Let me know when we're good. All right. Fantastic. We're going to get going with our next session with Keith Creel, CEO of Canadian Pacific Kansas City. Thank you, Keith, for being here. You know, a year ago, last minute, we were—you had a—on the precipice of a strike and last minute change, so took last year off, but really happy to have you back. I got a lot of questions, but I'll give it to you for maybe for some opening thoughts, and we'll get into it.
Hey, thanks, Scott. Always good to be back. I wish I would have been able to come last year, but some of our labor uncertainty that we were dealing with in Canada, which, by the way, has been cleared up in a very positive way, kind of consumed my time. That being said, though, coming back, you know, we're two years into our merger. I think we've had another year of opportunity, no shortage of challenges to prove the worth of this network, to prove the uniqueness of this network that we've created. We've outpaced the industry in growth, both revenue, volume, and earnings. As we said we would, we've created competition that, quite frankly, this industry has not had to embrace, I'd say, for decades.
We have created a customer base that, based on our service, is rewarding us with new business and new markets, as well as market share, as well as share going from truck to rail. It is allowing us to create unique outcomes. We closed out the fourth quarter last year with a lot of momentum. Had a very good quarter. We came into the first quarter. I think we had an industry best first quarter performance, and that momentum has carried into the second quarter. April was strong, May even stronger. I think quarter to date, we have got it to a mid-single digit RTM path. Year to date, first half of the year, we are at 5% on an RTM basis year over year. Quarter to date, we are at 7%. I think I looked at it this morning, month to date, we are at 9.7%.
We're not looking at any cliffs. We're looking at a very strong basebook of business, that's unique to the industry that, again, in spite of all this macro uncertainty and all this tariff tribulations and things that have introduced risk to the marketplace, we're finding ways to win.
Awesome. I'm going to start. If you guys have questions, raise your hand. You know, I usually start every one of these with, let's start on near-term volumes and what's doing better, what's doing worse. We're going to get to that shortly. Sounds like volumes are doing well. I want to start maybe just very high level. I had two questions I sort of just wanted to, you know, start with. First one, you know, if I look at your stock, right, it's been sort of range bound since 2021. All the rails have sort of been range bound. You know, there was such a long period of outperformance for rails. The question that I think about and I get a lot is, what has changed?
I guess, is this just an unusually long and challenging cyclical environment, or is there a bigger change that's happened in the industry? I guess, you know, maybe a minute looking back and then just sort of going forward, right, what's the catalyst? You can answer it as CP, you can answer it for the rails, right? What's the catalyst to get more sustained earnings growth, stock outperformance again? Do you think we're at that, like, inflection point now?
Let me, I guess, think about this for a minute. If you think about the recent past, and I'll say three to five years, unlike any other three- to five-year time frame, I think our industry overall, and not just our industry, this economy, has had more hundred-year storms than we've had in any time before. You think about the pandemic, what that did to demand, what that's done to the economies, what it's done to supply chains, the aftermath of the pandemic, the challenges that the rail industry specifically went through, growing pains that it went through as it tried to implement at a wholesale level across all, just about all rail networks, a PSR operating model. Some did well, some didn't do so well.
Now you think about all the administration change and the tribulations that we've been dealing with since this uncertainty when it comes to tariffs has been introduced. I think it's a unique set of, again, hundred-year storms that have occurred in a very condensed time frame that's left us with a very anemic economy. I mean, GDP growth, if you look at those same five years, not very exciting. 1%, 2%. All that being said, I think now with this administration, I think we are uniquely set up for stability, as crazy as that sounds, because now we have a new administration in Mexico. We have a new administration in the United States that's focused on growth in the United States, bringing jobs back to the United States, prosperity in the United States, rebalancing trade, not just in Canada, Mexico, but with the world.
and then you have a new administration as well in Canada. I think from a stability standpoint, with leadership in place, focused on the U.S., President Trump, how do we bring prosperity and growth to the United States? How do we rebalance trade? I think that uniquely puts us in a good place in Canada. Canada, you suggest they're, you know, they're at risk because they've been so tied to the United States. I would not say that's not, that's not wrong in a lot of ways if they don't respond. I think now you've got a government in Canada and a country in Canada where they want to create more independence than they ever have, less dependence upon the United States, which means for all their product-rich environment, they've got to find new markets.
