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July 2012

Rail News: Rail Industry Trends

Railway association: Canada's RAC needs to be more of a promoter and educator, CEO Bourque says

By Jeff Stagl, Managing Editor

More than three months into his tenure as the Railway Association of Canada’s (RAC) president and chief executive officer, Michael Bourque has learned a thing or two about the rail industry that he didn’t know before.

“The No. 1 surprise for me is how competitive this business is,” he says. “I came from the shipper community and the myth is that there is no competition in rail.”

Bourque — who before joining RAC in early April was vice president of external relations for the Chemistry Industry Association of Canada — still is learning the industry and believes he has a lot more to absorb. Rating his rail knowledge coming into the job on a 1-to-10 scale, “it was a 1,” says Bourque, 50.

What he’s deciphered so far is the importance and sophistication of Canada’s short lines relative to the advancement of freight rail along with CN and Canadian Pacific. RAC represents the interests of 50 freight and passenger railroads in Canada, including the Class Is and about 40 short lines.

“Short lines are dynamic, and they’re evolving,” says Bourque. “The Class Is have evolved to focus more on pick ups and deliveries to and from ports. That’s meant the short lines needed to evolve, as well.”

Short lines can provide all kinds of services beyond transportation, he says. For example, the RAC in May named Central Manitoba Railway (CEMR) the winner of its 2012 Marketing Award for providing a mobile fuel-blending system that enables customers to precisely blend diesel with biodiesel and allows fuel suppliers to comply with Manitoba's biofuels act, which mandates a 2 percent blend.

The 118-mile short line created a mobile liquid blending and distribution unit designed to blend liquids at a rate of 1,200 liters per minute. CEMR receives biodiesel from the United States via CP and blends it with low-sulfur diesel at its transportation center.

CEMR had the “flexibility and innovative capacity” to solve a problem that otherwise would have resulted in significant modifications to existing fuel processing operations and possible delays in meeting Manitoba's biodiesel mandate, Bourque said when the award was announced.

There are other “fantastic stories” in Canada’s rail industry the association can promote, as well, Bourque says.

“The industry is about to take off and is poised for growth. Canada is expecting a free trade agreement with Europe by the end of the year,” he says. “We have products and services that the world wants.”

Bourque hopes to rely on his expertise, which includes 25 years of experience in government affairs and communications, to make the RAC more of an industry promoter and supporter. He previously was director of federal public affairs for Bayer Inc. and served as an executive in federal public service for the Department of Communications and the Privy Council Office.

“The RAC is all about advocacy, and that’s what I do,” says Bourque. “There has to be a strong policy foundation at the association. We’re upping our game on advocacy even more.”

There is strong public support for rail in Canada — a recent opinion poll showed 87 percent of the respondents back investments in freight-rail infrastructure, he says.

“Rail is seen as the safest and most environmentally friendly mode versus trucks, buses, cars and planes,” says Bourque.

But there still are many people in Canada who don’t know much about rail. Bourque cites as an example a gentleman who recently asked him about the potential for electrifying freight railroads. Electrification is a model that works well in Europe, “but it wouldn’t work well here,” he says.

“We want to educate Canadians more,” says Bourque.

He has other immediate goals, too. Among them: developing a three-year strategic plan by 2013’s end; devising succession plans because several RAC workers plan to retire in the coming years; and addressing federal grade crossing regulations.

Bourque’s No. 1 objective is ensuring that RAC has a voice in federal legislation that soon will be crafted as a result of a freight-rail service review that began in 2008. In late June, a federally appointed facilitator released a final report that includes five recommendations aimed at improving freight-rail service. One recommendation: that the government should make a service agreement template available to stakeholders as a guide when negotiating a pact.

However, some shippers are advocating regulation instead of supporting the commercial approach encouraged by the facilitator, says Bourque.

“We’re trying to get the word out that railroads need a series of market-based commercial agreements in the marketplace versus regulation,” he says. “We can demonstrate that the service railroads are providing is different than five years ago and their relationship with the supply chain is different than five years ago. Railroads are more efficient and most customers are happy.”

As the association’s leader, Bourque is “humbled” to follow in the footsteps of Cliff Mackay, who led the RAC for about six years until he died on Jan. 26.

“I knew Cliff. He was a very well-respected executive,” says Bourque. “People from all industries have told me he was their mentor.”

Holding a senior position for 12 years and being prepped to assume a leadership post — as happened to Bourque prior to joining the RAC — will help him as he attempts to fill Mackay’s shoes. His breadth of experience will help, too.

“The RAC was a great fit for my skill set,” says Bourque.


Browse articles on Railway Association of Canada Michael Bourque short lines Central Manitoba Railway CN Canadian Pacific

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