CN Railway to push for further efficiency gains

Wed Dec 11, 2013 5:03pm EST
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* CN targets operating ratio in "low 60s" over next 3 years

* Will use longer trains, fuel efficiency to boost productivity

* Sees mid-single digit percentage growth in carloads in 2014

By Susan Taylor

TORONTO, Dec 11 (Reuters) - Canadian National Railway Co , the country's largest rail operator, said on Wednesday that it aims to improve its industry-leading operating efficiency over the next three years, even as it carries more goods.

The Montreal-based railway estimates its 2013 operating ratio at about 63 percent, nearing last year's 62.9 percent, and targets a rate in the "low 60s" over the next three years.

Operating ratio measures productivity by tallying how much revenue is used to maintain operations. The lower the number, the better.

"For me, low 60s is 60.001," Chief Financial Officer Luc Jobin said at the company's investor update in Toronto.

"Anybody that can move on a big ship like this, that can move the operating ratio from 63 down to 60.001, is actually doing quite a bit of travel, and that's a lot more difficult to do ... while growing the franchise at a very good clip."   Continued...