Again, when you think about where those new markets and how are they accessed, that plays into our concept, that plays into our network, that puts us in a place of strength. If you get to Mexico, the same situation. You think about why has Mexico grown as much as it's grown? It's got a plentiful workforce. By land, you don't have the complexity of the steamship lines. You don't have to cross the water. Supply chains are de-risked by all the nearshoring that's occurred. Again, I think we're set up as we have an industry that's evolved. We have an industry that is more focused on being truck-like, reliable, so that we can be dependent upon to entrust your supply chain to. I think that puts us in a place where the service offering is going to be better.
I think with leadership in all three nations, trying to create growth and prosperity, I think the economy overall is on the precipice of once we get through this settlement of all these tariff tribulations of actually experiencing growth again. I think that changes the next five years versus the last five years.
Okay. And then one other question, just want to sort of knock out, and then we'll get to some of the other stuff. We had all the other rails yesterday. We had STB yesterday. For whatever reason, there is definitely a little bit more chatter around M&A in this industry. You talk about truck-like service and the idea of TRANSCONtinental mergers, you know, and all that. I guess the question I'd ask is, do you think CP, KCS was the final merger? Are there arguments why TRANSCONtinental mergers make sense, why it doesn't make sense? Sort of open-ended. I'll let you take it, you know, where you want.
I would say, there's always been an argument why it could make sense, but the arguments would have to be able to ignore the regulatory risk that is undeniably there. I would say this, I'm the only CEO in the industry that's navigated that regulatory risk. The standards that we had to meet to get our deal approved fell in comparison to the standards that are untested in the new merger rules. To create a network that not only protects competition, but enhances competition, that protects service and enhances service, there is such a, not a hill of regulatory risk to climb. There are mountains of regulatory risk. Quite frankly, I don't think it's necessary. I don't think it's needed. I don't think it's realistic.
I think the risk it introduces to realize some of the gains that you might think it would produce, the math's just not there for me. I think it's nice to talk about. I don't think it's very probable. I don't think it's possible. I don't think it's going to happen. I don't think it's necessary. I think there's an ability with each of these networks to focus on what you can control and to connect with customers and to be more entrepreneurial, to create solutions for customers that allow business to be put on the rail and taken off the highways. It's just up to the individual teams to be able to do it and to be motivated to do it.
Just one very quick follow-up, and maybe I'm being too focused on one thing with, you could seemingly could argue that your, the CPKC merger has been pro-competitive when you think about some of the competing services like Falcon with CN and UP. Is that not the, and there's been, unlike prior mergers, no service issues at all? Could you argue that we have sort of enhanced service and enhanced competition with this merger? Is that the template for others, or is it totally different when we're talking TRANSCON?
I think that would be their only hope is using us as an example of what is possible. The reality is the facts are not the same. Our merger was end-to-end. There was no overlap. 100% of the customers got more opportunities. There is not one customer that received less opportunities. I think those facts simply do not exist with any other proposed merger that might be out there.
I'm having flashbacks to your speech about the eight or nine facts.
The undeniable facts.
The undeniable facts, okay.
I'm having flashbacks about some certain commentator that told me I was off the rails, but.
Let's now turn a little bit back near-term and then lots, lots to discuss. So, RTM's tracking up 6% or whatever quarter to date. I think May, you said, is tracking up closer to 10%. How is this sort of relative to plan and, you know, what's doing better than you thought? What's doing worse? I guess grain and coal both look really strong. Potash and fertilizers may be a little weaker, but, just give us the lay of the land from a volume standpoint.
Yeah. As far as our expectations, we said all year long that we thought mid-single digit RTM growth is what was possible. I would say that, in spite of all the macro challenges, we're overachieving in a lot of spaces. The spaces specifically, you know, the bulk business itself overall, we're up double digits in Canadian grain movements. We're up double digits in U.S. grain movements. Again, some of that is what we naturally would get for the market. Some of it is new business. Baked into that, we've got grain that's originating in Canada that's going to Mexico. We just made a move I talked about last month, a 3,000 mi length of haul for a unit train. That's pretty compelling. I'd love to do it every day, and I think we'll do more of it.
That's coming from Saskatchewan going down deep into Mexico, that quite frankly was never possible before. That's part of those numbers. When you get into coal, you've got Elk Valley coal, not Teck coal anymore. Elk Valley, change of ownership, you know, whereas Teck would produce 25 million metric tons, Elk Valley is not going to be happy if they do not produce 28 million metric tons. So agrees that, again, that's supportive to our book of business. The other thing that's really exceeding expectations, even my own, is this whole Gemini Alliance, International Intermodal. The other railroads, the Western roads, the other Canadian railroad, they're talking about the cliff. We do not have a cliff. We've got a tremendous amount of demand that's coming to discharge in the Canadian ports. It's interim specifically. That is the alliance of Gemini and Maersk, and they're having a resounding success.
