BORDER LINES

A roundup of North American news:

Lost in all the hullabaloo about the Canadian National (CN) and Burlington Northern Santa Fe railroads' cancellation of their planned merger was big news involving Canada's rail system. The same day that CN and BNSF made their announcement, Canadian Pacific Railway Co. (CPR) and Canadian National announced that they would share track in Ontario, the Midwest, and the Northeastern United States. Under a five-year agreement, CPR will move CN's forest-products traffic to distribution centers in New York and Pennsylvania, and will interchange that traffic with other railroads in those states. The agreement may be extended to include other commodities. Under a second, three-year agreement, CPR will route at least 14 general merchandise and/or intermodal trains per week over CN's Toronto-Chicago line. This marks the second such instance of cooperation between the competitors; earlier this year they consolidated short stretches of track in Winnipeg, Edmonton, Ottawa, and Toronto.

To no one's surprise, labor has emerged as a top issue for Air Canada, which officially took over rival Canadian Airlines in early July. During the last two months, the airlines' parent corporation negotiated agreements with several unions to implement wage and benefits parity between Air Canada and Canadian Airlines. But a contract dispute with the Air Canada Pilots Association (ACPA) has kept the two sides in on-again, off-again talks since late May. The pilots' concerns include job security, a possible reduction in aircraft, and a planned low-cost/low-fare subsidiary carrier. In mid-July, ACPA left the bargaining table and Air Canada withdrew its offers. The airline requested a government-appointed mediator, but at press time, the pilots had not agreed to that measure. A strike remains a possibility, although under Canadian law, unions must give management 72 hours' notice prior to launching a strike, and at press time, the pilots had not issued such a warning. Meanwhile, an amendment to the Canada Transportation Act that gives the federal government broad powers to protect consumers and foster airline competition-specifically aimed at Air Canada-took effect on July 5.

NAFTA Notes: Consolidated Freightways has opened a terminal at Torre�n Coahuila, its eighth in Mexico. The terminal will serve the cities of Torre�n, Gomez Palacio, Durango, Lerdo, and Parras. IFCO Systems N.V. has announced that its agent, PalEx, has introduced the "FLEX" pallet-pooling program in Canada, which lets customers own or rent as needed through IFCO's 10 Canadian depots. Penske Truck Leasing Co. has agreed to acquire Rentway Ltd., a truck-rental and leasing company based in Mississauga, Ont. Rentway operates more than 10,000 commercial tractors, trucks, and trailers through 40 service and maintenance facilities throughout Canada. Canadian National has made two major operational improvements this summer. In June, the railroad cut almost 24 hours off its transit times for intermodal service between Toronto and Winnipeg, Saskatoon, Edmonton, Calgary, and Alberta. In July, CN launched four fast domestic trains between Toronto, Montreal, and the Maritime Provinces, including a dedicated Toronto-Moncton-Halifax train that cuts transit time by half a day.