Canadian Pacific Kansas City Limited, doing business asCPKC (known as Canadian Pacific Railway Limited until 2023), is a Canadian railway holding company. Through its primary operating railroad subsidiaries, Canadian Pacific Railway (CP) and Kansas City Southern Railway (KCS), it operates about 32,000 kilometres (20,000mi) of rail in Canada, Mexico, and the United States, and is the only single-line rail corporation ever to connect the three countries. CPKC is headquartered in Calgary and led by President and CEO Keith Creel.
Thirty days later, Canadian National Railway (CN) issued a competing offer of $33.7billion.[1] But in August, the US Surface Transportation Board (STB) blocked the CN deal, ruling that the company could not use a voting trust to assume control of KCS because it might reduce competition in the railroad industry.[2]
On September 12, 2021, KCS accepted a new $31billion offer from CP and terminated its agreement with CN.[3] KCS's shareholders voted to approve the merger on December 10, 2021. The STB had already ruled that CP's plan to use a voting trust to take control of KCS would not hamper competition.[2] The voting trust allowed CP to become the beneficial owner of KCS in December 2021, but the two railroads operated independently until receiving approval for a merger of operations from the STB.[4][5]Keith Creel, President and CEO of CP and future CEO of the merged company, chose the name for the new company as a way to honor the long history of the two preceding companies.[6]
Union Pacific and BNSF Railway raised objections to the merger with the STB. Both companies were concerned about CPKC's projected increase in traffic because it would unduly congest UP owned tracks through the Houston area (Houston, West Belt, East Belt, Beaumont, Harrisburg and Glidden Subdivisions), where both UP and BNSF (the latter of which operates in the Houston area through a combination of owned tracks and trackage and haulage rights on UP tracks) operate a large amount of daily traffic. CPKC has trackage rights from Beaumont to Rosenberg.[7]
At the STB hearings, CP and KCS defended their merger proposal, arguing that Houston has sufficient capacity to support the projected increases in traffic. Creel argued that receiving and departure tracks at the west end of Englewood Yard, UP's main yard in Houston, could be lengthened to accommodate longer trains. UP responded that although they had a plan to expand the yard, they could not proceed until existing environmental problems, stemming from creosote contamination that has affected the area around Englewood, were resolved (Southern Pacific for decades operated a facility at Englewood to treat railroad ties with Creosote, and accidental spills of the substance caused severe contamination in the neighborhoods surrounding the yard; UP is currently working with the City of Houston and the Environmental Protection Agency (EPA) on a remediation plan for the existing contamination in the area). The Board suggested, to mediate between the disputing parties, the possibility that, pending merger approval or post-merger, KCS or eventually CPKC, apply to UP for trackage rights from Texarkana to Laredo via San Antonio and Austin to reroute part of the north-south traffic, bypassing Houston.[8]
The two companies demanded that CPKC perform construction work on new sidings on both the lines that meet in the Houston area and on Brownsville Subdivision between Placedo and Robstown, near Corpus Christi, where CPKC trains leave the UP tracks in South Texas.[9]
Metra also opposed the merger, along with a group of West suburban Chicago communities (DuPage County, Bartlett, Bensenville, Elgin, Itasca, Hanover Park, Roselle, Wood Dale and Schaumburg) on the Milwaukee District West Line, arguing that the projected increase in traffic would bring delays in the provision of Metra's passenger rail service, as well as a decrease in the quality of life and the negative consequences on economic development in the communities located along the line.[10][11]
In STB hearings, Canadian National, who had already lost KCS to CP, presented a plan to acquire the KCS line—the former Gateway Western, which linked Kansas City to Springfield, Illinois; St. Louis, Missouri; and East St. Louis, Illinois—tie it to its former Illinois Central Gilman Subdivision, and thus create via both Springfield and via St. Louis a new corridor between Kansas City, Michigan and eastern Canada. This would bypass Chicago, and, according to the plan presented by CN, divert 80,000 long-haul truck shipments to rail annually. The plan included the improvement of the corridor, valued at more than US$250 million.[12] A few months later, CN resigned its intentions to purchase the Springfield Line to try to obtain trackage rights on the line, always with the same intention of creating the corridor proposed in the original plan to purchase the line filed with the STB.[13] The STB would ultimately reject plans submitted by CN to operate on the Springfield Line.[14]
Despite all the objections raised at the hearings, the final approval of the merger came on March 15, 2023, and the merger was completed on April 14, 2023.[15][16][11]
KCSM #4567, a GE AC4400CW from CPKC that still retains the gray Transportadora Ferroviaria Mexicana (TFM) scheme with the KCS de Mexico logos and lettering painted over where the TFM logos used to beTwo CPKC unit trains, one grain and another crude oil, meet up at Siloam Springs, Arkansas - with locomotives from both two preceding railroads.
