UNP - Earnings call transcript Q1 2021 | Union Pacific Corporation

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Operator

Greetings and welcome to the Union Pacific First Quarter 2021 Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded and the slides for today's presentation are available on Union Pacific's website. It is now my pleasure to introduce your host, Mr. and Union President Chairman, Fritz, CEO Pacific. for Lance you, Mr. Thank Fritz.

You begin. may

Lance Fritz

Omaha and good call. Union in Vice Executive President, and Jennifer rocker, you Sales our Operations; welcome President With Eric of Vice morning, today Marketing conference Thank Executive earnings Chief everybody to Financial Kenny Gehringer, quarter Pacific's me and and are Hamann, first Officer.

the March. in quarter I we unprecedented employees nearly of work made during our February communities want for experienced surface we early recognize Before major to results, serve events discussing weather Many damaged first the conditions transportation and winter factories their faced impossible. that and

homes Our the gratitude resiliency, maintain as dedication while and or owe proved employees a those to to to their they serve. impacts areas again the dealing in rose occasion restore with our critical own art team families. their debt to We of and service weather grid their to

results, quarter the to is or quarter of This Pacific compares per this $X.X Union of first XXXX. $X quarter share. or in share income on billion $X.XX net Moving a morning first first billion XXXX reporting $X.X

prices quarterly the impact of fuel reflecting ratio quarter. came the Our and rising in XX.X%, weather operating at in

year. core XXX I remain team, optimistic the see As hear on performance, core very based you the our productivity will from challenging about basis delivered in remainder these results items, strong and We our improved points. conditions of and the

our XXXX are affirming fact In we guidance.

volume. our We're to advantage economic take it grow outlook improving was quarter, position terrific While in of a not tough does our expectations. a that the dampen and

us turn reviewing outstanding productivity to update. set for it year. an the and details, service Our To up us continuing will structure for cost over operations Eric I product, an started get our

Eric Gehringer

The to transformation this Thanks, Lance, network. had operating to PSR a challenges testament on team our network numerous challenge The weather morning. rose quarter the operations. across of team the with recovered and the speed which is it the as past responded the to good has

the Moving as in with operations X, solid XXXX were across board rough we indicators smooth performance to the Slide running began January. strong key and

and is they However, we a particular to the winter across not the in in heavy challenges our had accustomed The impact. South whether March faced network faced. weather February

region In weather temperatures worst Through to the across second impact the our fact, to team's service. our network in able southern recovered we of and hard represented XX cold quickly, stretch mitigate, work the years. were of most our the over

recovered compared significantly from our experienced In twice XXXX before we fact, fast and implementation disruptions faster than to of any as recovery we flooding PSR. in the

team operating of the to While is impacted results mixed of return our frustrated improvement of measures all through state dwell Slide velocity, freight in freight car see you results you car Weather we will train terminal on constant the execution these the transportation and plan. with see heavily X, a speed.

However, trip plan Intermodal improvements decreased in on as transportation significant through make we that efficiency surge and continual our improved adjustment efforts weather compliance measures XX% as in pressure a driven good placed of link. quarter. were and on to shipments grow the as continued in evaluation productivity progress of as by our and locomotive These plan the continue workforce our to both well year-over-year train service. our quarter intermodal

team Our product this for did compliance quarter, of highlights the service maintaining weather recent our and Slide X service excellent trip the manifest manifest changes. solid plan of remained some in network improvement throughout job driving during impact. an The autos.

XX% in year extension this enabler which productivity is length One length while train or to progress of was the quarter, almost over provide better siding XXXft product drive push continue striving service up to our a was Train to feet great our We to customers. program. X,XXX first year.

construction began or During sidings. the and quarter, process, the two and another XX bidding we completed sidings

make Houston the area We to drive in redesign continue efficiency. in to the operations our of progress

facility the our This the operations leveraging reducing allowing of we at and to customers, yards and are allows the our deliver yard, bypass consolidated cars investment extra smaller time start. to smaller blocking around four of at recent directly handlings, of us us area. We crew those yards transit eliminating curtail Englewood to our local Settegast the and cars improving

operations will We Council North starts. reduce surrounding which also curtailed leveraging our yards, at local by Bluffs train yard switching

initiatives about enhance the As and have to our future, the productivity service I look of drive to we full excited network I'm pipeline our throughout product.

to accomplishing focused and to safety, We it as the need today provide plan an safely importance the service on our over done productivity on to there we focus transformed level business improve have with mid the of and providing 'XXs, to principles work. Slide return we path to our trip plan still reliable our freight highly us fully We our opportunities and drive to the 'XXs. PSR do executing the X; With I product. many goal. the remain with operation is expect. product return the that improvement and to and to remain we service understand upper the 'XXs our work that, velocity, to on on a compliance We're we car for we to update to Kenny the have achieve plan mid our operations do We will recognize that customers low environment. towards low need continuous turn compliance we to to trip Turning manifest everything make intermodal the to right

Kenny Rocker

you, morning. and good Thank Eric,

weather events leap ago Our first the XXXX. quarter volume from year was down and in year to X% a due

in intermodal that industrial our due with in market. quarter for volume, by revenue our were markets energy decrease were related negative the Freight surcharge the offset the declines and grain business core in down pricing. was fuel offset X% export mix Solid and offset...that to lower by our on coupled gains

sulfur. volume X% Starting which was with Let's our bulk decreased quarter. each X%, were first a carloads at groups by high a were how decreased down X%, weather take as pandemic quarter Coal demand and a stronger the food the our to industrial pricing And positive the refrigerated of as X%, and service partially levels, higher primarily revenue as which closer continued offset Fertilizer potash food car, for the per core our traffic performed as well challenges, down markets, volume increased due export demand law by by business prices. ongoing in XX%, natural look grain. by for X% were partially and revenue was customer partially driven was down driven weather-related due of in offset contract Volume mix XX% increase for offset down finally, gas grain by was renewable export average to and gains. reduced and grain inventory in result by shipments up for related challenges. for products carloads were demand

