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4/23/2002



Rail News: Rail Industry Trends

BNSF/KCS marketing alliance nurtures Class Is' recent affiliations


The Class Is' recent allied spirit continues. Burlington Northern Santa Fe and Kansas City Southern April 23 formed a marketing alliance aimed at growing revenue, extending their market reach in the United States and Canada, and enabling the railroads to be more responsive to shippers' rate and service requests.
The alliance also would help BNSF and KCS improve their operating efficiencies in key market areas and provide their customers expanded service options.
BNSF and KCS plan to coordinate marketing and operations initiatives in a number of target markets. For example, the railroads are developing plans to enhance shippers' competitive options in the Westlake and Lake Charles, La., regions.
The railroads also plan to coordinate operations aimed at providing improved and extended service options to grain shippers and receivers. However, BNSF and KCS plan to exclude coal and unit-train operations from the alliance, as well as any points where the Class Is are sole direct-rail competitors.
To create the alliance, BNSF and KCS had to resolve a number of operational issues, but the railroads' proximity attracted officials on both sides.
"The complementary, end-to-end nature of [both] networks, together with our mutual customer focus and development of interline service products, makes this alliance the basis for a natural partnership," said Matthew Rose,
BNSF chairman, president and chief executive officer, in a prepared statement.
The BNSF pact marks the second such venture for KCS, which in 1999 formed a 15-year marketing alliance with Canadian National Railway Co. and Illinois Central Railroad.


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