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11/8/2004



Rail News: Rail Industry Trends

From two- to three-teamer: CN teams with NS, CPR to improve eastern Canada-to-eastern U.S. service



Canadian Pacific and Norfolk Southern railways' agreement designed to improve service between eastern Canada and the eastern U.S. now has become a three-party pact. Today, the Class Is and Canadian National Railway Co. announced they reached an agreement under which CN and NS will obtain a seamless, direct north-south routing over CPR's lines south of Montreal, and CPR subsidiary the Delaware and Hudson Railway will generate more traffic and revenue. The railroads plan to begin implementing the plan Nov. 19.

CPR will move CN's and NS' eastern U.S.-bound traffic on its line between Rouses Point and Saratoga Springs, N.Y. NS then will move trains between Saratoga Springs and a connection near Harrisburg, Pa.

"This three-railroad agreement will benefit both customers and railroads," said CN President and Chief Executive Officer E. Hunter Harrison in a prepared statement. "It will offer CN’s existing merchandise carload customers in Quebec and the Maritimes quicker access to important consuming markets in the eastern United States, and enable the participating railroads to improve the utilization of their networks, and locomotive and car fleets."

The haulage agreements will shave 330 miles off routes now used by CN and NS, and reduce transit time about two days.

"This is an important initiative that takes costs out of the rail industry by placing freight traffic on the most efficient routing without regard to ownership," said CPR President and CEO Rob Ritchie. "It also creates a significant source of new earnings for our Delaware and Hudson subsidiary, and is another major milestone in improving the profitability and value of this part of our network."


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