You know, they put an alliance together based on what I would call PSR steamship service that matches up with the PSR railroad service that allows unique industry service that allows steamships to run on time. They get to the port on time. It allows me to plan my trains on time. And so far, they've been in service now for two months. They're 100% on time, two callings a week into [Syn Term,] and they've got demand. They've got demand for their product. That particular product, our International Intermodal year over year is up 40%. That's a lot, and that's certainly exceeding our expectations. The other really exciting avenue of growth for us is our domestic product. And it's most specifically in Canada. The last two years, we've been kind of a headwind. So you've had an oversupply of trucks, less demand.
The Canadian retailers are stronger now, so that's stabilized. We've got incremental growth in Canada, but the place we're really growing is that 180-181, which is domestic service from Chicago into Mexican markets. That's truck-like competitive. It's four-day service. It's a day faster than our rail competitors, and we've seen it continue to grow. It's up quarter to quarter. First quarter is up 25%-26% versus last year. We're up 6% versus last quarter. That train when we started two years ago, when we introduced it, was, you know, 3,000 feet a day. Now it's 7,000-8,000 feet a day. And it continues to grow. We're now layering auto parts on top of it. As I look forward, the other piece that hasn't come online, that's coming online in July, we talked about Americold.
Americold is a brand new product in the rail space where we're taking refrigerated, frozen meats and vegetable or meats that are coming out of the U.S. going to Mexico and vegetables coming out of Mexico into the United States and into Canada. That facility that's built in Kansas City is going to open up in July. It's literally at a point of being sold out. We've got the facility that we've built. It's in [Lázaro Cárdenas], Victoria, Mexico. It's shipping too. It just got commissioned and approved by the Mexican government. It's going to be ready to start making shipments the first week of July. That is going to gain momentum. That same company, Americold, they break ground in Saint John next week on the facility that's located in the terminal that we serve in Saint John.
Again, these bookends are being created that's allowing modal shifts, truck to rail, and allowing markets to be created that are unique and contingent upon our network that's being created with this merger. It quite frankly is allowing us to drive, I think, outsized gains versus the industry and continue to strengthen our book of business. Automotive, the same. Automotive took a pause. Our entire Virtual Loop concept that we're selling, it's regained its rhythm again. We're up 24% year over year in the automotive space. Again, put all these markets together. There are a few weaknesses. Lumber, I think I've seen a little bit of weakness in, a little bit on metals. Again, those are small pieces of our book of business and we're overachieving in other areas of, you know, it's kind of, it's kind of immune to you. You don't see it.
It's all baked in the numbers, but the reality is the puts are certainly overtaking the takes.
We've heard so much about Gemini. Can you size how big it is today? How big is it going to become?
You know what I would say, what it can become, $100 million of growth, $150 million of growth, where it goes all depends on how successful they are. The other piece that we have to look at is capacity. I'm not going to allow our railroad to get oversubscribed. They're going to grow with that service offering. We get to a point, you're going to get to a point eventually. I don't know if it's two, three, four years. Again, it depends on how successful they are. We could get to a place where we would want to improve the profitability of the book of business, repatriate the book of business, perhaps, you know, allocate more resource and capacity to this Gemini Alliance than we might to existing businesses today. That's part of what we had to do to prepare for that, for Alliance.
We don't talk about it a lot, but there was one particular ocean ship customer we did not renew a contract with in this year in anticipation for the success that we're having with Gemini. We'll continue to approach it how big it gets. We're not going to let it get out of control. We're not going to let it adverse affect our network. We're going to grow responsibly with the customer, but there is definitely upside potential to it.
Can you, similar question, like in the terms of like the size of like how big the Americold could be?
Not that scale. I don't, I don't believe. You know, I'd be guessing if I threw a number out there. It's going to be tens of millions, not hundreds of millions.
The strength right now we're seeing, you said U.S. and Canadian grain both up double digits. Is that sustainable or as we start to lap crops and harvest, does that naturally just slow a little bit?
Unless we have a drought, I see it as a position of strength for us. Yeah, we'll continue because we're going to benefit uniquely from any product that we're moving from Canada to Mexico that hasn't been in our rearview mirror. It's all going to be growth going forward.
