October 9, 2014

Supply chain engagement to mitigate weather-related issues: CN VP, Eastern Region

Canadian Shipper

BURLINGTON, Ont.–Railroading is tough in winter, no matter where or who you are, was the message delivered by John Orr, VP, Eastern Region, with CN Rail. Orr was a speaker at the 28^th Annual transportation conference October 8 in Burlington, Ontario.

Orr described operations during the winter of 2013-2014, one of the worst on record, and spoke out in support of all CN employees.

“I could summarize it by saying we have the most dedicated employees out to deliver goods. CN is one of the most IT-centric companies in Canada. But what it comes down to is It’s tough in winter, no matter where you are,” he said.

CN creates a winter operating plan in consideration of the fact its North Ontario division represents 53% of its gross tonne-miles through “some of the toughest, most isolating environments.”

“Toronto is really the hub so it has to function. Our terminals are actually accelerators of traffic. We rely on those terminals to scrub out. But If Toronto goes, so goes the railway,” he said.

“In winter typically there’s an erosion, but the traffic that kept going was significantly more than the years before. It tells me we really have a good plan. What do we have to do differently? We’re the most northerly railway in North America. We operate in arguably the harshest conditions. But North America didn’t shut down,” said Orr.

During the winter of 2013-2014 CN saw reduced train speeds of -5.3% vs. a -9.2% industry average. For terminal dwell, CN experienced -11.5% vs. a -24.1% industry average, Orr said.

“I attribute this to the dedication of employees out there chipping ice to spot the customers. It’s how we drove the supply chain in the perfect storm.”

On the regulatory front, Orr said that “we run the danger of reality being eclipsed by politics, particularly in the grain groups. We’re not in a position in Eastern Canada to let Western politics dominate the discussion. We want to make sure our issues with Eastern Canada are on the table with the CTA changes,” Orr said.

In the meantime, CN continues to make investments in process improvements (data mining, etc), and supply chain engagement.

“The winter of 2013-2014 taught us where we are most congested. We’ve made a $50 million investment across the NOD, and we’ve gotten deeper into our engagement with our employees,” Orr said.