Canadian National Railway Company (CNR) JPMorgan Industrials Conference 2026 summary

Operational performance and network conditions

• Network performance is at its best in over a decade, with car velocity up 10%, train speed up 6%, and terminal dwell down 6% year-to-date.

• Record fuel efficiency was achieved in February 2026, and strong labor and locomotive productivity are evident.

• Winter weather caused significant operational challenges, including heavy snowfall and blizzard conditions, impacting costs and volumes.

• Grain movement set records in several months, with improved car cycle times freeing up capacity.

• The network has capacity for growth, with major capital projects completed and a healthy locomotive fleet.

Financial and market headwinds

• Currency fluctuations (CAD/USD) are expected to create a CAD 0.05 headwind to EPS in Q1, with each cent of appreciation being unfavorable.

• Rising fuel prices due to geopolitical events are expected to create a CAD 0.03–0.04 headwind in Q1, but may reverse later in the year.

• Tariffs on forest products (45%) and metals (50%) are significant headwinds, with forest products alone impacting results by CAD 350 million in 2025.

• Snow removal costs are expected to be a CAD 10–20 million year-over-year headwind in Q1.

Operational initiatives and organizational changes

• Terminal efficiency initiatives launched in late Q4 are underway at six major terminals, aiming to right-size resources and maintain discipline.

• The company is aggressively pursuing these initiatives, targeting completion by July, with ongoing reviews to prevent resource creep.

• Staffing is well-positioned for growth, with a high return rate from furloughed employees and improved labor productivity under new work-rest rules.

• Sales, marketing, and operations teams are more closely aligned, with new leadership energizing efforts to capture incremental business.

• Decision-making has been streamlined, reducing red tape and improving agility.