SPEAKING in Omaha on January 19, Union Pacific Chairman & CEO Dick Davidson said that operations on his 56000 route-km network were back to near normal apart from the problem-plagued line between Houston and New Orleans. Average train speed during the first week in January improved to 23·5 km/h, the best since September but lower than the 28·8 km/h of a year earlier.
Davidson admitted that UP faced a long haul before it regained the confidence of shippers, and in particular the Gulf Coast chemical industry which was hard-hit by UP’s difficulties. In heavy haul territory further north, UP succeeded in setting a fresh coal loading record in the third week of January when 6470 cars were dispatched from the Powder River Basin. This should help restore stocks at power stations which reported dangerously low reserves at the height of UP’s congestion crisis.
In the Houston area UP has proposed a joint dispatching centre for seven lines owned by itself, Burlington Northern Santa Fe and Kansas City Southern. To be run by UP and BNSF from Spring, Texas, it would manage key routes serving the Gulf Coast corridor from Brownsville, Texas, through Houston to New Orleans. Other lines would remain under the control of their owners.
Another move aimed at easing traffic flows was the launch of one-way running on February 1 between Dexter Junction, Missouri and the Houston area, cutting through Arkansas, western Louisiana, and eastern Texas. Using parallel routes, traffic is moving primarily north on UP and south on the former SP, eliminating hundreds of passing movements each day.
It is too early to judge the effects of these measures, but UP is claiming that business for the first few weeks of this year is yielding much improved results. With a fourth quarter net loss of $152m, UP badly needs good news. o