Moving decrease on fuel XX% to a declined in shipment also to industrial car and reduced by XX% by industrial, due oil surcharge primarily and lower specialized an demand. Average XX% drag unfavorable shipments crude driven revenue decreased revenue X% and mix. per declined the quarter, volume. for driven reduced from Energy price

products repair an starts, grew strong housing driven remodel. in and by Forest lumber was by increase along with volume X%,

sand. inventory. brown cost plant Industrial We February feedstock throughout for minerals as drilling was to and and severe due softness Metals in increased for driven the demand paper, storm well the frac as also strength by Coast driven by interruptions XX% down sand volume local in producers coupled the X% in primarily in market shortages certain that surplus the with low in down and shipments associated shipments and in sectors. rock with weather chemicals quarter, reduced Gulf were May saw and plastic box and decline

recent was premium, mix container up a and Turning effect revenue from by the automotive greater for parts due Intermodal strong in to for X% sales by volumes manufacturers in fewer and auto to import. benefited parcel volume intermodal quarter e-commerce. struggled XX%. ongoing and volume now despite shortages in down retail weather grew with chain. quarter volume reflecting supply and the in disruptions vehicle Average revenue continued auto X% the from was extreme Domestic land down in was down volume. growth quarter. part finished up strength International vehicles, part, poor containerized intermodal carload XX% to related shipments Finished business X% as in X% similarly declined particular Automotive to strength impacted shipment. car and winter congestion per year-over-year semiconductor-related XX% increased on were increase XX% XX% the with

prices XXXX, outlook increased and contract demand presents Now continued sources our other looking ahead bulk to levels, a natural electricity forecasted the improve market. with demand for are commodities, rest combined to law customer and a have challenging inventory a of gas for expect energy we coal, high for negative

year. with year, remains China ag the strength of comparison XXXX back export incremental continued calendar year-over-year clearly in for as is product there a However, half the committed in purchases to tougher grain

We drive new production optimistic new and renewable shipments will as is volume to our feedstocks bulk which with facility finished at also diesel UP for are destination products. biofuel domestic increase, expected

industrial look in our recovery our As favorable of those ahead we commodities, speed market is there the with still uncertainty for however, energy year-over-year to are the comps the markets.

we closer a from encouraged Automotive we our XXXX point increase. forecast since in We the spoke industrial strong units stronger in strong Plastic businesses. rates by for forecasted intermodal premium, also in remain for XXXX to forecasted year in at improvement to And million us uplift now to $XX XX XXXX. January. as million will increase are X% both in expect and volumes production lastly, is X.X%, XXXX for Full automotive are sales production.

second restocking regard optimistic should truck road along to expected for intermodal encouraged that conversion low, this We automotive supply we're the sales higher volumes, Retail of chain rail. normalize intermodal, in are to historically parts the With and over from production will inventory quarter. Limited continued issue in year. with remain drive inventories truck to later strength capacity improve are

to I'll our express operations to our and customers work the this review their new and to unprecedented March. and dedication in to our Jennifer keep weather Both quickly for our to for running hard turn over it network that, my together I'd bit. Before and financial operating like win I teams appreciation to engineering in February work hand to and recover over event Jennifer, teams performance. our commercial closely With operating

Jennifer Hamann

Kenny quarter Thanks. ratio on and operating look first to start at morning, good per earnings a Slide XX. the going and with share I'm

of basis share quarter discussed results quarter ratio impacted $X.XX XXXX per by of Union XXX extreme $X As operating first XX.X%. from our weather and to negatively Pacific ratio reporting you is first winter or Comparing operating Lance, the our points quarterly a earnings previously heard earnings.

our In lag our XXX operations core adding our fuel $X.XX operating and throughout fuel impacted quarterly associated on surcharge per per improve, delivering quarter points the earnings basis and continued to these ratio by share. profitability ratio and prices recovery challenges, points our or rising XXX of programs Despite X-month the addition, share. benefit basis to $X.XX

to our decrease. costs X% Looking now expense income X% down first on versus $X year-over-year billion to our billion, on XX, statement Operating quarter ability decreased volume X% at $X totaled Slide adjust operating a volume. revenue demonstrating consistent than more XXXX

X% quarter a average resulted offset $X, expense X% income our share share we XXXX in to debt an debt combined weighted year. to versus X% of XXXX repurchases operating billion due exchange decreased together, of $X.X lower of pre-tax fees are from net from in decrease X%. Taken billion, versus lower per income resulting related some which last decreased income, tax to when X% earnings income down level, with $X reporting first compared Interest increase increased with

negatively XX revenue on compared to lag the more closely decrease freight leap revenue was as in slightly basis impacted basis $X.X surcharge at by impact a year. freight last The and freight year fuel points fuel down recovery and weather by X% XXX billion, driven breakdown as last prices. Factoring Looking compared a year, lower volume XX Slide the revenue; decrease. a totaled XXXX. quarter of surcharge first which being revenue to Fuel point well was provides our

Our in yield continue pricing inflation. of dollars to excess actions pricing

freight and However, those XXX basis gains were reduced negative points. mix business by revenue more a than offset

petroleum volumes coupled shipments grain than by was very declines our impact in strong in and this with the industrial intermodal offset shipments. product quarter, Although increased more

to a provides our which benefits Starting Now XX operating quarter expense and Slide of on year-over-year. first down expenses. with move compensation let's summary X%

XX% volume. declined equivalent full-time levels strong very against in workforce XXXX only a decrease quarter generating about productivity X% First or

volume an to inflation and employee, up and than we weather-related this together engine as prices. as wage headcount-based lower XX% crew Quarterly decreased elevated X%, a engineering incentive management, Specifically, some higher our volume was down be and continues XX%, fuel year-over-year decreased and variable as per more tightly Offsetting while mechanical higher of costs. XX%. compensation expense managed of workforces workforce cost productivity result well train

productivity fuel our of offset the our utilizing by maintenance costs rate result extremely the auto and as offset ownership well were as a additional partially as by fuel a expenses. savings expense temperatures. and cold volumes result improved smaller related fell as were equity additional drayage was services Equipment Our loop of materials equipment needed in Purchased other X% a subsidiary by by consumption rents flat initiatives fleet. driven X% essentially from lower driven active as income to These TTS. higher weather-related less

