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Quebec Railway Corporation

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Quebec Railway Corporation

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    1. 1 Quebec Railway Corporation

    2. 2

    3. 3 Quebec Railway Corporation The leader in regional railway transportation Owner of six railways and one rail car ferry Active in 4 Canadian provinces: Quebec Ontario New-Brunswick Nova Scotia An integral part of the NAFTA rail system CN’s most important Short Line Railway partner Major service provider to VIA Rail Canada, east of Ontario.

    4. 4 Assets Significant presence in Eastern Canada Six railways and one rail car ferry

    5. 5

    6. 6 Transported goods

    7. 7 A look back to 2003

    8. 8 MISSION

    9. 9 CORE VALUES

    10. 10 OUR RESULTS

    11. 11 Train Incident Ratio

    12. 12 A True Safety Culture In order to achieve these excellent results, we are continuously implementing a true safety culture amongst all employees. ACTIONS Convince employees that it is possible to completely eliminate accidents. To let go those who do not want to abide by this culture. Hire only people with an inclination for safety by ensuring that hiring practices identify desired behaviours.

    13. 13 A True Safety Culture (cont’d)

    14. 14 A True Safety Culture (cont’d) CEO leads the monthly safety conference-call to which all operation supervisors are required to attend. All non-union employees must meet their own personal safety objective, whatever their job is in the organisation.

    15. 15 Major challenges for QRC and its Subsidiaries The Forest Product Industry Our main client is in crisis Plant reorganizations and closings Main causes: Increase use of the Internet Housing starts are down in the U.S. Worldwide competition

    16. 16 Major challenges for QRC and its Subsidiaries (cont’d) Significant impact on our results Need to develop new business opportunities

    17. 17 Major challenges for QRC and its Subsidiaries (cont’d) Passenger Train Service VIA RAIL uses our rail network for its Eastern Transcontinental service 75% of our main line is shared between VIA RAIL and our freight trains

    18. 18 Major challenges for QRC and its Subsidiaries (cont’d)

    19. 19 Major challenges for QRC and its Subsidiaries (cont’d) Federal Excise Tax on fuel Tax created in 1985 as federal deficit reduction measure Deficit eliminated in 1997 10 years later, this tax is still in force

    20. 20 Major challenges for QRC and its Subsidiaries (cont’d) The U.S. Government has eliminated its own excise tax When is it our turn?

    21. 21 Major challenges for QRC and its Subsidiaries (cont’d) Capital Cost Allowance (CCA) Depreciation rate is lower for rail than for other modes of transportation: Railways: Rolling equipment: 15% Roads and bridges: 10% Trucks: 40%

    22. 22 Major challenges for QRC and its Divisions (cont’d) Trailers: 30% Vessels: 33% Aircrafts: 25%

    23. 23 Major challenges for QRC and its Divisions (cont’d) In the US, the rolling stock is entirely depreciated within in 7 years In Canada, it takes 20 years Canadian railways are more taxed than U.S. railways: Canada: 9.13% of revenues U.S. 5.41% of revenues

    24. 24 Major challenges for QRC and its Divisions (cont’d)

    25. 25 Major challenges for QRC and its Divisions (cont’d) Municipal Taxes We pay municipal taxes on our rail infrastructure It is a complicated and arduous process For example, NBEC must handle more than 77 individual municipal tax accounts

    26. 26 Major challenges for QRC and its Divisions (cont’d) Roads are exempted from municipal taxes So, why aren’t we?

    27. 27 Major challenges for QRC and its Divisions (cont’d) Federal or Provincial Jurisdiction In New-Brunswick, our railroad is under provincial jurisdiction Hence, we must pay for regulated inspections performed by Transport Canada

    28. 28 Major challenges for QRC and its Divisions (cont’d) Moreover, we do not have access to federal funding to improve railroad crossings .

    29. 29 Regional lines - A privileged link Regional lines are: A privileged link between communities and enterprises in regions and North America and international markets We must improve our profitability in order to continue to play this key role

    30. 30 Regional lines - A privileged link (cont’d) We must also improve our infrastructure We cannot do it alone A public-private partnership is required

    31. 31 The Future The future is: A public-private funded program in each province similar to the one Quebec is preparing to implement in order to help finance the infrastructures required to respond to the needs or companies and communities The elimination of the 4˘/litre excise tax on fuel

    32. 32 The Future (cont’d) The rate of CCA for rolling stock and railroads and bridges should be brought to 30% The elimination of municipal taxes on railroad infrastructure The possibility for railroads under provincial jurisdiction to have access to federal funds to improve railroad crossings

    33. 33 Quebec Railway Corporation THANK YOU FOR YOUR ATTENTION

    34. 34 Quebec Railway Corporation Marc Laliberté President and CEO Tel. : (514) 982-9944 Fax : (514) 849-2319 Cell. Phone : (514) 972-8694

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