CPKC reports mixed progress on service recovery

WASHINGTON — Canadian Pacific Kansas City’s local service in former Kansas City Southern territory continues to improve after a troublesome May 3 computer system cutover, but merchandise train on-time performance declined last week and dwell remains stubbornly high at yards in Louisiana and Iowa.

CPKC told federal regulators this week that it still expects service to return to normal levels by the second half of July.

“Overall, CPKC’s ability to meet the needs of its customers on the legacy-KCS network has shown broad improvement. CPKC has made strong progress towards consistent [first and last mile] performance … enabled by greater familiarity on the part of field operations personnel and customers with the new CPKC systems and processes rolled out for the May 3 transition,” the railway said in its weekly update to the Surface Transportation Board. “As a further manifestation of these improvements, the volume of calls and emails into CPKC’s customer support centers has trended steadily down towards normal levels.”

Local service performance reached 91% last week, up significantly from the May 23 low point of 66.3%.

CPKC said the usual traffic lull during the Fourth of July holiday week helped relieve pressure on its system in former KCS territory. “With the holiday now behind us CPKC anticipates building momentum in the yard inventory (dwell), corridor fluidity, and train speed improvements that will drive improvement in Manifest OTP performance,” the railway said.

Boosting manifest on-time performance from the current 56% is a priority, CPKC said. Manifest train on-time performance was around 75% prior to the information technology system cutover.

Chemical shippers are still feeling the impact of CPKC service delays.

“CPKC is working with their customers. So they are at least responding and working to resolve the issues,” says Jeffrey Sloan, the senior director of regulatory affairs for the American Chemistry Council, the trade group representing petrochemical companies. “But it’s putting a lot of extra burden on the shippers to make sure things are right.”

The CPKC delays have prompted some chemical producers to keep their customer commitments by diverting shipments to trucks or sourcing products from plants on other railroads. In either case, the options are limited and diverting loads adds cost.

“This is not a blip. This has been a pretty significant problem for a large swath of companies that had business on the legacy KCS lines,” Sloan says.

ACC members are hopeful — but not confident — that CPKC operations will return to normal by the end of the month, Sloan says.

Senior CPKC operating officials remain stationed at former KCS yards, including Shreveport and New Orleans, La.; Beaumont and Port Arthur, Texas; and Jackson, Miss. Dwell at Shreveport – the key hub on the former KCS network – was 59.7 hours last week, while cars averaged 52.4 hours at New Orleans. Both figures are well above the normal range.

Regulators last month required CPKC to file a service action plan in response to the congestion, delays, and missed switches that mounted in Louisiana, Texas, and Mississippi after the CP operating system replaced the old KCS system.