The casualty related on of increase to viewed line as an expenses quarter claims. increased adverse this safety other driven expense certain be indicator higher XX record. developments million primarily that should were current This by not

impacting for expect second materials and predominantly management actions as in temporary forward These mid-single and purchased purchased going and reducing in excluding, other versus to services recall last As second comparison to a about pandemic and closing year expenses, that and actions services compensation XXXX. quarter Xrd both took we a produce digits for benefits the think headwind be salaries the total we in X% and shop. We full-year up and quarters. as response expenses expense material expenses now well

productivity Productivity generating improvement solid by trend we and previously earlier. our XX, Slide continue again our the productivity the were as $XXX to length effective Eric rate million to first tax spite led be on than strong in $XX higher in workforce annual quarter we of at around now expect looking XX% detailed Lastly, million. headwind, locomotive slightly weather contributing train productivity results thought,

free from Turning XX also of dividends billion flow, we billion cash confident start averaging flow balances production our to programs. pace $X ability $X despite first increased capital after more XX; the our in slow Slide performance maintained coal three declining by year-end up the that cash productivity, cash decreased reasons volume to investments consumer 'XX. totaling flow during and our all improvement the $XXX in industry-leading forecast. semiconductor cash an first as of year, $X.X Free to slightly we to April. across to billion increased be volume, $X.X aside some in and strong lingering industrial closures Supported and after have debt-to-EBITDA the with and we shares and March, in industrial, quarter XXX,XXX we billion. or repurchase trajectory we And Slide a finished remain show headwinds price drivers' improving on face We flow on our crossed quarter. to about demand to to XXXX, ratio our X.X of returned a with shortage storm XXX%. strong continuing ability impact XX%. seen first with comparable The operations improving impact and decline a Wrapping billion, the drive slower even that vaccination autos are adjusted quarter the quarter, loadings cash Since do generation XXXX. million March capital there plant car demand, X.X an shareholders ongoing trade the seven-day that into XXX,XXX quarter Setting and a cash increasingly roughly a over the from are early payout business conversion This demand from the chemical about of and encouraged threshold to the plus we though, dividend X% railroad. X% times despite February in second to rollouts, optimistic is we highlighting the cash the our start generated well capital our as up par as rate to discipline

we're carload to our strength So full in growth year around volumes, now the expect we be with X%. seeing

full-year guidance ratio productivity Our to basis the intact. points, all operating around pricing, and XXX in of XXX improvement range remain

economic But we to initiatives, outlook, volume closer clearly work likely these of than updated traction XXX. achieve us our a to with the PSR goals. We give the a to broader However, good success. on will us have our be and ahead path picture XXX

well capital, below Turning guidance through remains long-term plan our for we our focus. generate the capacity our capital at cash $X.X billion year, PSR revenue within to and of as XX% of spending

dividend repurchases. committed share to will We industry-leading strong our payout maintain and are ratio

Specifically, repurchases. $X return shareholders to plan in through we to approximately XXXX our share billion

are Before our I'd workforce. to exceptional this I our again to customers. to turn thanks our challenges Mother my Lance, tested ready it committed serving like back workforce our they the capabilities and showed once add and Nature for are to quarter

I'll turn to back Lance. that, So with it

Lance Fritz

you, Thank Jennifer.

highlight in see, expectations As heard say today ability Day taking XXXX. we our protect our greenhouse will area. our you've planet. to science-based our to we're base appropriate by confident it With XXXX be by me feels emissions gas in XX% our In priority high being that reduce the the announced times, to to many Earth against actions February, first always meet I'm target

we Additionally statement to our strategy, America our with in out May going stakeholders. building building conjunction this Day. sustainable expand report, future call delivering our in rolled we Investor be We're proxy on which XXXX early to our we our strategy XXXX ESG our all XXXX, value a reinforcing in will which of in to commitment published is

future. we're today, optimistic heard you about As the very

top made service enabling structure line. will and us resilient business through to win expand cost Our and new PSR ultimately lower opportunities is product that grow more the

returns. excellent gives to is XXXX Looking exceeds long-term to strengthening commitment outlook, that take economy guidance. our industry us to a franchise in for and to of leveraging our by growth of confidence poised best rest opportunity pricing the the and productivity year Pacific Union improving value-based the inflation affirm and continued advantage economic produce to our strong

questions. let's with that, for open line So up your the

Operator

Amit question. proceed Thank our the Deutsche Mehrotra, from with question you. Bank. Instructions] is first Please of And line [Operator your

Amit Mehrotra

follow-up you went no guess time. for this Thanks. me from I

Good just to focus the improvement on stick one. margin basis just points this XXX I'll everyone. so Jennifer, morning, wanted Okay, year. of I to

think if that needs achieved could a bit what would sort be the year, kind better can but of impressive, high bit the to at that be you about of maybe it that OR better, I would implies be...which get year. getting in some quarter XXX this just target. of little a implies million little for about you XX.X guys if this mid half obviously think to a 'XXs you hitting I'm to mix XXX back year is talk more which the of end you wondering or talk

Jennifer Hamann

the thanks question. for So

mean XX.X I the to able points in yes, to year says we strong and very to improve So that off of hoping get get starting XX make improvement closer to over be certainly with said, XX.X of have to the and year a those and the balance improvement. we That range basis to as hit of XXX the we're to targets.

win in terms is it confidence, the so in gives And to the us marketplace. what of ability really

expecting XX%, quarter and mentioned still winning those in we we as As be with all seeing the that very weather are team first so again, quarter we're took Kenny year-over-year of toll they volumes so points fuel, was so, certainly positive on signs. basis or the in XXX you we're around efficiency piece, the OR. now core January the But then their improvement. might we new the generated impacted were original and up X% business strengthening our guidance to economy. back in recall and And

We volumes as about transitory some grow so the rest of the put and feel us. And of issues year. behind good to look we those

Amit Mehrotra

Thank you. Thanks.

Operator

of with comes question Group next from Our with question. Research. your Please proceed Scott the Wolfe line

Scott Group

going question. an on, just Thanks, Hey M&A given I everything guys. morning Lance ask to wanted good

network going have around thinking overall time, case now, change focus more more that's your on on view perhaps a wondered, So, then reach. over CN, you a it's a bigger on Cpk a that, growth to to is and and own more and on is that your and the do table I think one perhaps threat preference focused about ratio view specific I forward. have been sense if earnings M&A does volume one your in cause you transactions perhaps right extending guys the very time likely about to you, operating or of start of to you

Lance Fritz

really Yes. Thanks, an CN for whether we're the intact. current the in last is remain the is of first next Scott. with concern we're X KCS, says CPU regarding and that that product question-and-end the all improvement start to the part, to true with to It service our Class What competition the to is the has the must and STB be I'll acquire merger the our provide, or enhancement customers, focused clear with through same. transaction part the on any

of the you're We Union the they value opportunity then transaction. any XXXX-XXXX. a overall regulatory game in three three consolidation. legs think competition and parts, focused or XXXX to are impact Class and that or to X making So STB that that our focused then, customers the of further we're going we're by STB is context, the STB concern process rules in productive Class good both stools creates committed on the apply in all the we're with not very up what X marketplace, they operating focused I to a play merger to plan the for for We're operational efficient our those growth mergers in that they we're we're on created not potentially that's interest. in a that in other we growth X near commercial we're to or STB's the in as the active concern waiver on a stability STB first little acquirers of not stool, and as we're in currently incentives expense the regards also right. to we In the M&A we have to. this are sure for regards, best for weather on think every impacts you enhance and going an thing that we we of downstream competition making to exactly And on, does competition KCS is our value And interest and on if going our and as for get about and engaged value-based that potentially Mexico has review, focused the think in transaction, so and making to that sure to on to sure excuse Class that focused to railroad lot activity, bit playing drive pricing making access that first see level merger the We're CP sure be vet and is the on protect back merger, serve a opportunities the assets this making on that role, sets CN with on in big bigger field all at should whether remain railroad focused long-term industry a is very, changes apply the committed and full the look directly taking our foremost and to and enhancing focused us. the in the whether that the has me, seek sure stance enhance then Pacific, enterprise they help and new it

