A pedestrian crosses in front of a stopped train -
Date unknown John Lucas.
24 December 2014
Railroads Add Workers and Engines
Canada - Canada's two biggest railroads are putting extra
workers on call, adding locomotives, and readying heaters to thaw frozen switches to
prevent another winter of icy, profit sapping gridlock.
Canadian National Railway is strengthening its network, increasing employees, and
engines to keep trains running smoothly.
Canadian Pacific Railway is putting additional staff on standby, redeploying some
equipment to "strategic" locations, and building new sidings in case
below-average temperatures halt cargoes.
"Last year was an extraordinary winter," Canadian Pacific chief operating
officer Keith Creel said.
"The rolling equipment, the air-brake systems, the steel that you ride the trains
on, the locomotives that have to operate at 40 below zero, there are certain things
that just don't work when it gets this cold."
Unseasonably frigid weather in 2013-14, with temperatures falling to as low as minus
37 degrees Celsius in Central Canada, forced both railroads to run slower and shorter
trains and spend more on fuel and other items.
The turmoil also caused congestion in Chicago, which handles about one-quarter of
Canadian National's traffic and recorded its third-highest snowfall on
record.
Winter-related costs such as snow removal trimmed Canadian Pacific's first-quarter
profit by 30 cents to 35 cents a share, equivalent to as much as $61
million.
They also depressed profit for the period at Canadian National by about $50
million.
As a result, Canada's railroads "are in better shape today than they were 12
months ago, if we were to have a repeat of last winter," Cam Doerksen, an analyst
at National Bank of Canada Financial, said.
"The rails have learned some lessons and deployed some additional assets where
they fell short last year.
Given the difficulties that existed last year, both CN and CP managed pretty
well."
The first quarter marked each carrier's worst share performance in 2014.
Canadian National rose 2.6 percent in the period en route to a 30 percent gain this
year through Monday, while Canadian Pacific gained 3.1 percent in the first three
months in Toronto.
Its 2014 advance was 39 percent.
Frederic Tomesco.
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