INDEPTH: CN
Canadian National:
From coast to coast to coast
Justin Thompson, CBC News Online | Updated November 25, 2003
CN freight train hauling steel bars near Bayview, Ontario. (Photo courtesy CN)
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It's Canada's largest railway and growing.
Since being privatized in 1995, Canadian National has morphed into a lean, mean hauling machine in an increasingly competitive North American market. Describing itself as "the only railway in North America to cross the continent east-west and north-south," Canadian National is considered on both sides of the border to be a continent-wide success story.
Much of that success has been attributed to former president Paul Tellier, who halved the former Crown corporation's workforce through massive job cuts in the 1990s and made strides in increasing reliability. His coup came in 1999 when CN reached a deal to merge with Illinois Central, extending CN's reach south to the Gulf of Mexico.
Tellier tried to take expansion a step further one year later with a proposed merger with Burlington Northern Santa Fe to form North America's largest railway. Both companies agreed to the merger in principle, but the deal was blocked by the U.S. Surface Transportation Board, which imposed a 15-month moratorium on new rail mergers.
While both companies challenged the STB ruling, it was upheld and the deal scuttled. In Sept. 2001, CN continued its expansion, albeit on a smaller scale, by snapping up Wisconsin Central.
By December of the following year, Tellier was succeeded as president by his former second-in-command, E. Hunter Harrison, a seasoned railroader originally acquired in the deal with Illinois Central. Harrison has continued in Tellier's footsteps, actively pursuing takeovers. His first coup was the railway assets of Great Lakes Transportation in Oct. 2003, further expanding CN's north-south infrastructure. That was followed one month later by the acquisition of publicly owned BC Rail - Canada's third-largest railway - on Nov. 25.
See below for a timeline of the company.
Timeline
CN operates approximately 1,500 locomotives and 61,500 freight cars. Locomotives in Symington Yard, Winnipeg, Manitoba. (Photo courtesy CN)
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Nov. 25, 2003
CN announces the acquisition of publicly owned BC Rail Ltd. for $1 billion in cash. In the deal, CN picks up the shares of Canada's third-largest rail company along with the right to operate on BC Rail's roadbed under a renewable 60-year lease. The roadbeds will remain in public hands, while CN will take over rail transportation and maintenance.
Oct. 20, 2003
CN announces the acquisition of publicly owned BC Rail Ltd. for $1 billion in cash. The deal goes against Premier Gordon Campbell's 2001 election campaign promise not to sell the railway. In the deal, CN picks up the shares of Canada's third-largest rail company along with the right to operate on BC Rail's roadbed under a renewable 60-year lease. The roadbeds will remain in public hands, while CN will take over rail transportation and maintenance.
Dec. 13, 2002
E. Hunter Harrison takes over as president of CN. Previously he was CN's executive vice-president and chief operating officer, as well as president and chief executive officer of Illinois Central Railroad before its merger with CN in 1999.
Sept. 7, 2001
U.S. Surface Transportation Board (STB) approves CN's acquisition of Wisconsin Central for $1.2 billion US. The deal bolsters CN's so-called NAFTA network – the mainline railway connecting Chicago, Ill., and Superior, Wis. with CN's transcontinental network in Canada. The acquisition goes ahead on October 17.
July 20, 2000
CN and Burlington Northern Santa Fe say their proposed merger is officially dead after the U.S. Surface Transportation Board (STB) imposed a 15-month moratorium on new rail mergers. If combined, the companies would have formed the largest railway in North America.
July 1, 1999
CN merges with Illinois Central after acquiring all of its common stock for $2.4 billion US. Key to the deal is IC's trackage, which links Chicago, Ill., to New Orleans, La. The deal means CN now spans from central Canada to the Gulf of Mexico as well as from Canada's Atlantic coast to the Pacific.
November 17, 1995
Citing a need to streamline operations and raise funds for future growth, the Canadian government puts CN on the auction block. Shares of the company are listed on the New York Stock Exchange and Toronto Stock Exchange. The government takes $2.2 billion in the sell-off.
1995
CN opens the St. Clair Tunnel between Sarnia, Ont., and Port Huron, Mich., allowing unimpeded access to Chicago for large multi-level trains.
1992
Paul Tellier, a lawyer and clerk of the Privy Council, takes over as president of CN.
June 1976
CN opens the world's largest freestanding structure – the CN Tower. Also this year, CN creates VIA Rail, which becomes a Crown corporation two years later.
1967
CN's last "school-car" removed from service.
1960
Last CN steam locomotive removed from service, completing the dieselization of the network.
1933
CN's broadcasting interests are sold to the Canadian government and are handed over to the Canadian Radio Broadcasting Commission (CRBC).
1928
CN's first mainline diesel-electric locomotive goes into service.
July 1, 1923
CN officially takes over the Grand Trunk Pacific, a 4,800-km system running from Winnipeg to Prince Rupert, B.C.
Also this year, CN begins making radio broadcasts.
1926
Canada's first "school-car" goes into use in northern Ontario. The converted passenger car is used as a portable schoolhouse and visits communities too small or remote to have schools of their own.
June 16, 1919
Canadian National Railway Company created.
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| QUICK FACTS: |
Canadian National: Vital stats
Chairman and chief executive officer: E. Hunter Harrison
Revenues (2002): $6.1 billion + (57 per cent from U.S. domestic and cross-border traffic, and 24 per cent from Canadian domestic traffic)
Route kilometres (Canada and U.S.): 28,706 (2002)
Car loads: 4,164,000
Diesel consumed: 13.9 billion litres
Employees (2002): 23,190 (In 1992, CN employed 36,00 people.)
System map
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| CBC STORIES: |
CN Rail buying Great Lakes railway for $500 million (Oct. 20, 2003)
CN Rail cutting more than 1,100 jobs (Nov. 27, 2002)
CN Rail gets U.S. OK for Wisconsin Central takeover (Sept. 7, 2001)
CNR buys Wisconsin Central for $1.2 billion US (Jan. 30, 2001)
CNR, CPR announce track-sharing deals (July 21, 2000)
Rail merger grinds to a halt (July 20, 2000)
CN Rail expands into the U.S. (July 2, 1999)
CN launches restructuring following merger approval (April 28, 1999)
CN cuts haven't cost safety, CEO says (April 28, 1999)
CN stock soars as workers get slashed (Oct. 21, 1998)
CN takes over Illinois Central Railway (Feb. 10, 1998)
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