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Will Rail Freight Service Benefit From Better Technology?

Posted April 03, 2019

Under Logistics & Supply Chain Issues

(Jim Blaze – FreightWaves)

Today, freight railroading has the opportunity to use two business processes to support better customer rail freight service, improve safety and generate higher returns for railroad investors. The senior management of North American railroads can integrate the benefits of precision scheduled railroading (PSR) with the robust new private communications networks and two- to four-meter accuracy of positive train control (PTC) technology.

PSR seeks to improve return on investment with cargo delivery that is more “truck-like” in terms of reliability. The initial PSR results have been financial in nature. Shareholders, rather than freight customers, are receiving the early PSR benefits in the form of higher dividends and increased stock buybacks.

Leaders like Canadian National (CN) chief executive officer Jean-Jacques Ruest are seeking a balanced outcome of increased customer service and returns to shareholders. At a recent Next Generation conference, Ruest stated that the emphasis on PSR cost savings is not sufficient to grow CN’s railway business. He is taking a marketing approach instead of just a financial one. Click here to read more.