Northland railways merger will put new face on old industry

Three Northland railroads under the Canadian National corporate umbrella are merging into a single U.S. subsidiary.

The merger means two railroads that helped connect the Twin Ports to the Iron Range and Canada for more than a century — the Duluth, Missabe and Iron Range Railway and the Duluth, Winnipeg and Pacific Railway — will officially be absorbed by the Wisconsin Central Railway. Though CN has been operating the railroads for years, their merger into a single U.S. corporation was approved by the U.S. Surface Transportation Board just last month.

“The DM&IR and DWP will cease to exist as separate corporations, and all operations would be as the Wisconsin Central,” said Patrick Waldron, a CN spokesman in Chicago.

The merger won’t affect what the public sees — most trains already are painted with CN on the side. It also won’t affect local operations, Waldron said.

“Most people won’t notice a thing. For employees, it’s going to mean the company on their paycheck is Wisconsin Central,” he said.

CN officials now are negotiating with union leaders representing workers at all three railways in hopes of moving all employees under a single contract.

Waldron said CN hopes to have the deal done by the end of the year.

The move will streamline corporate issues but also allow more free movement of trains between the three railroads. Under U.S. railroad laws, the three railroads currently are considered separate entities, and CN must change crews as cargo moves through the region.

“We think this will actually expand opportunities for some of the DM&IR employees who face seasonal issues with taconite; give them opportunities to work on the Wisconsin Central line,” Waldron said.

CN currently has 1,400 employees under their Wisconsin Central subsidiary, 110 in the DWP and 361 in the DM&IR. CN operates major rail yards in Proctor and Oliver, outside Superior, as well as the ore docks in Duluth and Two Harbors. CN also owns the Great Lakes Fleet of freighters.

Keith Stauber, an engineer with the DM&IR and then general chairman of Division 163 of the Brotherhood of Locomotive Engineers and Trainmen, said federal law allows CN to merge unions representing employees at the three railroads but that cooperative negotiations continue.

“They have the right to do this, but we are trying to work in the protections people want for long-term employees who don’t want to have to move to keep their jobs,” Stauber said. “The goal is really to let people continue to work in the areas they are working.”

Stauber said CN has been hiring at a rapid pace to keep up with the improving economy and he doesn’t expect any layoffs caused by the merger.

The Duluth, Winnipeg and Pacific runs from Rainy River, Ontario, to Oliver, Wis., and has been running CN trains for years, moving huge amounts of cargo imported into Canada from Asia and destined for the U.S. Heartland through Chicago. That market is beginning to recover from the global recession, Waldron said.

The Duluth, Missabe and Iron Range Railway has for decades moved Iron Range taconite iron ore to Duluth and Two Harbors for shipment to the lower Great Lakes. Taconite shipments on the railroad are near all-time high levels.

The Wisconsin Central line runs from Superior to the Chicago area with several spur lines. Waldron said Wisconsin Central is the largest of the three lines.

CN facts

About 22,000 employees in U.S. and Canada.

More than 20,600 miles of track in North America.

Earned $8.2 billion in revenue in 2010.

Tags: iron range, twin ports, business, news, transportation, duluth, superior