CPKC Mexico Dwell Still in Free-Fall

Canadian Pacific Kansas City’s Sanchez Yard, near the U.S. border, continues to be on a roll. Yard dwell time fell for the fourth consecutive week, this time from 19.4 to 17.5 hours. Monterrey downticked from 30.8 to 30.5 hours, and San Luis Potosi also went in the right direction, from 7.1 to 6.6 hours on average. (Remember, dwell here is heavily distorted by the inclusion of run-through trains that only change crews without processing cars.)

Impact on Full System Metrics

Purely operationally, Mexico was a headache for CP on the back of the KCS acquisition, given the melted down state of KCSM, and you can see in the charts the impact it has had on CPKC’s velocity and dwell numbers. After KCS was added on April 14, CPKC’s full system metrics tanked and didn’t even find a bottom until the first week of September. These numbers have not been restated to show what a consolidated CPKC would have looked like prior to the acquisition, but rather the lines prior to the “Added KCS” markers show CP’s pre-merger standards. Now that Mexico appears to be in rapid repair mode, it’s enabling the full system metrics to arc back towards these standards.

Velocity and Terminal Dwell YoY Comparisons

CPKC has supplied restated velocity and dwell data back several years that pretend CP and KCS were operating a single consolidated network. We’re not using it, at least yet, to see how CP’s metrics change after KCS and KCSM were added. You can see in the chart below the detrimental impact it’s having, particularly as CP has basically added a melted down KCSM into the reporting mix. It’s now up to CP management to fix KCSM, and run KCS better, to force the dark green lines in these charts back toward the old CP standalone benchmarks. There’s finally a clear trend to the better over the past few weeks.