NEW YORK — According to the Canadian Press, the Canadian National Railway Co. is recruiting change-oriented managers and trying to avoid the industry’s past “in-breeding,” CN chief executive officer Paul Tellier says.
“We recruit from right, left and centre,” he told analysts at Merrill Lynch & Co. Inc.’s ‘s global transportation conference in New York. “We do not limit ourselves to the rail sector, where there has been too much in-breeding.”
CN wants “promoters of change, as opposed to defenders of the status quo,” and is investing time and money in recruiting new people and assessing current staff, he said.
He added that staff improvement includes creating a good succession plan at every level of the organization.
Mr. Tellier said CN is a very old, traditional, natural industry. “It has to change. We’ve got to gain back market share from the trucks. If we don’t grow our revenues, we’re not going to have a future as an industry.”
On Tuesday, CN reached a tentative deal with North America’s oldest labour union — a three-year pact that would give 415 U.S. locomotive engineers an hourly wage for the first time. Members of the Brotherhood of Locomotive Engineers work on CN’s former Illinois Central properties. The deal would see engineers paid an hourly wage, replacing the mileage- and rule-based compensation system that dates from the era of the steam locomotive.
CN hopes the change spreads to Canada, and Mr. Tellier described it as “moving wages up in return for flexibility of deployment of employees.”
He also said yesterday that the former Crown corporation is taking a “very cautious” outlook for the economy in the near term. “The recovery is uncertain. There are some pockets of weakness. There are some business units that are very strong, while others are very difficult to read.”
While CN finds strength in handling diverse commodities over a huge area — North America — Mr. Tellier noted price pressure from customers, including the forest products companies on both sides of the Canada-U.S. border. “And let’s face it, truckers have given us one hell of a beating [in competition] over the past 40 years.”
CN’s business is 58 per cent in the United States or cross-border, 24 per cent across Canada and 18 per cent involving imports and exports at the east and west coasts.
Its shares shares closed down 37 cents to $76.28 on the Toronto Stock Exchange yesterday.