Scott Group

Okay.

future. So in and about concerns around thinking got both you're near sounds your it some you've M&A like not transactions

Lance Fritz

could and That's process. not the correct. continue be and Scott. we'll understand of to done are and we contemplating this benefits monitor plenty be what M&A, engaged costs we've just work At point, the to

Scott Group

I appreciate for it. Lance. the thank thoughts you Okay,

Operator

is Please from the question of proceed question. Wetherbee with Citi. your Next line Chris with

Chris Wetherbee

that has over progress of environment PSR some us growth of potential. of been the a morning! more the obviously to year, competitive thanks, give your going the in this about the including you that beyond into this its point the is go of just hey, where wanted United the of landscape company. multi-year your of the Lance, help course of couple be to some improvements is Yes, franchise, sort the growth but pick the bit States it you preview a outlook I if maybe does and maybe out gotten guess a up about context comments like in long-term of maybe of but you maybe you years, on think when some the potential opportunities seems good or how of think has bit growth competitive a of under some Western factor the for making you about year, favorable for last UP sort the to your little the to macro service

Lance Fritz

Chris question it. for and thank you Good asking

been before we of to cost is when So or us is to true. there is think is one a also true about product, able that opening it, through that attack we're service markets which number lower more ways reliable which growth, hadn't open structure, either a consistent a

see more happening. we So clearly opportunity

new new be already by intermodal property can in on of that turning can be done Another a done and done terminal and a ways, terminal to it cite way to into exists any number can transload, Minneapolis, it to do industry it is expand intermodal opportunity be it our around by taking Dallas by new reach that can done be it the it.

underway some is and observations examples to growth opportunities the make Kenny few a ask us kinds maybe give that achieving you're and of I'll you of All right of now.

Kenny Rocker

Yes.

so. think I So,

Chris, of like a car performance First service really have it start and all, in things velocity. improving you product. does service the job of his team with shows know, it fabulous and really up Eric the done

then won that have excited that able want to new we're right been to the there carload to parcel. as may lower in reliable have side for us, market that's going up we're the positions more there in on access and provide business, we've not that So finally, take lines areas to And we is able on velocity that look look we're but to The domestic like about getting we, or us, structure at intermodal with value auto opportunities has you compete for for opened you commodities lower cost we're been the our sales containers to example, network. match and about network large some the able that the commodities true more a offering that you consistent, win where grain either on Lance, we've at about becomes with past, truck as encouraging really weren't up able same is bulk, able that as been in product back talk compete talked the product be like back to customers Pocatello, in really then to way. fertilizers, and to

Lance Fritz

big near-term technology something of yet, else there's base technology that that Yes, platform. wins. and our Kenny, One two drivers Chris, haven't is we mentioned our

You that a help ESG carbon care looking all number There got it's course the us about much, of are number us them our and important customers our you We've a really already and story to our their technology something to manufacturers is APIs micro really of that's do. are active is base. easy data reduce win that as APIs business that helping part of number to we the becoming then instance is more our the for us vehicle X rewrote are of customer Those means approaching, with dozen services over know ERP a is with of with the years customers. architecture. What electric for and conversation platform footprint winning streams know winning. a last much

moving opportunity. our perspective, So of a is parts there from and Chris lot lot of there's a there

Chris Wetherbee

Yes.

great this you. the Thank great. Appreciate time. That Okay, color.

Lance Fritz

Thank you.

Operator

Ravi with Shanker Please is with Morgan from Stanley. your line Our the next proceed of question. question

Ravi Shanker

half months and week, next weather outlook not from you can of is what to everyone. one than guidance that to here the guide. XQ, I ago, Lance, expect topics terms a circumstance guys steal us also can give can to you consider at but give in question, in of the had given understandable on second thunder much stronger raising your at did broad you you one first Day going all of I a but Analyst that's tough bit X address? a macro may completely you we the the the with sense mean obviously Thanks

Lance Fritz

our great, evaluate do you. guidance periodically. so we thank Yes Ravi,

improvement a fairway, middle ourselves range, a is prudent as forward, set of is and Of performer. every when delivered a the kind very, you're level change last at us the in an course, we would strong already that were is basis expectations XXX we the particularly quarter not up of jump year look performance we're very we XX.X mark opportunity moving which what we've of year-over-year, good at meaningful, think of industrial points being at is that

get also quarter very look So remind just there is comps half to you I the on no what some of second more just high are would on news like, kind there the is second optimism that because the Xth is you strength going we're to and the guidance. when acceleration intermodal, then so easy, but domestic grain. real to we're quarter, now the the starting of starting particularly the Xrd world lap real in some lap in also then and parcel

in that exactly expect out. guidance what to has yet to plays And stands. terms seen be for then it Investor that how Day But So our next our even context, of in week.

to...we're what we from what lay hear we us us and hear what talked to firms. going you're granular there going customers continues in improve how our is how you're going that out going lay expect So to just out serve and to there, to about we're to real

can what year. you So work you're account you you're of what the will to that name looks we and to you to, can, going us customers, can streams We'll talk out about expect, like winning to specific opportunity hear talk good us and hold for. about very how expect to we'll guidance overall lay nice of together going course how streams X all of work our of a grow, really to for get sense we're a of that And context in the going we're comes of to going about going reaffirm doing lay down then next to start that with then stakeholders with we're a years. couple context talk and And to markers reality. kind this

ESG communities about about our with talk railroad. talk critically serve. we'll going I a So our employees, we that we on how Because part that's of run what's think We'll the this story. important

value license operate all that need about them how much XXXX our communities to it us healthy. hear social and relationship and a with we how to they them we and We have we keep and serve talk

going in Pacific team leadership going all to see you're of you're the story that of tell going see hours you're to X hear and So that Union to collectively. it

Ravi Shanker

looking forward Thank to you. that. Excellent,

Operator

you. Thank

line the from with with is your Allison Suisse. question next of Credit Our question. Landry Please proceed