The merger created the first and only single-line railway connecting Canada, the U.S. and Mexico with an approximately 32,000-kilometre (20,000mi) network.[17] Fully integrating the two railroads is expected to take up to three years.[17]
Post merger history
Seven days after the merger, the company announced that it had landed its first major contract, handling Schneider National intermodal traffic between the U.S. and Mexico. On April 25, it signed a similar agreement with Knight-Swift.[18] The announcement was seen as backing up pre-merger projections that CPKC's single-line service would enable it to compete in the Chicago–Mexico corridor that had been dominated by the Union Pacific and BNSF.[19] In response, on April 24, Union Pacific responded by announcing a partnership with Canadian National Railway and Grupo México (owner of Ferromex and Ferrosur) to work together to accelerate the exchange of intermodal traffic between Mexico and Chicago or further north into Canada.[20]
On May 11, 2023, CPKC launched its new service "Mexico Midwest Express (MMX)", numbered I180 and I181, which is mainly oriented to intermodal and automobile transportation, and also provides an approximate travel time of 98 hours between Chicago and Kansas City to Monterrey and San Luis Potosi, shorter travel times than those offered by the "Falcon Premium" service of UP, CN and Grupo México.[21] Previously, and as part of preparatory moves for the day after the merger, CP and KCS launched a series of test interline services between the Lázaro Cárdenas Port in the Michoacán Mexican state, and the Bensenville Yard in Chicago.[22]
On June 28, 2023, CPKC announced the intent to jointly acquire with CSX Transportation the Meridian and Bigbee Railroad (MNBR). The MNBR creates a connection 168 miles (270km) between CSX in Montgomery, Alabama and Meridian, Mississippi, where it joins the Meridian Speedway westbound. Under the proposed agreement, CPKC would acquire the 50.4 miles (81.1km) segment of the line between Meridian and Myrtlewood, Alabama, so-called Western Line, while CSX, in a nearly separate transaction, will resume operations on the so-called Eastern Line, between Myrtlewood and Montgomery, terminating the lease currently in place with MNBR. MNBR will cease operating between Myrtlewood and Montgomery, although it may continue to operate between Meridian and Myrtlewood and serve existing customers on that segment of the line.[23] If the STB approves the transaction, this will provide a new direct connection between the two companies' networks (CSX and CPKC already have connections New Orleans and in St. Louis, Missouri). In compensation, MNBR owner Genesee & Wyoming would receive CPKC properties in Alberta along with rights on CPKC lines.[24] The connection through the MNBR line will allow CSX traffic destined for Mexico to be delivered directly to CPKC, eliminating the need for a third intermediary railroad to move such traffic. Currently, CSX traffic bound for Mexico is exchanged with the Union Pacific in New Orleans, who then takes it to the cross-border gateway in Laredo, Texas, where it is delivered to CPKC.[25] MNBR's Western Line, once acquired by CPKC, will be renamed Haverty Subdivision, in honor of former KCS CEO and President Mike Haverty, the original driver of the idea to acquire MNBR more than two decades ago, to tie the KCS and CSX rail networks.
Haverty, KCS CEO and President from 1995 to 2015, was the driving force behind the company's expansion into to Mexico during his tenure, acquiring Tex-Mex in 1995, and then, that same year, win along with Transportadora Maritima Mexicana (TMM) the concession of the Mexican Northeast Railroad under the name Transportadora Ferroviaria Mexicana (TFM), which would ultimately become the catalyst for CP to acquire KCS and CPKC to be formed.[26]
In October 2024, the STB approved CPKC's purchase of the M&B line between Meridian and Myrtlewood, along with CSX's resumption of operations between Myrtlewood and Burkville. The approval will be effective November 16, 2024. Both CPKC and CSX will initially interchange across the line two trains per day in each direction, at least for the first five years.
CN and Amtrak unsuccessfully raised objections to the purchase of the M&B line, fearing that increased traffic on the Meridian Speedway would cause congestion. CN required CPKC report the daily number of trains running through the Speedway to know if there will indeed be congestion on the line. Amtrak, for its part, requested that the length of trains running daily on the line be adjusted to the length of the existing sidings along the route.[27][28]
The CN and Amtrak requests were rejected by the STB, on the grounds that the two daily train pairs that CPKC and CSX plan to interchange across the M&B line will not cause congestion on the Speedway.[28][29]
CP 9375 is displayed as part of the 2816 'Final Spike tour' event at Kansas City Union Station. The 9375 is the first locomotive to receive the CPKC corporate paint scheme.
