(The Canadian Press circulated the following article on November 8.)
MONTREAL — Canadian National Railway, CP Rail and Norfolk Southern Railway have reached a track- and train-sharing deal to speed up freight transport between Eastern Canada and the eastern United States.
The arrangement will give CN and Norfolk “a seamless, direct north-south routing” over CP Rail’s lines south of Montreal that will slice as much as two days’ time off about 20,000 shipments annually, the companies said Monday (TSX:CNR, TSX:CP).
Financial details were not disclosed.
Effective Nov. 19, the deal will also increase traffic density and revenues on a CP Rail subsidiary, the Delaware and Hudson Railway.
CN and Norfolk traffic destined for the eastern U.S. will move in CP Rail trains on CP Rail’s line between Rouses Point, N.Y., and Saratoga Springs. The cars will then move in Norfolk Southern trains over CP Rail’s line between Saratoga Springs and the Norfolk connection near Harrisburg, Pa.
The new agreement will cut 530 kilometres from the routing used by CN and Norfolk, in which freight traffic currently goes through Buffalo, N.Y.
“This three-railroad agreement will benefit both customers and railroads,” CN chief executive Hunter Harrison said in a release.
“First, 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 second, it will enable the participating railroads to improve the utilization of their networks and locomotive and car fleets.”
CP Rail CEO Rob Ritchie said the arrangement “takes costs out of the rail industry by placing freight traffic on the most efficient routing without regard to ownership.
“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.”