WASHINGTON — The Canadian Pacific-Kansas City Southern merger threatens to degrade intermodal service on the Meridian Speedway that serves as a shortcut between the Southeast and Southwest, Norfolk Southern told federal regulators this week.
NS and KCS currently operate interline intermodal trains over the Meridian, Miss.-Shreveport, La., joint venture. KCS handles the NS trains over its Shreveport-Wylie, Texas, main line on a haulage rights basis.
CP and KCS originally projected that the merger would produce no growth on the KCS route from Shreveport to Wylie, the location of KCS’s intermodal terminal outside Dallas. But NS says CP’s amended merger application shows that a combination of significant growth and operational changes would hurt NS’s intermodal service linking Wylie with points in the Southeast, including Atlanta, Charlotte, N.C., and Jacksonville, Fla.
Canadian Pacific Kansas City would launch a new pair of trains between Wylie and Shreveport and annual tonnage on the route would rise by between 62% and 73%. CP also projects that post-merger the line will handle more bulk traffic. NS says these changes would strain capacity between Wylie and Shreveport.
In addition, CPKC’s operating plan proposes tacking merchandise traffic onto the NS intermodal trains that operate in the Wylie-Shreveport-Meridian corridor, which NS says would push them over siding length and extend transit times due to the need to pick up and set out cars en route.
Merchandise from KCS trains M-DASH (Dallas-Shreveport) and M-SHNS (Shreveport-NS at Meridian) would be added to the eastbound intermodal train, which carries KCS symbol I-DAAT2 but would be called 166 on CPKC. Westbound intermodal train I-ATDA2 would include merchandise traffic that now moves on M-NSJA (Meridian-Jackson, Miss.), M-JASH, and M-SHDA and receive new symbol 167.
The combined trains would run more than 13,000 feet long, NS says, citing current average lengths of the individual trains. The single-track KCS Wylie-Shreveport main has 10 sidings, with the three longest ranging between 11,190 feet and 11,987 feet. This means every other train operating on the line would have to hold in sidings while the new trains passed, NS says.
CPKC does not have capacity expansions planned for the Meridian-Wylie route, NS notes.
“If existing rail service deteriorates on the Meridian-Wylie Route, a significant portion of the intermodal freight that NS moves to or from the on the route (particularly NS’s premium and less-than-truckload … freight) is at risk of diversion to highway if the existing rail service deteriorates,” NS told the board.
NS asked the board to condition approval of the CP-KCS merger on enforcement of CP’s promises to support KCS’s existing interline routes. It also asked the board to make CP commit to making “no significant detrimental changes to current operations on the Meridian Speedway.”
NS repeated its request for trackage rights between Shreveport and Wylie that would kick if CPKC suffered a major service failure and only if NS elects to exercise its option to purchase the Wylie terminal from KCS. They would apply only to NS intermodal traffic moving to and from Wylie.
NS also raised concerns about growth at Wylie – both from NS and CPKC volume – overwhelming the terminal. NS’s lifts at the terminal grew 28% between 2019 and 2021.