Allison Landry

Thanks. morning. Good

trip topic the wanted to to to that back growth, know, a say meeting compliance, of step to service of the Eric, to and but both back go manifest low Intermodal and and not you earlier, specifically compliance the plan I weather, 'XXs. back trip took mid plan manifest get Just sort you to the the from mentioned think

chip I really to us sort competitive convert more when start longer to and somewhere be if accrue or and the of you term you think need could the story? just some then really mean, 'XXs need from to you the or to opportunity help that's in you with range that So about be in away if volume through, could 'XXs and of do there at XXXX start to to merchandize highway be the get truck to you beyond 'XX could where

Lance Fritz

Allison. I appreciate your question,

focused So with my finds both will be railroad. this as them the of plan compliance going auto the the quarter is but in think and recovering as progress had into focused product intentionally responding intermodal then also what we to morning, the we and the and bring a forms. we've forward he Kenny discussion continue to to and partner about very those today operations as on see short-term right completely side. that opportunities work in to trip we're continue take will opportunities manifest that service team the XXXX really certain going and on so some We're we into to that your and now guidance that together both open remain to able opportunities, on the to growth point to to different on demand I going the lot we on far is growth To beyond. broadly, the idea second grow

then ensure remain to with close to Kenny grow dedication to have business. very but broadly, opportunities continue growing certain service to in So a also that we complete TPC that we're the providing

Kenny Rocker

which And is at of better, I be tells in us where costs into more that high of And threshold 'XXs Eric, more truck-competitive. be let more then reliable of the do was 'XXs and parked least near-term plan there manifest to at kind is on than me Allison compliance better it's right the our valued. minus but a the to side thresholds is the think needs trip part experience or intermodal now. jump we side, your would question and be should say what kind plus about and XX-ish on

Allison Landry

'XXs we Okay, [indiscernible] just threshold? you do is the low the clarify about what mark? like that think to manifest the point mid-XX We cost the mid-XXs at mentioned or should at just reach the

Lance Fritz

hard Allison, and not a fast Look it's rule.

when intermodal great 'XXs they'll for away for really probably not second numbers did and into say like valued and would run those creeping you volume starts and service there's is If in railroad up the than an in pretty mid-XXs, manifest jacked intermodal, appetite and it 'XXs is backwards in up good. you get can pay it. a just the if it the for the it's 'XXs mid more same quarter look goes mid I efficiently in somewhere smoothly

Kenny Rocker

customer, lanes at or predictably going know that me that here XX is that be XX whatever that we to could it's let I it number they what talk predictably is. is jump can can to we them can XX critical about reliability to real still that that want in say the what just the truck or and or going take XX quick, of get part after to Yes, to

Allison Landry

Okay, Thank I you, guys. understand.

Operator

Morgan. Next question. coming the Ossenbeck Brian question is from your JP with with proceed of line Please

Brian Ossenbeck

taking for Eric. Hey, Thanks One for the good morning. question.

key just the metrics If an you on give update April performance, could us the here on through KPIs.

for the about about update gets negotiations. we're on, how in I the just ground And like? realize still squeeze independent bigger the last I of you moving the we're challenges detailed pretty the I mentioning hear picture on I seeing that and view the if from crew If putting next negotiated. that offer workforce when you and the are of and of can conductor on of think that do train more And it's how just then some productivity all-time guess mix despite can track. some strong is you're a quarter talking still might things Lance, what an size the labor give that'll you still ones the few a years. us perspective record growth on be potentially early, then look helpful more context but in the that improve in growth can one that to

be that So how to progressing. if helpful you. would what just means you bring Thank us speed can that's on...on well. That and as up

Eric Gehringer

We just started.

Sounds good.

XXX; you X car left-hand So car terminal just so if see we side Slide our start freight as velocity baseline, the we dwell. X showing look at can XXX with freight on last day,

XX.X. So in XX.X for the days, quarter X last

can back So very were we recovered of out than weather of pace and event, that we're the strong system, before. have on the indications system that are get we recovering the much

that can So we do strong confidence that.

Brian Ossenbeck

I about prudent. labor asked also the

Eric Gehringer

about number? we're that grow on, that, XX% about do on furloughed, that X side, to that, expect of how there currently you think the is. the productivity Is doing getting Absolutely XX% so Yes, the you retention focused think we opportunities we you're on labor really to ways. continue there out When to more are you're sitting are sure at you rate that. that people make

retain to been So we're growth the time, of still to had very XXXX. able our the furloughed we to at need when for able count side our on total be and same TE&Y people effective bring

So there is to time. pool upon, concerns a at strong there no this so draw

Lance Fritz

round. The move, been the flow of If one individuals work more match their then of half is put over men Brian, crew that ground, capital to We size to of think work your are question And pursuing labor that we the productivity that in schedules can underway they the positives negotiation are pursuing successful, being of shift lifestyle foremost are train for to is that XXX. we're which is changes we right one course this a create of but which commentary be of railroads put that's shift capital and the national scheduled locomotive, year. the are it's that answer the into locomotive of the other we trains, lot got certain I'll is work able and that are far real unpredictable, round it's benefit. off engine would It's which in labor build middle in for we'll XX/X, the that train. first of improvement servicing, than real can it, negotiated. circumstance, railroad of on work course ground from it a most a one got a a benefits that's in to and productivity There difficult the on a, if be is on somebody parts get

Brian Ossenbeck

Eric. And it. you, I appreciate Thank

Operator

from your of line is America. Ken The next of question Hoexter Bank question. with Please the proceed with

Ken Hoexter

morning. Good Great.

Just year a said follow-up year. first questions. quarter for part on a couple or the target you XX% the of last In our carload first

target, being of mean, but Jan any thoughts XXX target. to on we end your year-end? you by can top are by maybe XX%. IP Do employee basis see Thanks. there points in last What staying or share that, losses can as the Just conservative in to to are that your mention up set that changes throw. Moving you since yourself if still the to down need consider thoughts employees and on I follow you question, meet then that? you

Lance Fritz

the about But thinking could, take keep best I short I is X%, XX% Let it. late talked now it's year. thinking if the conservative before we'll on me mean the tuned our up was We've headwinds our or the yes, best conservative our question not no, answer best potential in thinking.

Jennifer Hamann

things a happened just what We we laid tougher had when than We're and also worse quarter with wants anticipated for in a out bit played Allison starting I than first a And guidance weather. that with we actually large to how would out you. our off add commentary. little

employees. locations little we keep to shy we Ken of do and downs the little think headcount just be end see terms some small may out to ups So, of if XX,XXX we to bit some range, we that that hiring question, but have bit. Today, at it see in high to that of base you We able crew actually where call don't even adequate relative a kind playing in there. of those, a state your may steady should of it how have

You efficient plan XXXX heard the being Eric to furloughs, with refer crew base. on very we but the

the be gave, And that keep so with little X%. the we that flat of think we that seasonal should able even range fluctuation. We up high-end some to to pretty

Ken Hoexter

it. Thanks. Appreciate

Lance Fritz

Thanks.

