CN to buy 350 lumber cars, vowing to ‘do better’ as demand grows

CN Rail says it will purchase 350 lumber cars to meet growing demand for forest products despite lower segment revenues in the first quarter.

“CN needs to and will do better moving lumber to market,” stated interim president and CEO JeanJacques Ruest.

The new cars will be manufactured by National Steel Car Ltd. at its assembly plant in Hamilton, Ont., with deliveries expected to begin in September. CN said it is also looking at an option to purchase or lease an additional 300 cars, which have a maximum load capacity of 129,000 kilograms.

The head of North America’s largest lumber producer welcomed CN’s investment. “West Fraser looks forward to continuing to work with partners who can provide an effective supply chain serving the solid U.S. housing market,” said Ted Seraphim, president and chief executive of West Fraser Timber.

Canfor’s vice-president of supply chain, Bob Hayes, had a similar reaction. “This is certainly welcome news that CN is making much-needed investment in the infrastructure we rely on to serve our customers,” he said. “We are working daily to clear the backlog in inventory and making progress, though we are not back to normal inventory levels as yet.”

In addition to new rail cars, CN said it expects to take delivery of the first of 60 new GE locomotives next month, and recently said it would acquire 350 additional box cars to meet demand.

CN Rail is spending an extra $700 million this year, half of which will be used to upgrade its network, with the work to be completed by November. t also announced earlier this year that it is hiring 2,000 workers, including hundreds of conductors.

“We are investing to move the economy as we put the rolling stock, infrastructure and people in place to serve the growing needs of our valued customers,” said Ruest.

National Steel Car said the order for lumber cars will result in the hiring of more than 250 employees at its Hamilton assembly plant, which currently employs more than 1,500 people.

The Montreal-based railway also said Wednesday that it is temporarily parking about 1,200 hopper cars, which are used to transport loose bulk products such as coal, grain and ore, after moving all grain orders in Western Canada for the third straight week.