On the same day CN announced plans for a new chief executive officer, the Class I railroad also announced it would offer $250,000 to Michigan Technological University's Rail Transportation Program to create the CN Rail Transportation Education Center (CN RTEC).
CN RTEC will open in fall 2009 and function as a central location for student, faculty, and industry collaboration, MTU said in a statement. It will also provide education and research facilities for the Rail Transportation Program, including computer workstations with rail applications, a reference library, and online learning technologies.
"CN's decision to support the CN Rail Transportation Education Center is an integral part of the development of this program and has helped ensure its future success. It is a pleasure to be able to share with CN the excitement we have for the Rail Transportation Program," said Michigan Tech President Glenn D. Mroz.
Jim Vena, CN's senior vice president, Southern Region, said: "We are very pleased that our donation will help today's youth become tomorrow's railroaders--the people who will shape the future success of our company and the North American economy. Few universities in the United States can produce students with such high-caliber education, specifically in railroad transportation, as Michigan Tech does. Michigan Tech engineering graduates arrive at CN well equipped to start working for the railroad."
The 18-month old Rail Transportation Program (RTP), directed by Pasi Lautala, is designed to attract university students to rail industry careers.
Michigan Tech's RTP attracts students from a wide range of degree programs and includes courses about rail transportation and engineering, as well as urban rail transit. The program currently offers three rail-related courses. Through its Summer in Finland program, it is the first rail transportation education program to integrate a strong international study component into a multi-disciplinary thrust in rail education.
The RTP has begun an initiative to establish a multi-disciplinary certificate in rail transportation and engineering. The university is also working with its industry partners to expand opportunities for student and faculty participation in real-world rail development through sponsored projects and research.
Ansaldo STS, through its subsidiary Ansaldo STS USA, has received a $25.8 million contract from the Long Island Rail Road (LIRR) for the LIRR Harold and Point CIL’s (Central Instrument Location) Interlocking project.
This project, part of the LIRR East Side Access program, replaces the current vital relay-based interlocking control system with a MicroLok vital microprocessor-based system.
This switch to a microprocessor-based technology follows on the success of other upgrades ASTS USA has implemented for the LIRR using the MicroLok II platform, including the Wood, Jamaica, Amityville, and Wantagh interlockings.
Harold Interlocking, located just east of the East River which separates Manhattan from Queens, handles virtually all LIRR passenger train movements on the system, as well as Amtrak trains traveling between New York and Boston on the Northeast Corridor.
The Port Authority of New York & New Jersey has chosen RailComm to provide a wireless remote control switch heater system for the PA’s Air Train serving John F. Kennedy International Airport in New York.
The turnkey control system will include the RailComm switchheater controllers communicating to a central office via a dedicated data radio network. RailComm’s Domain Operations Controller (DOC®) System resides in thecentral office and provides the operator with a user interface to control the20 switch heaters. RailComm says the system reduces energy costs, while also increasing safety and reliability.
The DOC® software-based control system is an command, control, communications, and information (C3i) server-based platform that supports a wide variety of integrated solutions for indication, control, access, and distribution of critical operational data.
Canadian National Chairman David G. A. McLean announced Tuesday that Claude Mongeau has been selected by CN’s board of directors to succeed E. Hunter Harrison as president and chief executive officer at the end of 2009. Mongeau, 47, is CN's executive vice-president and chief financial officer; he joined the company in 1994.
In 1997, the Financial Post magazine named Mongeau one of Canada's top 40 executives under 40 years of age. In 2005, he was selected Canada's CFO of the Year by an independent committee of prominent Canadian business leaders.
"Claude is an exceptional executive and leader,” McLean said in a statement. “He is one of the architects of CN's industry-leading financial performance and the key strategist behind the highly successful rail acquisitions that have grown CN's reach throughout North America and made it a key industry player. He has a keen appreciation of the power of CN's unique business model--Precision Railroading-- and will be supported by an outstanding team of railroaders."
Said Mongeau (far left, accepting congratulations from Harrison), "I deeply appreciate the board's confidence and I look forward to leading CN. I am excited about the company's future and firmly believe market trends strongly favor the growth of rail transportation. CN is superbly positioned for the future, thanks to the work of Hunter Harrison and our executive team, and I am committed to fulfilling that potential by continuing to drive innovation, greater efficiency and better service for our customers."
