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SHORT LINE RAILROADS
originates on a CPKC-served short line.
FT: There seems to have been considerable consolidation south of the border (i/e G&W) where what looks like an independent line is actually owned by a major company or a Class 1 railroad. Is this the case in Canada?
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Mackenzie: Short line railways are a desirable investment and the sale of an existing short line or the potential to create a new short line operation through the purchase of a branch line or new track construction would be interesting to a wide range of investors. Short line railways have industry-specific challenges, such as access to competitive insurance markets and those challenges may be easier for larger players to navigate.
However, it is very possible for smaller local ownership groups and co-operatives to succeed in the short line railway business, especially with entrepreneurial business practices and supportive government policies.
The ownership models of existing short line railways in our association remain quite diverse.
FT: Any other thoughts on the topic of Canadian short lines?
Mackenzie: Canadian short line railways play an understated but very important role in the Canadian supply chain. In addition to handling agricultural and industrial freight traffic, our members also provide a large amount of railcar storage and repair services. Every railcar stored in a storage facility represents a car that is not clogging the main Class 1 network, especially during times of economic upheaval, foul weather, emergencies and labour disruptions. During the early months of the pandemic, our short line railways were a very important pressure-relief valve to the Canadian rail network by providing space for underutilised railcars.
In Western Canada, Canadian short lines are often rural branch lines operating between small, rural communities. We are recognised as good employers in rural areas and offer high quality, attractive jobs. Because of the work-life balance on offer by short line railways and the quality of our reputation as employers, many short lines are able to attract and retain operational staff.
