Rail troubles? In Canada? Wow

Here we are again — under-performing railways in Western Canada. What a surprise. Just like having a winter or a labour dispute when you have thousands of grievances piled up at bargaining time.

To be fair, our railways have long been destined for failure. We have expected our two major, monopoly-ish Canadian railways to act like they are public utilities when we need them most, while presuming them to be public companies whenever our needs aren’t obvious.

Operating ratios are used to compare large private companies that are dependent on big percentages of their revenues to keep their operations functioning or would cost too much to reconstruct from scratch, like a railway.

And, like any performance measure, these are compared to the most profitable benchmarks in the marketplace. Our two railways are pitted against American Class One rail systems. Take the BNSF. It posted a 65 percent operating ratio for last year. Union Pacific posted a 62. Less than 80 has long-been considered pretty good.

Like golfing, lower is considered better.

In the United States, there are six non-Canadian operators that run on some pretty sweet, high volume track. Most of it doesn’t have polar-ish winter and the railways have far more clients to choose from, and they, mostly, don’t have to put up with nearly as many pesky federal labour laws and big union agreements.

Like many prairie opportunities, we have to start by making our own luck. In this case it begins with being able to get products to customers with as few hiccups in our giddy-up as possible. Read about your most recent global sales opportunities from rising ocean freight rates in the WP Markets pages this week.

Despite being compared to some of the most efficient railways on the planet, our two Canadian companies maintained some of the best operating ratios on the continent for 2017. Canadian Pacific Railway was 58.6 and Canadian National Railway was 60.04.

Maybe it’s time we look closer look at these two parallel monopolies, just to make sure they are doing everything they can to help Canadians make their own luck and just in case they have been spending too much time staring at their operating ratios.

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