In August 2023, UP and CPKC butted heads again, this time over the trackage rights that KCS once held between the "south end" in Kansas City and Council Bluffs, Iowa, over UP tracks. CPKC informed the STB that UP was blocking the trackage and haulage rights originally granted to KCS, which dated back to the merger between the Missouri-Kansas-Texas Railroad (MKT), better known as "The Katy", and UP in 1988. CPKC inherited those rights from KCS. UP quickly came out to question the presentation made by CPKC to the Board, saying that the trackage rights in question were much more narrow in scope. When UP acquired the Katy, the Interstate Commerce Commission (ICC) required UP, as a condition of merger approval, to grant other railroads (including KCS) trackage and haulage rights to operate in the "Omaha/Council Bluffs-Kansas City corridor, with a further ability to move the grain traffic originating in this area to the Gulf." UP also said that it complied with the condition imposed by the ICC for the merger with Katy, "by granting KCS 'North End' rights — that is, rights to operate in the Omaha/Council Bluffs-Kansas City corridor — with ancillary 'South End' rights 'between Beaumont and Houston/Galveston' that KCS needed 'in order to provide a fully competitive service on north-end grain shipments.'"[30][31]
On April 24, 2024, as part of the company's first anniversary celebrations, the Steam locomotive CPR #2816 known as "The Empress" was launched on a historic transnational tour that will travel most of CPKC's network from Calgary, ending June 7 in Mexico City.[32][33][34][35]
2816 during its Final Spike Steam Tour, July 10, 2024, in Gleichen, Alberta
CPKC fast-growing international corridor from Laredo to Beaumont: own routes are marked in green, while sectors where trains running under Union Pacific trackage rights between Beaumont and Rosenberg (including the Houston area), and between Victoria and Robstown are marked in red. In the case of traffic through Houston, the usual routes (Houston Subdivision to West Junction, where it joins the Glidden Sub, and the West Belt Sub between the CP-Control Point Maury Street near Tower 26 and Belt Jct, where trains, generally eastbound, enter the Beaumont Sub) are marked in red, and in orange, the detours used in case of congestion on the usual route.
CPKC operates about 32,000 kilometres (20,000mi) of rail across Canada, Mexico and the United States.[17] As of April 2023, CPKC has around 20,000 employees.[17] CPKC has its global headquarters in Calgary, Alberta, Canada with its U.S. headquarters in Kansas City, Missouri, and its Mexico headquarters in Mexico City and Monterrey.[37]
Company executives said that merging CP and KCS would be "straightforward" because the railroads only touch at Kansas City, and interchange volumes were relatively low, with about four trains per day as of September 2021. They also cited that the two companies largely used the same back-office information technology systems.[6]
The Canadian National Railway Company is a Canadian Class I freight railway headquartered in Montreal, Quebec, which serves Canada and the Midwestern and Southern United States.
BNSF Railway is the largest freight railroad in the United States. One of six North American Class I railroads, BNSF has 36,000 employees, 33,400 miles (53,800 km) of track in 28 states, and over 8,000 locomotives. It has three transcontinental routes that provide rail connections between the western and eastern United States. BNSF trains traveled over 169 million miles in 2010, more than any other North American railroad.
CSX Transportation, known colloquially as simply CSX, is a Class I freight railroad company operating in the Eastern United States and the Canadian provinces of Ontario and Quebec. Operating about 21,000 route miles (34,000 km) of track, it is the leading subsidiary of CSX Corporation, a Fortune 500 company headquartered in Jacksonville, Florida.
Railroad classes are the system by which freight railroads are designated in the United States. Railroads are assigned to Class I, II or III according to annual revenue criteria originally set by the Surface Transportation Board in 1992. With annual adjustments for inflation, the 2019 thresholds were US$504,803,294 for Class I carriers and US$40,384,263 for Class II carriers.
The Kansas City Southern Railway Company was an American Class I railroad. Founded in 1887, it operated in 10 Midwestern and Southeastern U.S. states: Illinois, Missouri, Kansas, Oklahoma, Arkansas, Tennessee, Alabama, Mississippi, Louisiana and Texas. KCS owned the shortest north-south rail route between Kansas City, Missouri, and several key ports along the Gulf of Mexico.
Kansas City Southern (KCS) was a transportation holding company with railroad investments in the United States, Mexico, and Panama and operated from 1887 to 2023. The KCS rail network included about 7,299 miles (11,747 km) of track in the U.S. and Mexico.
The Crescent is a daily long-distance passenger train operated by Amtrak between New York City and New Orleans. The 1,377-mile (2,216 km) route connects the Northeast to the Gulf Coast via the Appalachian Piedmont, with major stops in Charlotte, North Carolina; Atlanta, Georgia; and Birmingham, Alabama.
