CN’s winter woes

News 5 Mar 2014 by WCN Editorial

CEO Claude Mongeau tells Trans-Pacific Maritime conference this winter has been a “once in a career event”.

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The winter of 2013-2014 is not over yet, but has already been declared one of the most severe in North American history. Major cities like Chicago and Toronto have recorded extremes of temperature (below 25 degrees Celcius) for sustained periods while wind chill measurements of -50 Celcius and below have been recorded in the mid west and elsewhere.

Transport disruptions have been severe; over 40,000 flights have been cancelled due to weather in the US alone. Trucking has been disrupted by snow as far south as Atlanta and Georgia. Speaking at TPM Mongeau said CN has been particularly hard hit, and he has spent much of the winter explaining and working with customers trying to manage service disruptions.

At temperatures below minus 25 celcius CN has to begin “winter operating restrictions”. Every winter brings periods of disruption, but normally extreme cold snaps are limited to one or two days, after which CN can deploy extra resources to address backlogs. The difference this winter, said Mongeau, is the sustained nature of the cold temperatures combined with heavy snowfalls and one-off events like Toronto’s ice storm and the “Polar Vortex” that froze part of Niagara Falls.

This year CN has been operating under winter restrictions for much of December, January and February. At minus 25 Celsius the performance of air brakes on rail cars starts to fall and CN has to shorten train lengths by 35 – 70% and slow the speed of trains. This winter, said Mongeau, cold temperatures have effectively reduced its total capacity by 20%+ at times. At one point the number of “old dates”, rail cars with a dwell time of over 32 hours, reached over 14,000 units.

In response CN has added extra trains, but having more, shorter, trains on the network affects “platform fluidity”. CN typically has 75 trains operating on its network at any one point in time, each covering an average 450 miles a day. This winter it has been running 25 additional trains and average travel distance has fallen to 350 miles, resulting in “bunching” on the network.

What has helped CN throughout the winter is “supply chain enabling” strategy. This was initially developed to help CN manage demand and maximize asset utilisation. It requires data sharing and joint planning with customers to manage their demands with rail car supply and position. The close relationships that have resulted have helped CN’s customers plan around winter delays to some extent.