Letter to Stakeholders

Union Pacific is committed to providing safe, efficient and environmentally responsible freight solutions. Delivering on this promise, we support the workforce’s need for good jobs, communities’ expectations of a corporate neighbor and businesses’ growing demand for transportation. As the marketplace becomes increasingly more global, Union Pacific helps connect America’s manufacturing, food production and natural resources with countries beyond our borders.

U.S. freight shipments are forecasted to increase by 62 percent from 17.6 billion tons in 2011 to 28.5 billion tons in 2040. As Union Pacific aims to provide even more value for our customers, we are making strides to support the nation’s imminent and long-term freight transportation needs. Keeping our vision – Building America – in focus, we are preparing for increasing demand and evolving access to critical resources while dedicating ourselves to providing the service necessary to sustain the country’s economic prosperity.

 

In the course of moving nearly everything Americans rely upon for daily living, our company collaborates with many groups to identify sustainable paths for us all. Recent examples include:

  • Establishing a UP CARES public safety grant program.

    Crossing accidents on our railroad decreased by nearly 7 percent from 2012 to 2013; however, motorists nationwide continue to make unsafe decisions at crossings with tragic results. Responding to the need for more engagement with our neighbors, we established a grant program to fund community-owned initiatives that enhance railroad safety and promote accountability for safe behaviors.

  • Conducting emergency training and response outreach.

    To safeguard the chemicals our customers produce and that Americans require, we are connecting with local, state and federal first responders, training nearly 5,500 people in emergency response preparedness approaches.

  • Hiring 3,450 employees, about 25 percent of whom are military veterans.

    Union Pacific has a strong commitment to hiring veterans, whose backgrounds make them ideal candidates for many railroad jobs. Through a military-specific recruiting plan, we are attracting talented veterans to our workforce and providing them with competitive benefits and salaries above the national average.

  • Spending $484 million with minority- and women-owned businesses.

    Every $1 spent with a minority-owned firm produces $1.74 of economic impact in its community. To establish contracts with companies representing the populations and communities with whom we do business, we increased our ongoing spending with diverse suppliers by approximately 11 percent over 2012.

  • Innovating to reduce our environmental impact.

    We continue to assess how climate change-related issues can affect our company, as well as our customers. Union Pacific’s actions to increase fuel efficiency and reduce greenhouse gas emissions are reflected in our best-ever performance in CDP climate change reports. Union Pacific customers eliminated an estimated 33.7 million tons of greenhouses gases in 2013 by choosing rail over truck transportation.

We cannot predict all events that will impact our business, as evidenced by Colorado floods that bore a 7-story-deep hole along our route and the “polar vortex” that blanketed two-thirds of our network. Fortunately, more than 150 years of service has taught us that the unexpected is inevitable and resiliency will be critical to our viability. Investments in track and equipment made years prior were essential to our ability to adapt quickly and reallocate resources, providing service for our customers when Mother Nature dealt her worst.

We continue to invest, spending $3.6 billion in 2013 to further strengthen our infrastructure; purchase 100 new, more fuel-efficient locomotives, 950 freight cars and 2,000 domestic containers; and install nearly 100 miles of new track.

This report illustrates how Union Pacific is progressing in efforts to operate safely, strengthen communities, engage employees and preserve the environment. We also discuss our goals across these key areas. Challenges we have encountered, such as the decline in our fuel efficiency, also are identified as we recommit with shared resolve to achieve objectives resulting in the greatest benefits for our business and stakeholders.

 

 Jack Koraleski Signature
Jack Koraleski
Chairman and CEO