2021 Mutual Commitment Program Changes
Announcement Number: IM2021-37
Categories: All Intermodal
Posted Date: February 22, 2021
Dear Customer,
As we continue to evaluate the Mutual Commitment Program (MCP), we are excited to announce multiple changes to this program, effective March 8, 2021. These changes will add value to MCP, as well as improve the overall customer experience.
MCP Gate Reservations
- We are developing a process that will align Intermodal Terminal Reservations (ITR) and equipment baseloads (this is a work in progress and subject to change):
- ITR pools will be based on MCP awards and equipment commitment
- ITR pools will be measured and adjusted for each lane at an MCP level
Pools will be evaluated based on average weekly ingates (removing lowest 2 weeks)
ITR adjustments will be made each week for the following week’s allocation - Total pool allocation per lane will be distributed at an aggregated IMC level
IMCs can use their pool in a given lane as needed across all MCPs in that lane
MCP Minimum Volume Requirements
- 250 MCP contract minimum
- 100 unit metro minimum for all metros except LA, STIR, Laredo and Monterrey
- 500 unit metro minimum for LA, STIR, Laredo and Monterrey
MCP Baseload Calculation
- Baseloads will be recalculated effective March 7, 2021
- The two lowest weeks from the baseload calculation will be removed (currently 4 lowest weeks)
- Customers will still have the opportunity to grow their baseloads by increasing shipments over awards (the lessor of 20% or +10/week)
MCP Aggregate Program
- Baseloads will be recalculated effective March 7, 2021
- Manual baseload adjustments for MCPs below new minimums (in LA, STIR, Laredo and Monterrey) will be transferred to Aggregate
- No surge allowance will be provided for Aggregate business
- Limited equipment will be available off the ramp in constrained markets
MCP Surge Allowance
- Union Pacific will continue to reward committed shippers with a surge allowance when their actual volumes are consistent with their awards:
- Actual vs. Award < 50% = 0% surge allowance
- Actual vs. Award 50%-75% = 5% surge allowance
- Actual vs. Award >75% = 10% surge allowance
If you have any questions, please don’t hesitate to contact your Intermodal Sales Representative. We thank you for your business and look forward to the successful implementation of these MCP changes.
Disclaimer
For the term of the referenced agreement(s) and for six (6) months thereafter, no party may disclose any of the terms of the Letter Quote(s) to any non-party without the prior written consent of the other parties except (1) as required by law; (2) to a corporate parent, subsidiary or affiliate; or (3) to counsel or auditors retained by a party for the purpose of assessing the accuracy of freight charges, if, and only if, they agree in a legally binding instrument that they will abide by this confidentiality clause as if they were a party to this Quote. Each party agrees to indemnify the other from and against any damage(s) suffered by a party as a result of disclosure by a party hereto, or by an auditor, of any of the terms, conditions or rates set forth herein in violation of this CONFIDENTIALITY provision. In the event a party determines that the terms of this Quote have been disclosed to a non-party, then the non-disclosing party shall have the right to seek whatever remedies it/they may have at law or in equity.