2nd trick op wrote:There's some commentay in this month's issue of Trains regarding possible restructuring or rationalization of the lines of CPR and its Amercan partners and subsidiaries. One particularly tantalizing possibility was the sale of the Windsor-Toronto line to an American carrier -- sort of the reverse of CN's acquisition of Illinois Central -- it bears watching.
What sets CP Rail aside from other carriers is the most direct mainline from the Pacific Northwest to Chicago, Montreal, and Buffalo (the New York Harbor gateway.) A sale of the corridor is a strange and disconcerting proposal, one that would adversely impact its ability to capitalize on that short mainline. The company has been effectively frozen out of the New York Harbor market, is struggling to make hay on the North Dakota oil fields, and is the only one of the seven Class 1s with no Gulf of Mexico access, so I don't see how sale of the corridor will do anything but make CP a less-desirable merger partner.
The sale of the MILW main to Wisconsin and Minnesota is another strange suggestion in a pre-merger CP Rail - though better than selling the corridor, it would affect CP's ability to mothball its Lake Superior main from Thunder Bay to Sudbury, as Trains
also suggested. A sale of the D&H to NS and/or New York would be a much better idea, with fewer drawbacks aside from the loss of market share. Trains
didn't suggest this, but CP Rail might also consider selling the former ICE KC-Chicago line to KCS, to get some cash out of the DM&E purchase and develop even more goodwill with KCS.
Ultimately, I think CP is headed into the arms of Union Pacific and one of the eastern carriers. It's up to the CP Board of Directors to ensure their company is a lean, well-rounded Class One carrier with lots of traffic sources and useful mainline, or the merger will be sooner, in more small bites, and at a great loss to shareholders.