Okay. And so just a couple of things as I, as I think about the guidance you guys have laid out. We're tracking above mid-single digit to start, you know, through May. Comps get, I think, even easier back half of the year because we're going to have some of the, is there a reason to think we should be doing better than mid-single digit now?
I guess we'll see what happens with the economy. I would say this, we modestly adjusted our guidance. We thought it was the responsible thing to do. I said before all this uncertainty created, I saw a chance to be at the top end of our guidance. What I see today over the last month, things that have cleared up, currencies moving more favorable, U.S. dollars getting stronger as some of this tariff uncertainty clears up. I don't think we have the likelihood of a recession the way perhaps we might have had a month ago. The basic fundamentals are there that we'll get to a place where I think it's more probable than less probable that we'll overachieve our guidance. I think it means more RTMs and I think it certainly meets or exceeding the top end of our EPS guidance.
You're just, you're talking about the new 10-14 range.
That's correct. Yeah.
Okay. What about the long-term guidance that you gave us back in 2023 was basically to double earnings by 2028, get to give or take $8 earnings run rate. Is that still, do we still have line of sight to that? I know that's still a few years away.
That's still the plan. Certainly, I think we did 11% last year. There's no reason we did 14% the first quarter. I think this year, again, within that range of guidance, we're in a position to be able to meet or exceed that again next year as long as, again, we don't have some kind of macroeconomic shock. If we get some growth back in the economy, we've been doing this with headwinds. If we get a little wind behind our back, then that bodes the case for overachieving, to be even more compelling.
Okay. Similar, just, you know, going through again, some of the longer-term guidance. You talked about $1 billion of revenue synergies by 2026, $1.5 billion by 2028. What have we realized to date on that, to those targets?
We exited, on the revenue side last year right at the $850 million run rate. We said we're going to add another $300 million. We'll do that this year. I see line of sight to that clearly. I think we'll exceed that initial revenue guidance before this year is over.
A year early and we'll exceed it. Okay.
Yeah. Certainly the base case is there for us to overachieve.
Are we pulling forward? The ultimate pie, is the prize still the $1.5 billion, or is now we're finding even more than we thought, and it's even, you know, the totality of this is.
Again, as long as the economy is supportive and not, you know, it does not shock us. I see there is a case that certainly we are finding out more. You learn as you grow. We know more than we did. There are things that are occurring. I never could have predicted this whole crisis. Think about this with, with the tariffs. You know, people see risk, we see opportunity. We see a motivated team that goes out. Do not make excuses, make solutions. You have got a government now in Canada. You have got markets in Canada that are being connected to Mexico as part of that diversification play that just the ECP piece, that is $100 million in new revenue that was never in our thesis. So how successful can we be with that?
Those are those things, those opportunities as you build this thing out, develop, that you just didn't have a line of sight to.
It felt like one of the bigger opportunities was on the auto side with just some contracts, you know, taking stuff from Mexico up to the U.S. Where are we in the timeline of getting those contracts?
The thesis on automotive, we thought it was going to be on the tail end and it was all contingent upon contracts that are opening up that we could compete for that do not open up until next year. There are big contracts on the rail side. There are also some sea contracts that can open up in 2026 and 2027. That being said, those markers are still out there. We still have to compete in that space. What has happened with the crisis that occurred in the automotive space? We have made our progress. We have made our success. We are already over $200 million of annual revenue without even getting to those contracts yet. Again, not knowing what you do not know, not being able to predict a crisis.
We've been able to create with the facility we built in Wylie, Texas, with this auto supply chain, we've taken that crisis and turned it into an opportunity where the OEMs see the value of our closed loop system, being able to get guaranteed rail car supply, a guaranteed number of cars on a weekly basis to take or pay. If we don't produce, we pay. If they don't load, they pay. It's created an ecosystem that has created the groundwork that I think gives us a chance to better succeed when those contracts open up. We've pulled opportunities forward, but the size and the price still remains there. The original thesis is still out there for the taking. I still think there's a significant amount of business to be won on the automotive side.
I want to shift to pricing a little bit and again, if there are some questions, raise your hand. I think you and Nadeem have probably been like the most optimistic or, or transparent about, hey, we had a couple of years of elevated inflation. There is a pricing catch-up. Is that playing out? Right. Are we, you know, firmly back in that inflation plus pricing camp? and then sort of what is the runway to go on this inflation catch-up, inflation plus price?