Operator

proceed question with Oglenski Barclays. Next coming is Please from the Brandon with question. your of line

Brandon Oglenski

taking good everyone thanks for and Hey, morning my question.

I with really or not or it a where Eric feels see, lag. back just want you industry So get we come I on maybe you Lance is Jennifer guess, can, it, Ken's question plan want historically, like to Union repetitive scene there, follow-up but trip Pacific where when to just compliance metrics volumes service rail

more So resource I guess this going always historically, light base answer assets the think because no. more know locomotives what of can to our I that throw was of be employees different such that you can is you do time you think

Lance Fritz

fair QX to we've our if ever in it for a crater period And subsequently case history volumes point last in that's different in in demonstrated track February, as PSR now, late Yes, return, to is ever early is record I April recovery recall dramatically as Great. into we year a fast Brandon. from, recorded dropped What's in then where volumes a seen. from seen last call our question, as we've as when March recovered and the QX point. us QX. very world of don't year, Case question great Perfect. a

seven to end at our improve seven service, now of metrics that's the day the XXX,XXX continued a from on when to a days year. go you proof XXX,XXX right We statement

resources you're resources at the of that pretty empty network work network. point, clearly, a to Now do but loading into into still loading having you're the

the a today's would I locomotive we If network, that volume be think handle take and got franchise would that. demonstrated, able be to color. and make crews, the do a XXX,XXX now. I'm to starts, pretty physical the to on is know should layer Eric, we've be and that readily we've in the number. how the right that we to job necessary seven can day, do train efficiently up to same from that true going a go to a

Eric Gehringer

greatest we able you given of of very and thinking have running to day. the network all this XXX-ish train as But about is any one of continued one tool that, years best And would reported ago, our to fluid feet. efforts product when trains length up X.X being we a that around is the tool you're of have we about deliver think the as, as XXX had we're service XX%, on do morning,

continuing is to of leverage a degradation XXX opportunities the Now, terminals link XX% that's drive plan in compliance, potential events, our variability XXX and we up for we're and which day, train mid driver XX trip number. key that less both primary any so on to that number how operate at consistently to top

Brandon Oglenski

you. Thank

Operator

next line question Jon of with the Chappell Our your with Please question. proceed from Evercore is ISI.

Jon Chappell

you break ports? Thank are when Coast look, in going the you The talk of on there, congestion opportunities, the take on a the you reading, solution, chain, that's There's a conversations thought port got court And on I with for a the you the of from have the supply the lot you a competitive lot One, so it thing the that's but, headlines you. look know Kenny, favorable also, here me at Coast Eric that going and as West to in, me look of cost about of pitched down and problem, to the advantage a then back headlines little as in at, the to one been but about things. a you to increased to there's at is variable there. let then rails clearing look this Good progression truck seem other seem port capacity. the morning. you speak backlog, pretty at a to bit in lot be be the relates warehousing recently, dynamic some part capacity the that bus, noted that especially of what's the taking perspective? capacity here ocean West you few the a outlook as we of favorable can the flattened, carrier just have demand another your not actually beyond tight congestion issues still getting the share weather, off highway, thrown

are on labor lot tightness so those warehouses to the containers there of out the physically have challenges side, So in the a the aren't take out they container, there floor. There trucking are to we are some look full, just seen unable there. still terminal, on left if you the there some the at long-haul, then, and certainly capacity at go issues even trade cases,

wanted So, what talk to doing Eric, from can operational is we're if we're focused an we control. on about here standpoint. you what And what

Eric Gehringer

because Jon, is a Union component Kenny question supply chain And I appreciate that the entire critical mentioning. Pacific Sure. of was the

July in look time we LA what's specifically that from back when and have the to ensure last being ICTF looking of So had capacity. able total to that the feet able footage always against to October at XX,XXX at from up if how, we're of resources we go trains year, we're out that Basin of so we the we depart

on support in took again increase. Now we middle of LA as in starts XX% intentional Basin time actually volume also of top that to were year, the this April growth. sell driving then the increase train and continue XX,XXX we in of that We XX,XXX November and to of to ahead X that now that that's increase and a of out our to

out can So the they on Union that everything entire Basin which Pacific process, as you efficiently, doing fluidity get overall hope Empire, see, the Inland to LA the with terminals, inland that's volume see the chain. in that of I into the bring supply and you helps it component and

Kenny Rocker

out season. as close the tight intermodal some we seeing side on fully the going about domestic move side. wins Jon. marketplace. through on throughout by as year, we're past though, feel the we're we're just market It going about the the international very good is feel We a optimistic the We of this So, that here, incremental wins encouraged

Jon Chappell

Thanks, Okay. Eric. Kenny. Thank you,

Operator

Please proceed your with next question. from comes of the with UBS. your question Tom Wadewitz line There

Tom Wadewitz

I to wanted Yes, bit some question Lance a said. to the back consolidation the of good morning. go little

morning CN I there large is yourself you you of what have essentially get you I of consolidation, a mean, consolidation. protect comments essentially past, rail in kind business So that Chicago or think that at protect it and and, about potentially your been obviously, you this in you say. Yes. terms of yourself. it amount do of that are cautious don't traffic from do should risk? at gateway? how Would the be Laredo think few overstating happen, against think just We to then kind the that care CP need do how you about to have gateway, bridge and some you do would at is Laredo to gateway.

Lance Fritz

And on and thanks Tom, good questions. clear morning been We've consolidation. the for very

got question, the it there downstream weather exactly protect disadvantaged and We'll course Laredo that for for competition contemplate to by of and part the achieve note If mentioned of think long-term together doesn't the part for or any that process to thought remedies constantly were it own primary that outcomes STB how creation, are out. it committed The all in and our industry. for primary of all concern. and regulations ensure the when the put have be get the CPU to participant it always is make Class long of not UP You the in mergers active and us KCS destroy either current to you enhances the term CN, to point. we the is is KCSM X the whatever is ensure that will comes navigate always That's better a option to of reviewing required we'd your we authority STB you've customers we we that we've and in which undertake things. to right. opportunity do evaluating X are Related to the or how gateway do big full they that terms And sense that that process is to value has value merger KCS that how if lots enterprise in impacts it. has the been represent, gateway they see competitive both boil that's second to have do an this sticking that

treated the the United a we're in conjunction with then and the to fairly and franchise our is rail of the X/X industry. what best disadvantaged. gateway it points in be to that's equitably that with it's the the border fairly because that treated make our we against currently We that and damn at KCSM, that have we're and from we're all would to States Mexico we'd And have to make serve the if in do they commercially an sure have in why shame would sure franchise good, operationally, equitably opportunity and excellence inferior committed that's would merger STB by replaced is about the crying has cross represent to all traffic evaluating something and we be

the So we'll be and crystal clear of the front about STB in that process. in

Tom Wadewitz

at to franchise you Laredo? are But protect the think we Okay. there

Lance Fritz

FTD. that would it would positions There XXX%. and flow be through Yes, concessions remedies they are,

