Shippers: Union Pacific Problems Persist

Theres been no improvement in service on the problem-plagued Union Pacific (UP) railroad, indicate member surveys by three major industry groups representing shippers--the Chemical Manufacturers Assn. (CMA), the Society of the Plastics Industry, and the National Industrial Transportation League. The problems that have plagued UP since its merger with Southern Pacific railroad in 1996--including lost rail cars, labor troubles, and computer glitches that slow train speeds--"have cost shippers hundreds of millions of dollars," says CMA, whose own members report losses of more than $300 million between June 1997 and January 1998 as a result of the deteriorating service.

The three associations are expected to ask the Surface Transportation Board, the federal agency that oversees rail matters, to extend its emergency service order that expires March 15. The order authorizes certain UP shippers to route their shipments on the Texas-Mexican and Burlington Northern-Santa Fe railroads and around the Houston area, where UPs problems are the worst.

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