Harrison, 64, has served as CN’s chief executive since Jan. 1, 2003. Prior to that he served as CN's executive vice-president and chief operating officer. He was named Railway Age’s Railroader of the Year in 2002; he also was named Canada's CEO of the Year by Report on Business magazine.
In a statement, Harrison said, “Claude is a key member of my management team at CN, and I have the greatest confidence in his abilities. I've worked very closely with him on every aspect of the business. Over the next few months Claude and I will work very closely together to ensure a seamless transition at year-end."
Canadian National late Monday reported its first-quarter results, with net income of C$424 million, or 90 Canadian cents per diluted share, compared with C$311 million, or 64 Canadian cents per diluted share, reported in the first quarter of 2008.
Excluding one-time items, CN recorded earnings of C$302 million, or 64 Canadian cents per share, but even those results beat Wall Street analyst expectations of 60 Canadian cents per share.
CN revenue fell 4% for the quarter compared with the 2008 quarter, while freightcar loadings fell 16%. Operating expenses fell 2%, assisted in part by falling fuel prices. Operating income declined 8%, and the railroad’s operating ratio rose 1.2 points to 74.1%.
The railroad noted special circumstances included a gain of C$157 million, or C$135 million after-tax (C$0.29 per diluted share), from the sale of a railway route to Toronto’s GO Transit, and the C$46 million expense related to CN's acquisition of the Elgin, Joliet and Eastern Railway Co. in the U.S. in late January, among other items.
The strengthening of the U.S. dollar affected the conversion of the CN's U.S. dollar-denominated revenue and expenses, increasing first-quarter 2009 net income by approximately C$30 million, or C$0.06 per diluted share.
In a statement, E. Hunter Harrison, president and chief executive officer, said, "Economic conditions during the first quarter of 2009 were challenging. Our traffic declined sharply as production cuts andreduced imports and exports coursed through the North American and global economies. But we responded quickly to the downturn, using the discipline of our Precision Railroading model to reduce expenses while maintaining quality service. Among other measures, we reduced train starts and cut discretionary expenditures.
"Amid these challenges, the weakening of the Canadian dollar vis a vis the U.S. dollar was a shock absorber, and we remained focused on generating increased shareholder value through the sale of our Weston subdivision in Toronto,” Harrison said.
Harrison also noted, “I am particularly proud that we completed the acquisition of the EJ&E during the quarter. The route-around-Chicago represented by the EJ&E, and the upgrades we plan for the line in the next three years, will pay dividends to CN in the years ahead through faster transit times, improved productivity, and better service to customers."
At the request of two U.S. Senators who hold key committee posts on transportation, the Surface Transportation Board has agreed to indefinitely postpone hearings on rail competitive-access issues that it had scheduled for May 18-19 in Washington.
Sen. John D. Rockefeller (D-W.Va.), chairman of the Committee on Commerce, Science and Transportation, and Senator Frank R. Lautenberg (D-N.J.), chairman of the Subcommittee on Surface Transportation, Marine Infrastructure, Safety, and Security, asked the STB in a letter dated April 17 to "refrain from holding hearings to examine policies related to competitive access or bottleneck rates before the Commerce Committee has had an opportunity to conduct its legislative reviews" of issues related to Surface Transportation Board reauthorization.
The STB said its hearing had been planned as "as public forum to allow interested parties to comment on the current issues stemming from the agency's bottleneck and competitive issues decisions, the effect on rates and services these decisions have had, and the possible implications of changing these policies."
Acceding to the Senators' request, the board said in a decision late Friday that interested parties "should withhold written testimony until a new schedule is issued."
The Railway Supply Institute, joined by the OneRail Coalition and Women in Government Relations, will present a one-day symposium entitled Selling to America’s Railroads: Freight, Intercity and High Speed Rail Development–How Stimulus Funds Will Be Spent on Rail. The symposium is Thursday, May 7, 2009, 8:00 a.m. to 3:00 p.m., Phoenix Park Hotel Ballroom, 520 North Capitol Street, NW, Washington, DC 20001.
