(Dow Jones circulated the following on April 24.)
CHICAGO — Union Pacific Corp. (UNP) said on Thursday that it was losing some business to trucking companies as customers balked at higher fuel- related rail rates.
Jim Young, chief executive of the largest U.S. railroad operator by revenue, said soaring diesel costs were forcing shippers to take a closer look at their transportation costs.
Young said some trucking companies were pricing to maintain cash flows as they struggled with their own rising fuel costs, luring some customers from the railroad.
“We are losing and have lost some business,” said Young on a call with analysts following his company’s first-quarter earnings report.
However, Young said he wasn’t concerned by the attrition, and Union Pacific still expects to raise its core prices by 5-6% in 2008, in line with plans at rival railroad operators.
Shares of Union Pacific were trading recently at $133.94, down $1.20.