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Union Pacific raises revenue in auto business

The Union Pacific Corporation railway company increased freight revenues in the automotive sector, within its Industrial business, 5% in 2021, to 1,761 million dollars.

In 2020, the company posted a year-over-year drop of 21 percent.

Union Pacific is the largest automotive carrier west of the Mississippi River, operating or accessing 38 vehicle distribution centers.

The extensive freight car franchise serves five vehicle assembly plants and connects to West Coast ports, the six major gateways to Mexico and the Port of Houston to accommodate import and export shipments.

In addition to transporting finished vehicles, the company provides expedited handling of automotive parts both in vans and in intermodal containers destined for Mexico, the United States and Canada.

Overall, the diversified freight car business mix includes Bulk, Industrial and Premium.

With some 10,000 customers, Union Pacific serves many of the fastest growing population centers in the United States, operating from all major West Coast and Gulf Coast ports to eastern gateways, connecting with Canada’s rail systems and is the only railway serving all six major gateways to Mexico.

Union Pacific

In 2021, shipments from its Premium business generated 31% of total freight revenue.

The premium includes finished automobiles, auto parts and goods in intermodal containers, both domestic and international.

Likewise, the international business consists of import and export traffic that moves in 20 or 40-foot maritime containers, which pass mainly through ports on the West Coast, destined for one of the company’s many land intermodal terminals.

Domestic business includes container and trailer traffic picked up and delivered within North America for intermodal marketing companies (primarily shipping agents and logistics companies) as well as trucking carriers.

Premium includes shipments of finished automobiles, auto parts and merchandise in intermodal containers, both domestic and international.

Premium shipping freight revenue increased 11% in 2021 compared to 2020, despite weather disruptions in the first quarter of 2021, driven by higher fuel surcharges, base price gains and a 2% volume increase.

Auto shipments of 173,000 freight cars in the second quarter of 2021 were more than double the 79,000 freight cars in the same period in 2020, as North American manufacturing plants suspended production due to the pandemic in that year. .

This recovery hid the impact on auto shipments in 2021 due to the continued shortage of semiconductors. Excluding the second quarter, auto shipments fell 14% year over year.

 

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