Yeah. We said we had planned the three to four and we're definitely north of that. Part of it was the inflation catch-up. I think we're kind of getting beyond that in this year. Now it's all about based on the service and it's based on the value proposition for the customer. If the market, if the other roads are going to be taking 3%, what we're selling is not the same service. We're selling truck lock reliable. We're selling stint link to falls. We're selling asset turns. We're selling value propositions that, frankly, in a lot of ways, the other railroads can't sell. That creates value for the customer. We in exchange expect more price for it. That's the thesis that's playing out. That model's not going to change. We're not going to give this product away. It's precious.
It's value creating for the customer. We're going to continue to convert it.
Do you think closer to mid-single digit type price is sustainable out the next couple of years?
I think we're closer to four plus than we are to three to four.
Okay. Fair enough. We have a question.
Yeah. Quick question. Could you clarify on this Western Port versus Eastern Port dynamics and like in terms of the cleave also you mentioned that they do not see that at all? A second question just quickly on a coal pricing, does it really, in your estimates, do you project that it has to go up for your guidance to play out or $200 is kind of okay?
What was the second question?
For coal prices. Yeah.
Our coal pricing is not tied to the commodity price at all. It's a fixed contract that's negotiated with an annual rate increase. It's unlike the U.S. mechanism. When I'm talking about the cliff, it's based on our book of business. Our book of business is 1% China. We ship very little compared to obviously the West Coast U.S. roads. We're not as exposed to the China tariffs. Our book of business and our strength is coming into Canadian ports, going to Canadian destinations. There is strength there. The Canadian consumer is still in a very good position. Some of the things the Canadian government has done has allowed that to enhance the carbon tax they eliminated. That's putting money back in consumers' pockets.
Our big box retailers, which we're most tied to, the Canadian Tires of the world, that's a house account for us. We're 80-90% of their book of business. Loblaws, we're their largest rail carrier. We are their rail carrier in Canada. 90% of their business. Home Depot, Dollarama, those big Canadian retailers that are doing well with this additional spin, they're moving their shipments on us. That's why our book of business and our profile is uniquely different than the other roads would be experiencing, even Canadian National.
Great. Just a couple of margin questions, just near term, I just want to knock out of the box. You talked about 200-250 of sequential margin improvement Q1 to Q2. Any reason that's not right?
No reason at all. No, feel, feel very strong about that.
How about, you know, you've, I think you've also talked about a sub-60% OR this year. Is that still right? Beyond just this year, I think peaked at a 57% OR in 2020. Obviously, a lot's changed. Macro merger. Is that, can we get back to those level of margins? Can we exceed that? How do you think about the long-term operating ratio?
I think the first place to start, and I've said this, and I know you realize this, Scott, the operating ratio is just an outcome of running the business the right way. It's making sure that you grow responsibly. It's low cost. You're able to bring it to the bottom line. You don't oversubscribe your network. You turn your assets. You control your cost and you bring quality revenue. As you layer that quality revenue on, your operating ratio naturally is going to benefit. As we grow and we're going to grow the right way, then you should naturally see our operating ratio improve. This year specifically, we're clearly, we had a significant improvement the first quarter. We'll meet or exceed the guidance we're giving you for the second quarter. We do that. We're going to naturally get to a sub-60.
Because back to your original point, the strength of the book of business is still the second half. It is from the grain. It is from the demand. It is also from the comparison standpoint. If you look at our second half, it should be materially better than the first half. That is going to take us to a sub-60.
Okay. Maybe just talk about state of the network right now. Like, you know, some of the service metrics that we see, like in real time, a little bit of pressure. We're talking with Chris, maybe there's a little systems integration. Just what's going on with some of, like, near-term service metrics? How's the network overall performing?
The network overall is doing extremely well. The investments we have made prior to two weeks ago, and I will explain that in a second, everything when it comes to locomotive productivity, when it comes to car velocity, when it comes to fuel efficiency, terminal dwell, everything is moving in the right direction. Integrating it extremely, extremely well with a fluid, reliable network. Two weeks ago or three weeks ago, I guess it was May the 4th, we have been planning for this for two years. We did a significant operating system cutover. We called it day in. Essentially, we have taken day in. That was kind of the nomenclature inside the company to get everybody motivated to it. We flipped the switch. As we know historically, our systems consolidations have been what have wrecked the railroads. We took the very pragmatic approach.
