CP Rail restructuring eliminates thousands of jobs
Published Tuesday, December 4, 2012 3:14PM MST
Last Updated Tuesday, December 4, 2012 6:28PM MST
Canadian Pacific says it will be chopping up to 4500 jobs by 2016 in an effort to improve service and grow the business.
The company says the positions will be eliminated through job reductions, attrition and by using fewer contractors as part of its restructuring plan.
The company's President and CEO E. Hunter Harrison outlined the restructuring plan going forward and says the changes will improve service, increse efficiency, lower costs and allow for growth.
On Tuesday Harrison said in a release, “We now have a leadership team that understands the urgency of making change and improving the culture of this organization” Harrison said. “CP has many talented railroaders who want to win. Together we are squarely focused on improved service and becoming the low cost carrier. This will allow us to continue to grow with our customers.”
In addition to job cuts, the restructuring plan includes:
- New longer sidings program will improve asset utilization and increase train length and velocity – The plan will allow CP to move the same or increased volumes with fewer trains, and is expected to save over 14,500, or 4%, crew starts
- Explore options to maximize full value of existing and anticipated surplus real estate holdings
- Relocate CP's current corporate headquarters in downtown Calgary to new office space at CP-owned Ogden Yard by 2014
- Review options for the Delaware & Hudson (D&H) in the U.S. Northeast, while maintaining options for continued growth in the energy business
- Announced earlier, CP is seeking expressions of interest on the 660-mile portion of the former Dakota, Minnesota & Eastern (DM&E), west of Tracy, Minnesota
CP says it expects 1,700 positions to be eliminated by the end of this year.
The strategic moves are the latest for the railway since a new board of directors installed Hunter Harrison as its chief executive officer in the summer.
Harrison is an American-born retired CEO of Canadian National Railway (TSX:CNR) and is credited with turning the Montreal-based company into the most efficient major railway in North America.
The news follows an announcement Monday that CP has deferred plans to extend one of its lines into a coal-producing area known as Powder River Basin.
Harrison and other Canadian Pacific executives are expected to reveal more details of its strategic plans at an investor conference in New York. The event started Tuesday and continues Wednesday.
(With files from ctvnews.ca)