CN Rail is on the move to Mexico

Pizza Pizza isn’t the only Canadian entity heading to Mexico. Soon, Canadian railcars will be making like us on Spring Break and taking trips down south. 

What happened: Canadian National Railway is rolling out a shipping service that will carry freight from its Canadian origin points to Mexico, Canada’s third-largest trade partner. It’s called Falcon Premium, which, frankly, makes it sound way cooler than it actually is.

Falcon Premium arrives a month after Canadian Pacific Railway (now CPKC), the Federer to CN’s Nadal, received approval for its US$31 billion merger with Kansas City Southern—a union that created the first single-line railway connecting Canada, the US, and Mexico. 

  • CP Rail’s acquisition of KCS was contentious, to say the least. KCS originally signed a merger agreement with CN Rail, but the deal was scuttled by US regulators. KCS went on to terminate the merger agreement and accepted a bid from CP Rail instead. 

Why it matters: Canadian railways already move ~$350 billion worth of goods each year, per the Railway Association of Canada. With trade between Canada and Mexico set to grow, rail will play a big role in keeping key Canadian exports like grain and lumber flowing.—QH