Canadian National Railway CNI
CN, once the best-run Class I railroad, is now the worst under CEO Ruest; abandon the KCS deal and install Jim Vena to restore operational excellence.
Thesis
Canadian National, historically the best-operated Class I railroad, has slipped to the worst operating ratio in the industry under CEO Jean-Jacques Ruest, with operating profit flat since 2016 while every peer has grown 3-8%. CN is the only major railroad still below pre-pandemic levels on revenue, EBIT, OR, RTMs and pricing, and has lost senior operating talent (Creel, Vena, Foote, Harris) to competitors. The defensive copy-cat C$2bn bid for Kansas City Southern, blocked by the STB, compounded the strategic and governance failures. TCI, holder of more than 5% of CN's shares (~$4bn), demands the board abandon the KCS deal, replace Ruest with proven railroader Jim Vena, and add Gil Lamphere as a director, citing the Hunter Harrison turnarounds at CP and CSX as the playbook for what disciplined operational management can achieve.
SCQA
Canadian National is a Class I railroad with the best network in North America and was historically the most efficient operator, posting the best operating ratio in the industry as recently as 2017.
Under CEO Jean-Jacques Ruest (since 2018) CN has the worst operating ratio of the Class I peers, no operating profit growth since 2016, a failed C$2bn KCS bid, and an exodus of senior operating talent.
Withdraw the KCS agreement immediately, replace Ruest with proven railroader Jim Vena as CEO, add Gil Lamphere to the board, and hold directors accountable for the underperformance.
Restoring operational discipline can replicate the Hunter Harrison playbook at CP (EBIT +142%, OR -1,660bps) and CSX (EBIT +47%, OR -1,100bps), closing CN's wide stock-return gap to peers (36% vs 77-118%).
The three reasons
- 1
CN is the only Class I railroad whose operating profit has not grown since 2016
- 2
CN went from best operating ratio in the industry to worst under current CEO
- 3
Failed Kansas City Southern bid was a defensive copy-cat misadventure
Primary demands
- Withdraw from the agreement to acquire Kansas City Southern
- Replace CEO Jean-Jacques Ruest with Jim Vena (former UP COO)
- Appoint Gil Lamphere as a director to add railroad expertise to the board
- Build a management team with deeper operational railroad experience
- Hold the board accountable for recent underperformance and the failed KCS bid
KPIs cited
Pattern membership
Where this document fits across the library's 12 rhetorical / structural patterns.
Precedents cited
- Hunter Harrison & Keith Creel turnaround of Canadian Pacific (2011-2014)
- Hunter Harrison & Jim Foote turnaround of CSX (2016-2019)
- Jim Vena turnaround of Union Pacific (2018-2021)
- CN's 1995 IPO 'Pig That Flew' history
Notable slides (6)
Notes
Classic TCI peer-gap deck: nearly every slide is a single bar chart showing CN highlighted in orange against blue peers, hammering the same comparative-underperformance message across operating profit, OR, revenue/RTM, expenses/RTM, labour/RTM, RTM/employee, ROE, and stock returns. Strong rhetorical use of the 1995 'Pig That Flew' book quote ('dead last' on labour productivity) as a 25-year callback, and the Ruest CEO quote about not running for OR is used as the contradiction setup. Conclusion slide (p21) is the explicit ask: withdraw KCS deal, install Jim Vena as CEO, add Gil Lamphere to board. Page count appears as 26 in skeleton but visible body ends at p21 with appendix divider on p22; appendix not sampled. Stake stated as 'more than 5%' — recorded as 5.0 floor.