Participants will hear from government authorities regarding the availability of stimulus money for rail. Along with flexible spending money available for freight rail projects, some $9.3 billion has been committed toward intercity and high-speed passenger rail development. The U.S. Department of Transportation has issued a strategic plan on how to use those funds to improve/deploy high speed rail, outlined by President Obama April 16. Discussion will focus on what this means for rail and rail suppliers. The cost to RSI and WGR members is $150 per person and includes breakfast and lunch ($200 for non-members).
Speakers on the agenda include: Karen Rae, deputy administrator, Federal Railroad Administration; Stephen Flippin, director of Federal Affairs, CSX Corp.; Mike Rock, vice president of External Relations, Union Pacific; Darrell Wilson, Norfolk Southern assistant vice president, Government Relations; Frank Busalacchi, secretary of transportation for the state of Wisconsin’s Department of Transportation and also chair, States For Passenger Rail; and Donald Itzkoff, partner, Nossaman LLP, and also former FRA deputy administrator.
Contact RSI’s Nicole Brewin at (202) 347-4664, or email her at firstname.lastname@example.org. Agenda information and registration forms are available at www.railwaysupply.org/convention/Selling2009.aspx.
Huron Central Railway could shut down by year's end if the Ontario provincial government doesn’t provide capital infrastructure assistance, railway President Mario Brault said. Huron Central has sought funding since 2006.
Canadian Parliament member Tony Martin says a strong case can be madefor infrastructure investment to aid the line. "This is a project that is shovel ready and will contribute to the profitability of rolling stock operators in our area," Martin said. "If we lose Huron Central, then we lose the potential for passenger service to be there and it will have adetrimental impact on our Northern Ontario industries."
Huron Central Railway, roughly 190 miles in length, links Ontario’s Sudbury with Sault Ste. Marie, the latter bordering its U.S. namesake city in Michigan. Prior to 1997, Canadian Pacific operated the line; Grenwich, Conn.-based Genessee & Wyoming, Inc., is the current parent of the short line.
Huron Central estimates that approximately C$33 million (US$26.7 million) is required to rehabilitate the route. The federal government has said it will contribute its share of infrastructure funding if the province matches the funding.
But so far Ontario hasn’t made any commitment to Huron Central or to the province’s short line industry in general. "Huron Central is just one of the many short lines that will disappear if infrastructure investment isn't made very, very soon," Brault said. "That's the fate we're facing if we don't get some help."
Brault said that Quebec, partnering with the federal government, last year agreed to provide C$75 million (about US$61 million) in short line rail assistance within that province.
The Surface Transportation Board Friday noted Florida’s Department of Transportation has filed a “verified notice of exception” to acquire 61.5 miles of rail right-of-way owned by CSX Transportation located in five central Florida counties. FDOT seeks to acquire the route to establish "SunRail" regional rail service on the line centered in Orlando; CSX would remain active as a freight operator on the route.
The filing comes even as Florida legislators continue to debate the merits of FDOT’s intent, with many expressing concerns over liability issues and some still convinced central Florida does not require regional or commuter rail service. A key state legislative committee hearing was delayed until this weekend, one industry source tells Railway Age; rail proponents fear the delay threaten legislative approval.
Despite such uncertainty, FDOT’s submission asserts, “The transaction is scheduled to take place on June 30, 2009 (after the May 3, 2009 effective date of the exemption).”
Besides FDOT and CSX, Amtrak and a short line, Florida Central Railroad Co., operate over portions of the route to be purchased; FDOT’s submission to STB affirms that those tenants will continue to operate on the route.
The Good Friday holiday, added to ongoing bad weather in the Midwest and a struggling economy, pushed rail freight traffic numbers down for the week ended April 11, compared to the comparable week in 2008, the Association of American Railroads said.
U.S. freight carload traffic fell 24.5% from the comparable week last year, with loadings down 22.5% in the West and 27.3%. Intermodal volume fell 21.6% from last year. Volume of an estimated 26.4 billion ton-miles was off 23.7% from the 2008 level.
Canadian freight carload traffic fell 28.3% for the week compared with the year-ago period, while intermodal declined 24.6%. Mexico’s two major railroads reported freight railcar volume down 29.6%, while intermodal plunged 39.3%.
Combined North American rail volume for the first 14 weeks of 2009 on 14 reporting U.S., Canadian, and Mexican railroads was down 17.7% from last year’s first 14 weeks; combined intermodal was down 15.6%.