Canadian Pacific Kansas City (CPKC) CEO Keith Creel says his railway is “making its own luck” amid trade tensions, economic uncertainty, and abundant truck capacity, all of which can slow volume growth.
“We create solutions instead of excuses,” Creel told an investor conference on Wednesday. Key strategies include:
- Expanding traffic between Canada and Mexico as U.S. tariffs make domestic markets less attractive
- Launching new services, including Americold’s temperature-controlled intermodal moves connecting Mexico, the Midwest, and Canada
- Developing interline intermodal service with CSX linking Mexico and Texas to the Southeast
- Leveraging single-line, cross-border service to and from Mexico
Growth Despite Challenges
For the current quarter, CPKC’s revenue ton-miles have risen 2.2%, though carload and container volumes are down 1.7%, reflecting a strong first-quarter 2025 when shippers rushed to beat U.S. tariffs.
Creel is optimistic that trade disagreements between the U.S., Mexico, and Canada will be resolved, likely starting with Mexico. He notes strong relationships and ongoing negotiations, predicting that a new trade deal will encourage investment in Mexican manufacturing.
Mexico-Canada Trade Expands
CPKC has seen notable results from its focus on bridging Mexico-Canada trade via the U.S. In 2024, Mexico-Canada traffic represented roughly 2% of revenue; now it exceeds 3%, generating nearly $500 million in incremental revenue, with an additional $100 million expected this year. Shipments include French fries, grain, and petroleum products.
New CSX Intermodal Service
Next month, CPKC and CSX will launch a dedicated intermodal train via a new Myrtlewood, Alabama, interchange on the former Meridian & Bigbee line. Upgrades will allow 49-mph operations over the route, reducing transit time from Atlanta to Monterrey in three days and to central Mexico in four.
Creel compares this new Southeast Mexico Express (SMX) service to the already successful Midwest Mexico Express trains 180/181. He emphasizes the need for upfront investment to grow new services, noting that anchor customers like Schneider will help fill the trains.
Truckload Conversion Goals
CPKC is about 40% toward its goal of removing 64,000 truckloads from highways annually, slower than expected due to excess truck capacity, low rates, and the time needed to launch new facilities like Americold’s cold storage warehouses in Kansas City, Mexico, and Saint John, New Brunswick.
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Creel expresses skepticism about projections from Union Pacific and Norfolk Southern that their merger could remove 2 million truckloads, calling the target “highly aspirational” and more complex than often portrayed.
Conclusion
Creel attributes CPKC’s growth to a unique network and proactive investment strategy. “We’ve made our own luck in connecting new markets,” he says, highlighting the railway’s continued expansion in a challenging macroeconomic environment.