Tom Wadewitz

you, Great. the Thank Lance. perspective. Thanks for

Operator

the is Our question. from line with Please your Radbourne Securities. next with proceed question Cherilyn TD of

Cherilyn Radbourne

very Thanks and much good morning.

ask challenges Just mutual you question you've regarding could the West slightly wanted do you different interest done going protect forward. on a in expect program on was what more I just that in and to Coast. comment the what service customers program capacity hoping to the to for commitment see

modes. the capacity across given all challenges Just

Lance Fritz

doing to see the as I responsiveness and announced and as program, tightened. are we taken lot Cherilyn. we that see supply are that with mean Thanks, chain protect in market the those changes we have customers a Yes. clearly, we quicker that the action the

what they're individual and having about they our their time there supply the as doing to as and can dwell out of what into with we're enough utilize about just with our talking sure customers beyond in take their to chain will it We efficiently assets. make Street BCOs communication with and can they constant do help it relates to, actions to so that them customer, were surcharge and going those that customers and European relates and that talk

Cherilyn Radbourne

see interest that in expect program going forward? more And do you to

Lance Fritz

and We waiver that entrants any expect would seen have and be we there of not be the to strong.

Cherilyn Radbourne

That's you. Thank from me. all

Operator

Please RBC with proceed next question Spracklin your the Gentleman, the line of Markets. is Walter question. coming with Capital from

Walter Spracklin

much. very morning, everyone. thanks Good Yes,

do question control? to In just partners much your make other remains that, So everything And words, economic above and is and protect to see fluid what risk is just beyond very as potentially that outside of following on do that currently significant what's question with regards activity, expected, here sure in supply to a speak can of you congestion your how if and that? of increase a ability to follow-on much there how a on yields. to we your chain services within

opportunities. mentioned I yields potential yields everything with negative the that year going expecting that the Are with be and I'm on still you you think be negative and pricing year? to to were curious just for for demand this going

Lance Fritz

Let both. I'll the don't And about we've how anything on avoid we yields think congestion I over first comment turn it. me on year, said negative and then, in Eric about do it to specifics to start and Jennifer. probably Kenny

Jennifer Hamann

is we mix to business be the said Now negative. expected

Lance Fritz

Right.

Jennifer Hamann

yield. overall But not so

going But of quarter to when grain a there's the quarter numerous be expect Obviously, of is bit second So the mix better of the think Xth little to pressure impact. probably about look quarter here There's, with some Xrd components in which you terms and pressured pricing. in in the we going is do yields. there come.

then where last fuel pretty year-over-year about we've negative good surcharges. a got quarter relative and the is very prices pricing comparison So, and surcharges. This fuel to

better as look should that well. so year the over of And the balance

Lance Fritz

for towards sure transparency but Basin our the into and or in the what even went supply continues sure PNW Yes, what's make LA And we stronger economic visibility an congestion Kenny translating has with that happening, congestion? and right and Coast to in us to to strengthen, define, and and that's bit at going is Prince perspective, I us little that's current both the and activity part yields, got of and about service supply hit full about making East or terms an and transparency viewpoint ports, resources visibility the Walter of talking price sure that the my economic staying short be Rupert the I'm us the periodically support into need Erin the and up yes to engagement so make of said ahead not talk, to active to very, to to can that also avoiding we about what entire we Kenny and chain competitive if And having product. make we've on the Coast in and to sure demand, need excellent how Walter, Coast, against a talked very team whether answer just entire the sorry. it And we the it's specifically visibility West have and a we are stay we to do are the and metrics I price, where through are do for the front. the in making chain activity world in fluid about supply KPIs try ports Coast us surprises the the Eric. stuff West competitive to without predominantly his that's sure Gulf about that carloads satisfying that or is it routinely working stay which from chain

Eric Gehringer

Yes, hand visibility. resources on the take to I'll the over on

think rate, about resource you're the you you're things, talking when locomotives. So what about about talking X base are

So obviously LA the respond plus we locomotives in we locomotives that out ready that Basin. have geographical actually like the XXXX growth pre-placed have that are more we to as we have areas reported but storage, been in also at importantly to

know we car on can to a So in responding that. very we be many from that, constraints how perspective, agile

to month allows Now same at wise the earlier, turn and trying agility hiring by no process then every and which as we mentioned, use evaluate the there to well you're XX% single Basin use as just we LA crude base Jennifer higher LA Wednesday. Monday, the you started to may moving train be drive even of still finally, the making on crew when ready increasing intermodal in mentioned on more Basin, velocity, for see higher, may as on decision already for cars call. that a provide faster some and Kenny I to cars you was demand, resources immediate that the it's the there concerns by We're talked answer decision sporadic be the then, and about that And count but the crews.

feel I side. comfortable on very the operating So

Kenny Rocker

We this just then Yes, are. that didn't on now we made incentivize equipment turn perspective, to get And stay the about charges to equipment. we've on Eric very add I'd to the equipment customer the with so changes or our it coordinated obviously customers it's taken what do got moving they to year, in we made. plan that that that. their with he and their forecasts adjustments what here some to We've talking from visibility to our regardless customers, our whether just our talked

And to talk there. the We the boy. the visibility with to there and about I efficiency the about in turn feel they our moving are there good do really fluid. sitting network in think so decisiveness well, keep We down times and coordination to get can customers network

Walter Spracklin

was add mix but the great, to negative you I Okay, Then I keep that to. I was would. year The of thank you'd what think indicated in just would that the first quarter, X.X% and you. Jennifer was like That's for full it it I was that appreciate. referring business negative you there clarify, kind sounds about where to it asking

Operator

Please Our of is coming Alger with question. Sachs. Jordan with the next your question from line proceed Goldman

Jordan Alliger

Yes.