We spent a ton of money, a ton of time, a ton of resources to get this thing right. We flipped the switch the 4th. We're now using in the U.S. network as well as the Canadian network, the legacy CP operating system. MCS, which KCS used previously, is gone. It's no longer there. As you do that, some of those metrics are going to look a little different as we get them all normalized over the next two to three weeks. That should kind of clear itself up. You are going to get right back to what you would see externally as no deterioration. Do not be misguided by it. The network's in good shape. Overall, I think it was a very successful cutover. There are a couple of irons, a couple of wrinkles we had to iron out across the network.
There's some in and around our very heavy industrial switching complex in Lake Charles, some in Shreveport, but the team's on top of that. I said two to three weeks that'd be in a rearview mirror and everything would be normalized.
Okay. We're running out of time, but you mentioned changes in administrations in all three countries. Maybe just talk about quickly, you know, where do you see the biggest risks from some of these changes? And are there opportunities for positive regulatory change in any of these?
I see, from a regulatory standpoint, I see a lot more optimism than pessimism. You know, I don't think I've been shy about it. The FRA under the previous administration's leadership set the industry back. They wouldn't allow us to innovate. They wouldn't allow us to use technology, which drove efficiencies and safety benefits. Quite frankly, they kind of had us paralyzed. This new administration is not about that. I've met with Secretary Duffy. I've met with the interim leader of the FRA. I know the incoming leader of the FRA. They're going to embrace innovation and technology as long as it drives safer outcomes and allows us to deploy it in our industry. I think that's a good place to be in. I think that leads to better service, lower cost, better safety outcomes for our industry, which are all positives.
When it comes to Canada and Mexico, I think now because of these tariffs, even more so than before, there's some regulatory nuances in Mexico specifically that impede fluid operation of trains. I'll give you a for instance, the grain that we take out of Canada to go to the U.S., the border's seamless. You go to Mexico with that same grain and we have to stop and get it fumigated. It has to go through time delays and extra handlings, which to me are not conducive to the fast asset turns and the service reliability. We've got a regulator in Mexico that's open to those changes and willing to make changes and working closely with us. I think in all spaces, we're in a place where there's less regulatory risks.
We've got people and minds that are motivated to do things with the industry that allow safety and reliability improvements. I think that's a good place to be in.
When you talk about the FRA, like what does it actually unlock, from a safety perspective and then also from a cost or productivity perspective? Is this, you know, small little things or are these big opportunities?
I don't think it's, we're not talking about hitting home runs. We're talking about incremental change. We're talking about track reliability. There's autonomous vehicles that waivers had been granted before actually under Trump's previous administration. The last administration not only did not allow the data to drive regulatory change, they didn't renew the waivers. They kind of put a kibosh on everything, kind of stymied and paralyzed the industry. This administrator is going to allow that to reoccur and to continue. I think it leads to regulatory changes that drive safer outcomes on track infrastructure. It allows you to redeploy men and women to do other work as opposed to going out trying to find problems that'll be able to fix problems. The same is true when it comes to the car department, when it comes to unnecessary car inspections.
Our sale specifically, the inability regulatory-wise to kind of benefit in Mexico and the Mexican-U.S. border the same way we do on the Canadian border. You do an initial terminal brake test in Canada, you can run a train to any destination within the arrangements of distance and time, you can go to a U.S. terminal. The border's seamless. You go to Mexico, you test the train to the same standard. You do it in Nuevo Laredo at Sanchez in our case, go 10 miles north to our Laredo yard, we have to do it again. Regulations require that. Stop the train, delay the train, delay the cars, inefficiencies. This administration is going to allow waivers to be approved. As long as we meet the U.S. standard, we can make that border seamless. That's the way it always should have been.
That's the way it will become with these regulatory changes.
Any update on any of the things in Mexico, passenger train, anything like that?
I think we're in a really good place. Again, administration change. I think we're in a good place with President AMLO, but President Sheinbaum, I've had two meetings. I was down there six weeks ago. They broke ground on the passenger train. They're committed to a separate line, a parallel line. There's going to be a dedicated line for passenger. We don't have to intermingle and mix with the freight. We'll be able to still run freight trains. The beauty that's came out of this is not only have we developed trust and respect with the administration, they see the benefits of not just getting people off the highways onto the railway. They want trucks off the highway onto the railway, which is a good thing for our industry. The regulatory changes that will enhance and incent that truck-to-rail conversion to actually occur.
You,ve got to wrap. Anything we missed that you want to make sure we understand?
No, I think you've covered it all.
Awesome. Thank you, Keith. That was great.