CN, BNSF Sign Marketing Agreement Targeting Creation of Multiple Interline Services for New Carload Business.

Business Editors

MONTREAL--(BUSINESS WIRE)--Nov. 15, 2000

CN(TSE:CNR.) (NYSE:CNI)

Railroads Make Western Canada-U.S. Pacific Coast Market

Initial Priority

Canadian National Railway Company (CN) and The Burlington Northern and Santa Fe Railway Company (BNSF) announced today an agreement to implement highly-competitive, customer-focused interline rail services for new carload business.

CN's and BNSF's first interline service under this agreement will link markets in British Columbia, Alberta and Saskatchewan with markets in Washington, Oregon, Idaho, California, Nevada, Utah, Arizona, New Mexico and El Paso-Sierra Blanca, Texas.

The marketing agreement gives the two railroads authority to market and price carload traffic originating on one carrier and terminating on the other without first having to negotiate the terms and conditions of the movement.

This joint authority will simplify pricing, enhance response time, and increase customer satisfaction.

New carload interline services are also being contemplated by CN and BNSF in other corridors.

James M. Foote, CN's executive vice-president, sales and marketing, said: "This marketing agreement is yet another example of how CN and BNSF are working together to pursue growth opportunities and to develop ways of making it easier for shippers to use our rail services and to do business with us. CN and BNSF will benefit from opening up new rail interline markets in key international and significant domestic corridors in the United States."

Charles L. Schultz, BNSF's executive vice-president and chief marketing officer, said: "This marketing agreement will increase the railroads' share of existing and prospective markets, and ensure each carrier benefits from profitable market expansion.

It will greatly extend each partner's reach and promote efficient routings that will benefit our customers."

The Western Canada-Pacific coast interline initiative will take advantage of BNSF's comprehensive new service package for carload freight moving between Vancouver, B.C., Northern California, Southern California and Arizona.

      BNSF's new service for carload customers on the I-5 Corridor,
named for the Interstate Highway it parallels, includes:

      - Five-day service between Vancouver and the San Francisco Bay
area;
      - Five-day service between Vancouver and the Los Angeles area, and
      - Seven-day service between Vancouver and the Phoenix region.

As part of this service package, BNSF is offering the rail industry's first Carload Service Assurance Program, including Guaranteed Service, Service Insurance and a No-Strings Option.

The marketing agreement is the latest in a series of co-operative ventures announced by CN and BNSF following their decision last July to terminate their combination agreement. The railroads have recently implemented:

- A service agreement creating a bimodal RoadRailer network linking
  Montreal, Toronto, Chicago and the Pacific Southwestern states of
  California and Arizona for perishable and dry van traffic, and
- A second service agreement providing agricultural products new
  efficient routings over CN and BNSF lines in Illinois and Iowa.

CN spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key cities of Toronto, Buffalo, Chicago, Detroit, Memphis, St. Louis, and Jackson, Miss., with connections to all points in North America.

Headquartered in Fort Worth, Texas, BNSF operates one of the largest rail networks in North America, with 33,500 route miles of track covering 28 states and two Canadian provinces.