revenues, was 59.3 percent, an improvement of 2.3-points, and adjusted operating ratio of 59.0 percent, an improvement of 2.6-points.

All percentage changes are comparisons with the second quarter of 2021.

The Montreal-based carrier said it expects approximately a 15-20 percent adjusted diluted earnings per share growth in 2022 while seeking an operating ratio below 60 percent.

CN attributed its higher revenues in the second quarter to higher fuel surcharge rates, freight rate increases, higher Canadian export volumes of coal via west coast ports, higher volumes of U.S. grain and the positive translation impact of a weaker Canadian dollar; partly offset by significantly lower export volumes of Canadian grain.

During an earnings call CN CEO Tracy Robinson said the railroad is performing at its highest levels in five years.

“We’ve leaned in to our scheduled operations, improving train performance and service to customers. And we’re seeing the beginning of improvements in velocity,” Robinson said.

CN executives said during the call that the carrier has hired 850 conductors since the end of 2021.

During the quarter CN said it handled record traffic levels in the U.S., thanks partly to a rise in export grain and coal shipments due to the war in Ukraine.

More information is available at https://www.cn.ca/en/news/2022/07/cn-reports-second-quarter-results/