The Soo Line Railroad is one of the primary United States railroad subsidiaries for the CPKC Railway, one of six U.S. Class I railroads, controlled through the Soo Line Corporation. Although it is named for the Minneapolis, St. Paul and Sault Ste. Marie Railroad (MStP&SSM), which was commonly known as the Soo Line after the phonetic spelling of Sault, it was formed in 1961 by the consolidation of that company with two other CPKC subsidiaries: The Duluth, South Shore and Atlantic Railway, and the Wisconsin Central Railway. It is also the successor to other Class I railroads, including the Minneapolis, Northfield and Southern Railway and the Chicago, Milwaukee, St. Paul and Pacific Railroad. On the other hand, a large amount of mileage was spun off in 1987 to Wisconsin Central Ltd., now part of the Canadian National Railway. The Soo Line Railroad and the Delaware and Hudson Railway, CPKC's other major subsidiary, presently do business as the Canadian Pacific Railway (CP). Most equipment has been repainted into the CP scheme, but the U.S. Surface Transportation Board groups all of the company's U.S. subsidiaries under the Soo Line name for reporting purposes. The Minneapolis headquarters are in the Canadian Pacific Plaza building, having moved from the nearby Soo Line Building.
The Gateway Western Railway was a Class II railroad that operated 408 miles of former Chicago and Alton Railroad track between Kansas City and St. Louis, Missouri. It also operated between Kansas City, Missouri, and Springfield, Illinois on the old Alton Railroad line that eventually was the Chicago, Missouri and Western Railway.
Kansas City Southern de México, S.A. de C.V. is a Mexican railroad and operating subsidiary of Canadian Pacific Kansas City Limited (CPKC). The company was founded in 1996 as Transportación Ferroviaria Mexicana, a joint venture between KCS and Transportación Maritima Mexicana after the companies won a concession from the Mexican government to operate the 5,335-kilometer (3,315 mi) Northeast Railroad connecting Monterrey and Mexico City with a US port of entry at Laredo, Texas and seaports at Lázaro Cárdenas and Veracruz. In 2005, KCS bought out its partner's shares in the railroad, giving it full control.
The Texas Mexican Railway was a short line railroad in the U.S. state of Texas operating between Corpus Christi and the Texas Mexican Railway International Bridge in Laredo, Texas. It is often referred to as the Tex Mex, or Tex Mex Railway.
The Meridian and Bigbee Railroad was a Class III railroad that operates over 168 miles (270 km) of track between Meridian, Mississippi and Burkville, Alabama. Additionally, the M&B had trackage rights over CSX from Burkville to Montgomery, Alabama. MNBR used to operate with a 286,000-pound railcar loading capacity.
The Gateway Eastern Railway was a railroad subsidiary of the Kansas City Southern Railway (KCS), owning a 17-mile (27 km) main line between East Alton and East St. Louis, Illinois, United States. Originally created in 1994 as a subsidiary of the Gateway Western Railway, which acquired the East St. Louis-Kansas City line of the Chicago, Missouri and Western Railway in 1990. It was acquired by KCS along with its parent in 1997.
The Texas Mexican Railway International Bridge is an international railway bridge across the Rio Grande and U.S.-Mexico border between Laredo, Texas, and Nuevo Laredo, Tamaulipas, the only rail link between these cities. Owned and operated by CPKC, the single-track bridge is the busiest rail border crossing in North America. It is also known as the Laredo International Railway Bridge and Puente Negro.
Canadian Pacific 2816, also known as the "Empress", is a preserved class "H1b" 4-6-4 Hudson-type steam locomotive built by the Montreal Locomotive Works (MLW) in December 1930 for the Canadian Pacific Railway (CP). It is the only non-streamlined H1 Hudson to be preserved.
Pan Am Southern, LLC is a freight railroad jointly owned by Norfolk Southern Railway (NS) and CSX Corporation. PAS is independently operated by the Berkshire and Eastern Railroad, a subsidiary of Genesee & Wyoming. PAS owns trackage known as the Patriot Corridor between Albany, New York, and the Boston, Massachusetts, area, utilizing rail lines formerly owned by the Fitchburg Railroad and later on the Boston and Maine Railroad. It was previously operated by PAR subsidiary Springfield Terminal Railway.
The Meridian Speedway is a 320-mile (510 km) span of railroad track between Shreveport, Louisiana and Meridian, Mississippi. An important rail link between the Southeastern and Southwestern United States, it is operated as a joint venture of Canadian Pacific Kansas City (CPKC), which owns 70% of the partnership; and Alabama Great Southern Railroad, a subsidiary of Norfolk Southern Railway (NS).
The following is a brief history of the North American rail system, mainly through major changes to Class I railroads, the largest class by operating revenue.
↑ Amtrak is working to launch new service between Meridian and Fort Worth, which will run at the Speedway, and CN's Chicago to New Orleans line, former Illinois Central, crosses at-grade the Speedway in Jackson, Mississippi.
Railroads in italics meet the revenue specifications for Class I status, but are not technically Class I railroads due to being passenger-only railroads with no freight component.
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