CN: ‘DSR’ Is the New PSR, But $150M Cheaper

17.February, Montreal QC – CN President and CEO, JJ Ruest, and the company’s EVP and CFO, Ghislain Houle addressed the Citi 2021 Global Industrials Virtual Conference, announcing that multiple initiatives they are employing will see DSR as the next step in safety and cost savings. Houle said, “Technology will fundamentally change the way we operate … [technology] is about value creation, but first and foremost this is all about safety.”

CN DSR
Digitized Scheduled Railroading incorporates these six components {CN}.

What turns PSR into DSR?

What is DSR you ask? According to Houle, Digitized Scheduled Railroading is the new PSR, calculated to improved safety, more reliable service, increased efficiency and productivity, and will reduce costs by up to CDN$150M by 2023. The six components of DSR are:

  1. Autonomous Track Inspection Program (ATIP) – the ATIP program is geared at providing increased track inspection, improving loss prevention, unlocking new capacity and using AI technology to detect defects that aren’t seen through in-person daily inspections. The ATIP data is used to assess the effectiveness of railroads’ track maintenance and inspection processes, provides data to assess track safety trends, and provides data to assist in making repairs and improving safety and maintenance quality. CN has been deploying the technology in specially equipped boxcars that are then sent out in regular train movements to cover all portions of the network continuously.  In by-gone days, railroads would have an inspection or geometry car dispatched to various lines a few times annually to look at the data.  This supplements that technology by offering daily and or weekly data in the same manner but deployed through the AI technological boxcars.  A total of 8 of these cars exist today and two more are to be online during early to mid-2021.
  2. Automated Inspection Portals – Aimed at reducing the miles and human error potential in mechanical inspections, the AIP program is a step up in the inspection frequency and quality of train inspections through the use of ‘portals’. These portals use dozens of cameras and computer systems that analyze every aspect of the equipment passing through, including providing service data for locomotives and other information that can be relayed to the next terminal the train will utilize.  The portal is reportedly capable of detecting cracks in wheels or coupler systems as well as much larger defects that could potentially pose a safety risk or even cause significant damage.
  3. Handheld Technology – Tablets are being deployed to conductors and train crews to modernize processes and improve customer satisfaction through a switching window advisory. As explained, this technology can provide a customer of real time data when a switch or service is expected or as it is happening.
  4. Process Automation – This is geared at eliminating manual processes and associated costs through the use of Robot Process Automation and Optical character recognition (OCR) technology for automating data extraction from printed or written text from a scanned document or image file and then converting the text into a machine-readable form to be used for data processing like editing or searching.
  5. Handheld Technology for Mechanics – Tablet technology is being deployed for the mechanical forces that provides a set up in data accuracy, timeliness and mechanical productivity that will return assets back to revenue service more expeditiously.
  6. Smart Network – While not specifically defined and reportedly evolving, the smart network is geared at better planning that will unlock new capacity and better service reliability.

The most noticeable of these initiatives will be the ATIP program with their white and orange boxcars easily identified and the AIP ‘portals’ which look like pole buildings erected over the mainline at various locations.  Both are to significantly increase in frequency during the next few years.

Ghislain Houle, EVP, CFO at CN said during the conference, “Technology will fundamentally change the way we operate, and it’s starting to reflect itself in our earnings and the operating ratio.  Technology is about value creation, but first and foremast this is all about safety.”