KCS expects to smooth out cross-border issue with unions

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A Kansas City Southern crewman climbs aboard a northbound intermodal train on the International Bridge linking Laredo, Texas, and Nuevo Laredo, Mexico, in November 2017.
Bill Stephens

DANA POINT, Calif. – Kansas City Southern and unions representing train crews will eventually iron out their dispute over the use of Mexican crews to handle cross-border trains at the Laredo, Texas, gateway, a railroad executive told an investor conference this week.

“We think we’ll work this out with the unions and become a much more efficient railroad and increase capacity across that international bridge,” KCS Chief Financial Officer Mike Upchurch says.

In July, KCS shifted the crew-change point for cross-border trains to Laredo Yard, about 9 miles from the International Railway Bridge across the Rio Grande, a move disputed by its unions. [See "KCS begins using international crews at Laredo gateway after judge blocks strike," Trains News Wire, July 10, 2018.]

U.S. and Mexican crews previously exchanged trains on the single-track bridge, a practice that created delays and limited capacity at the busiest U.S.-Mexico railroad border crossing.

“Stopping on the bridge causes fluidity issues,” Upchurch told the Morgan Stanley Sixth Annual Laguna Conference. “You just don’t have as much capacity if you’re stopping and people are walking across the bridge to the locomotive.”

KCS says moving the crew-change point, along with customs process improvements, will boost the capacity of the bridge to 35 to 40 trains per day, up from the current 25 or so.

“For us, it’s not about labor savings,” Upchurch says. “In fact, we’re going to add 25 people in the union at the yard in Laredo. All you have to do is look at our growth that we experienced in the second quarter.”

KCS is hiring to keep pace with surging cross-border traffic, which grew 13 percent in the three month-period ending June 30. Intermodal and petroleum products exports to Mexico showed particularly strong growth.

“This isn’t about eliminating jobs,” Upchurch says.

In July, a federal judge blocked a planned strike by the Brotherhood of Locomotive Engineers over the crew-change issue. The judge’s order, which referred the matter to arbitration, dismissed several concerns that the union raised regarding the training and qualification of Mexican crews.

The union has taken its case to the White House and Congress while continuing to contend that the use of Mexican crews poses a safety issue. [See "KCS disputes union claim that cross-border crews are unsafe," Trains News Wire, Aug. 8, 2018.]

The Federal Railroad Administration reviewed and approved KCS’s plans to use Mexican cross-border crews. The operational changes mirror practices long used at the Canadian border, KCS officials have noted.

Last week the BLET was joined by the SMART union in filing a petition against the FRA in the U.S. Court of Appeals for the District of Columbia Circuit.

The unions’ petition claims that the FRA exceeded its authority and seeks agency records regarding review and approval of the use of international crews.

The FRA must reply to the unions’ petition by Oct. 5, according to federal court records.

An FRA spokesman said the agency does not comment on pending litigation.

— For more information about KCS and its cross-border network, see "The NAFTA Railway Survives," the cover story in the October issue of Trains.

NEWSWIRETrains News Wire

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