I or the sufficient half. into it more to per territory second up get revenue instead, and the just, down at a be positive biofuel the of mentioned and think carload soon then quarters. of perhaps as to that couple size opportunity opportunity Just that on is yield road. second and I'll And of least curious now scope that the following then I'm Thanks. be now for move as quarter just you've

Jennifer Hamann

with the especially certainly should was which second stopped. Jennifer, is the impacted was second auto the year's pandemic virtually better greatly quarter obviously This production, quarter last look Jordan. with

it a better we rather positive second have quarter. headwind, Now a will still but to headwinds. of bit that's do the This little year, in some look turn we're expecting production it

that I the to we good are on think that the but particularly be going, mix, in things feel direction about the back really is dependent going half.

Kenny Rocker

are term, that see renewable with long today of encouraged Yes, and have where we had are even where with encouraged the with do and we feel so a working diesel a on more very the really biofuels, see by that number have dollars we lags. we end we've been of capital we are about but it's to that. real. customers that know to with growing talked by committed We've network and been land We've our we investment, customers good to interested year and

at seeing point. why you're on that's us biofuels, that that there So from optimism the

Jordan Alliger

Thank you.

Operator

your is question line with Stephens. proceed of coming Our next with question. Please from the Long Justin

Justin Long

tailwinds Thanks you above GDP some morning. that's that is that is growth the to answer the it's if mentioned. topic Do and for that conversion in happen lower think Lance, the the can is the in achievable of business intermodal; a this ARPU. a of something coming on I'm longer and lot opportunity something guessing mix is you following yes, truckload because negatively volume without growth up term good impacting of

Lance Fritz

great a it's question, Yes, Justin.

of embedded at the but So than there might we grow to measure answer served industrial because production. of instead, GDP we have GDP the services is, a can boatload elements markets, believe best our faster be short right in the is not maybe you'd look

to true. give I'd going caveat one be the that's you So is

commodities, better exception that We'll rate our to another able a that being maybe be true. those our table handful frac the grow expect one expectation, We of of of but being off the markets with to another, if and and you at be we sand drive perhaps being them, coal petroleum one take served than

Jennifer Hamann

we to that I the next to able the efficiency grow a we ongoing question. expect profitability the profitably. that service price in don't that our see in we provided hindrance through we to into we today, business but our able mean the through to, been improve And going We're dynamic to recognize just has have has be say marketplace. been that's that

how obviously baked that into all talk that's future, of So about on. kind and more we're at looking Therefore we'll the

Justin Long

Great. Appreciate the time.

Operator

the coming David from question. Vernon is of line question Bernstein. next with proceed of your The Please

David Vernon

Lance. Good morning to

there down in a stands in is corridor truck Laredo two like Texas area case market? the this saying now that you lot in as that to doing do of perhaps a is are opportunity. the down Mexico Traffic that at to that gateway huge the competing is that on you to these seems that growth, is into you there's how of things what it out conversion for of and because you some you from short One can the bids even in that of Highway convert or are Would so, being like opportunity if opportunity? opportunity that either merger? far catalyze and agree out converted truck-competitive because intermodal you potential Midwest, capitalize traffic carriers a up merger, not what of as think look and today actually getting kind of that's that a do about guys the

Lance Fritz

Thank you, David.

with of working that can get with converted is to we're lot traffic be try in to rail truck and there FXE KCSM the both that So a let's start potential to the done. the constantly

our the from to call we to do to it intermodal product. product We though overall intermodal it's continue Even that. successful Mexico expect have growing that domestic we been actually and in and

in more for pick move be to get and got to Mexico, be what staying let's just shortfall do the the comparison in because KCSM shovel interested to a do right, they the and at destination or might to if them might as relative we or Now but truck within work, we FXE we've of origination able that that's the can Mexico complex, an always It's in transload that the there a opportunity case, to continue some and is that. use today do border. little

the to potential work and that filed the and posture. that shovel plan has all it real got and required remedy pick have at our about evaluating it is game and SCB and start convert of what then game once convert be yes, big would done So to of us expense, our been advertising plenty to case, not be in plan, with synergies, be be which it's there a the market's we is maintains that to can going means the to how competitive in it we seen there's see

David Vernon

to why as Laredo routing look your you if that, the just Midwest. into always maybe then not up the. of a been That's quick the at follow-up And railroad the reserve, on

was over I'd traffic lot lease the a for the say think on imagine that's that the out routing. wondering have corridor. coming I of just routing rail customers I there.

role, the some different to would it and there routing mean because assess of So kind just route. what a there? diversion risk traffic us of determining that is of play move carload of kind that another way it's sort of help and the route, up I out the customers

Lance Fritz

might best A to for inferior combined it's a it's best the through construct the carriers an for customer, potential acquisition the go commercial is have not market. opportunity routing and not and it's, to the

David Vernon

[ph]. you. officer Thank Thanks,

Operator

you. Thank

Our final question is coming Seidl proceed from with with the line of question. Cowen. Jason Please your

Jason Seidl

side, Kenny Thanks, operator. mean taking mark. a I one Lance for you then, team, thank obviously the maybe for And and on that's question you automotive this

XXXX. but guys Clearly, volume like of up that that's forward. back once guys. look first what going have in and half You there ability to manufacturing backlog And second and year the depend and should that ships for the on running. to on back get up expect you up, the should is maybe the What going the into of the we side, half

Kenny Rocker

international talking not You're about automotive. intermodal

Jason Seidl

Automotive, yes.

Kenny Rocker

is If there. the demand

to rest Jason, that the demand of We for expect strong be the year.

peak season. into going So

demand the be there. So will overall

in wins Eric heard also some talk You've service us we've customers the there. the doing out intermodal talk we're and about the about her what of international side to

mean that also And the supply compete well to and are structure us when Street moves our that I and warehouse for I should to up as we So demand chain open the a time bit. with out with velocity volume. ability the that say that encouraged the move there little the more

Jason Seidl

the a quickly, - back. just question it's XXXX, the service. half So in year I mark. ask to in but then just going the back you're and come of then premium the it's Then

Kenny Rocker

the demand a not about on way confident That's am. international feel good to I side. the intermodal

Justin Long

Okay. the as time, I always. appreciate

Lance Fritz

Thank you, Jason.

Operator

now additional no this There comments. the Mr. time, Lance for you. questions to Thank Fritz will floor closing turn I at are

Lance Fritz

and for questions. Thank your Rob, all you, you thank

Day Virtual Just hope Investor our a you're wish attend we X looking at an Pacific forward PM be on Eastern health We're discussing all reminder, I good have take Time. X:XX us. to upcoming for we strategy care. you and going all to able Union with vision and to and May

Operator

This you. Thank conference. will conclude today's

lines at time. disconnect may your for this participation. you You your Thank

Union Pacific (UNP) 22 Apr 212021 Q1 Earnings call transcript