CN says its precision railroading model, innovations improve rail service

CN said today that customer-focused innovation and balanced accountability among transportation partners are the keys to improving the effectiveness of Canada's logistics supply chain. CN, in a submission to the Rail Freight Service Review panel appointed by the Canadian government, said hard facts compiled for the panel establish the quality of CN's rail transportation product, most notably in terms of hub-to-hub transit time performance.

At the same time, CN said
it is committed to do a better job of partnering with its customers and is
taking concrete action to further improve service by:

• Strengthening the "first
and last legs" of traffic movements that are critical customer "touch points,"
with measures such as improving empty car supply and customer ordering
flexibility;

• Re-designing its
bulk service offering, with precision railroading innovations such as the
implementation of a new scheduled grain transportation plan for Western Canada;

• Streamlining
demurrage rules to address customer complaints about bunching and car placement
outside switching windows, and

• Engaging its
customers with better communication and faster resolution of service issues
through a new marketing organization and customer service function.

Claude Mongeau, president
and chief executive officer, said: "CN’s customer-centric innovations are being
driven by normal commercial incentives in a market place where there is
substantial and effective competition, both within the rail sector and across
transportation modes. CN understands that, even with good rail service,
customer issues may arise from time to time. That’s why we are again urging
broad adoption of mediation under a Commercial Dispute Resolution model. Clearly,
making further improvements to the logistics system does not require that more
regulation be added to an already robust Canadian regulatory regime." 



CN said the fact-based
study prepared for the panel by QGI Consulting Ltd. on railway fulfillment of shipper
demand and transit times found no systemic market structure issues within the
Canadian rail industry. Moreover, the study found no difference in rail service
delivery, whether the customer is large or small, located on a main line, a
secondary or shortline, or whether the customer is served exclusively by one
carrier or has access to other rail service providers. This is a very important
finding.

CN urged the Review panel
to recognize another critical conclusion of the QGI report – a conclusion CN
shares – that the reliability of supply chains is not only influenced by railways,
but also by the performance of shippers and receivers, terminal operators, port
authorities, truckers and steamship lines.

Mongeau said: "Railways
cannot be arbitrarily held responsible for all failures in the system.  Good transportation service depends on
all supply-chain participants working as much as possible in a synchronized
manner. Failures often happen, for instance, because vessels are late or
waterfront terminals are clogged. Balanced accountability is best served by
allowing normal commercial incentives to inject the discipline required of all
participants.

"The de-regulation of the
rail industry has been a true success in Canada," he said. "It helped to revive
the industry, improve service, generate competitive rates for customers, and it
encouraged railways to step up investment in their networks. That’s a powerful
story and why CN is calling on the Review panel to recommend staying the
course."