Network Service Update from Beth Whited, Executive Vice President & Chief Marketing Officer

Announcement Number: CN2018-4
Categories: All Customer News
Posted Date: February 15, 2018

To Our Customers,
As many of you know, 2017 presented its share of operating challenges to our rail network that have had negative impacts on our service. For instance, in 2017 we installed about 60 percent of our federally mandated Positive Train Control (PTC) footprint, primarily in the Western and Northern regions. As with any new system, there is a learning curve and we are working through training, technical, and train handling issues that are impacting service. Unprecedented snow, rainfall and flooding in the west caused major disruptions. And during hurricane season, the restoration effort associated with Hurricane Harvey impacted operations for more than a month, followed by Hurricane Nate.

We know factors out of our control will disrupt and slow service, but it is our responsibility to restore it to the high level you, our customers, need and have come to expect from Union Pacific. We are working aggressively to improve service throughout our rail network. The following are challenges facing each of our regions, the efforts we are taking to mitigate them, and additional actions we’re taking to improve service system wide.

Southern Region

At the end of last year, congestion in the Southern Region slowed traffic, further elevated car inventories, and resulted in an additional need for locomotives and crews between Houston, Texas and Livonia, Louisiana. We have supplemented our workforce by deploying crews from other areas of the network to the Southern Region. In addition, we will be graduating 110 new crew members from training in the south between now and the end of the first quarter and 150 more in the second quarter.

Over the course of 2018, we will also be cutting over PTC across significant sections of the Southern Region and plan to apply the lessons we’ve learned from implementation thus far.

Northern Region

Extreme cold has impacted operations in the Northern Region. We continue to stage snow removal equipment and position mechanical staff members to ensure we have 24/7 coverage to quickly respond to weather-related challenges. We also continue to operate our winter weather command centers throughout the Northern Region.

Western Region

We recently rolled out a pilot program in the Pacific Northwest and Northern California focused on increasing the frequency at which we depart trains. The testing of this operating initiative led to some positive benefits for customers, which we will retain; however, the pilot was not beneficial in all respects. As such, we will discontinue aspects of this pilot that have been negatively impacting service and build on its positive benefits. 

Also affecting velocity are short-term issues with a new computer system at our West Colton classification yard. We are diligently working through implementation issues associated with this recent upgrade. In addition, crews are being added between Roseville and Colton to ensure adequate resources are available as a backlog of trains are processed by our major yards in California.

Network-Wide Initiatives

Across our network, we are also taking the following steps to improve service:

  • Activating additional locomotives from storage to handle the ramp-up in our business and to prepare for increased volumes.
  • Continuing to hire new crew members and recall employees from furlough. In 2017, 1,950 crew members were brought into the workforce from hiring and furlough recalls, and we are planning to recall another 600 employees for the first quarter.
  • Increasing train sizes to reduce the number of trains actively operating. Shipping more cars with fewer trains helps us improve our network velocity.
  • Establishing various transportation plan changes to balance our terminals.
  • Actively reviewing any rail car with excessive dwell and prescribing an associated action with each.
  • Adding jobs to improve yard fluidity. This will also ensure we are spotting cars once they arrive at the serving yard and pulling cars from industry once they are released.
  • Working with customers to manage rail car flows and right-size active rail car fleets.
  • Continuing implementation of PTC throughout our rail network and developing the PTC technology to improve performance. An ongoing problem-solving effort to address any issues associated with the system will continue throughout the year.

We understand the quality of service we provide to you impacts your supply chain. We are actively working to keep your business moving forward.

We appreciate the confidence you’ve placed in Union Pacific, and we are committed to providing the excellent service product you have come to expect from us. Thank you for your business. We will continue to provide updates as additional information becomes available.

Sincerely,

Original | Beth - Web Sig, Small

Beth Whited
Executive Vice President & Chief Marketing Officer