Union Pacific (UNP) 20 Oct 222022 Q3 Earnings call transcript

Greetings. Welcome to Union Pacific's Third Quarter Earnings Call. [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. Lance Fritz, Chairman, President and CEO for Union Pacific. you. Thank Mr. now may begin. you Fritz,

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

labor service note the Before for their employees dedicated on hard discussing to thank process and past recommendations work. Board months new we our negotiation. our throughout to their roughly complete several reward our craft results this also for lengthy the with agreements, The want the forward levels. of half to agreements the of Presidential service looking forward. recent improve efforts And for move the unions based our quarter, over employees I'd ratifying I Emergency professionals are tireless very

results. XXXX $X.XX income Union our $XXX to morning, the Pacific prior This million turning These charge share. per $X.X reporting is impact of related agreements. include for results third of Now new to estimates the a net quarter billion quarter period third labor or

adjusted $X $X.XX share. XXXX billion compares income that per per quarter net billion results to or third or $X.X Excluding This of $X.XX charge, is share.

team, from fourth growth demand ratio Our better were core inefficiencies steps strong as network you'll income that basis and points surcharge and to adjusted offset quarter related we're of increase operating the fluidity produce And meet during meet drive better customer is and the XX.X% progress real from inflation to take quarter by demand. operating network. third ongoing costs volume in continuing and higher to made revenue, to the quarter to growth We XX%. XXX of pricing the hear network than higher adjusted XXXX. fuel gains Costs

organization. originally mindset played While we're instilling out the have our growth the as within that our peers, planned, demonstrating volumes hasn't our year outpaced

let on that, turn Kenny an to update with So for environment. business me the over it

Lance, you, Thank and good morning.

compared ago of our business to all quarter was Third a X% carloads increased across as up year segments. volume three

demand Freight by Although we continue network. pricing up overall volume the revenue XX% had the to up, table fuel we was gains. service improve surcharges across and driven on undoubtedly as higher strong was left

Let's each carloads January the year-over-year natural Fertilizer domestic refrigerated contract consumed wins potash. Grain down and and diesel. take last on started biofuel up look up in was remained favorable a up Starting X% fuel XX% year-over-year. core the Coal driven at to per carloads products was reflecting higher two strong flat shipments with these shipments solid with X% of lastly, revenue export increased due revenue renewable closer year for groups. gas And XX% a volume volume X. Volume business driven quarter renewable surcharges domestic grew Bulk, by and to in reduced feed grain that and gains. was and grain by average compared car, pricing food prices continued and increase for X% year-over-year quarter. of X% were and

an core Moving revenue car per X% average for X% down driven to pure changes for market. up to X% in gains. fuel on increase due by in forest due quarter petroleum was XX% Volumes higher products and in year-over-year the shipments by primarily driven specialized Mexico to revenue driven regulatory XX% Industrial. Energy and were down shipments primarily was surcharges XXXX the Industrial improvement compared to an by volume and a pricing by compared X% robust volumes customer business construction to primarily new continued sand were Metals up metals business XXXX increase growth in X% shipments, year-over-year boxes. Industrial to demand. demand to development. frac was plastic for lower growth. year-over-year and corrugated Volume to up due market minerals partially offset was chemicals expansion and last deliver wins, materials by driven shipments. and This in year positive lumber and compared shipments

by inventory Turning and strengthening a higher in down pricing increase quarter driven car Finished volume comparison to Automotive intermodal XX% due parcel Average fuel increased revenue XX% primarily per Revenue XX%, to up decline to was shipments. X% X% increased and surcharge year. increased a a Domestic due replenishment. by Intermodal was parts XX% vehicles and in demand core volume. premium. was XX% flat. for on softer volume up last softening the revenue gains. against production was by auto by driven XX% from

However, inland carriers freight international ocean by X% volume shifting to more from strengthened terminals.

rest Now see rates to with the here volume. interest markets closely macro moving level, our a where At to for will be how we our overall and XXXX. But today our watching impact our will inflation is of sit markets. outlook we

bulk with Let's our commodities. start out

wins. biofuel renewable expect for and development to due shipments We to demand continue diesel business grow solid market to

demand we natural both domestic export generate prices gas favorable for For continued coal, to anticipate shipments. and

opportunity our But comp dependent And have recovery. mentioned However, a is the fourth were in to quarter dependent strong we've is for on service on also as the the resources. demand grain tough last year. outlook available as capture we exports our before,

decelerating, is products. Moving forest and to Industrial. forecast industrial on softening The demand for is production in

intermodal premium, demand a monitoring to and fall for we due the we However, closely spot as And be construction lastly, to in positive truck project domestic demand inventories are strong rates climb. south. expect

for shifted improve, operational replenishment. driven by us the we due XXXX. support to foresee expect With still Automotive head inventory performance. the to and and to consumer to Crew growth preferences that, more as fourth continues we in environment soft in expect over to markets We watching help also be the Eric easier We're international to our closely, review fourth demand supply for quarter we be truckload growth development a but to And we into parts demand improving expect turn favorable Overall, more capture and versus as remain comps. goods. our will experiences positive to business parcel I'll quarter. have wins availability which it

and morning. good Kenny, Thanks,

to Turning Slide X.

Safety year-to-date business: and demonstrating and every Our to of are our compared impacts customers facet XXXX. employees, improvement shareholders. our our results our safety meaningful sustained

system our a #X home at the returning management right of Taking on promoting end priority While the remains culture, day. at employee current network safely every safety our is look XX. our the Slide performance

metrics the improving third quarter, utilization. improved Our improved hiring operating and from steadily availability through aided initiatives, recrew crew crew rates lower by

XXX pipeline training expected employees we To and to have XXX have graduate of hiring Our in and training, XXXX. graduated currently strong. additional an by January is date, all

to graduates of transportation weekly locations, from April. our its been back is utilizing into day, more while carloads. crew able employees grain hired encouraging, moving add Even more miles the up low exceeding to challenged employees, By XXX XX,XXX improvement now per we the XXX have year. and for more goal adding X,XXX in borrowed have our out car the velocity new We approaching came sets coal network. approximately some new and Freight

We state peak year. of also to the is Exiting a X%. the our in than around recrew reduced solid network quarter, the XX% rates earlier in from third now and fluid in more April a

improved are cost results we the Going upon excess forward, to network. drive building these from

even XX, our performance events. metrics comparison starting last easy wildfire which review considering from year's XXXX for key the compared Slide to let's remained on relatively quarter, and challenged when Now the weather

flat last manifest plan times strengthened in sequentially to impacted by and was chain auto street supply quarter's results. challenges, resulting well. chassis compliance velocity trip car and However, and elevated container trip ramp Intermodal compliance both from remains sequentially persistent freight and plan

decline. stacked the containers We ports as the number at continue to of Coast West make progress

XX to Turning network metrics. Slide to efficiency review our

stage and utilization. During to the across to as network overall performance third improved, quarter, remove improve were locomotives we the able fleet

a improve fourth train locomotive as remains last year's productivity speed result, continue continue strengthen to well. did sequentially improve As below and productivity other locomotive Entering we will to metric. the as quarter, although measures,

increased. will both four Third and top sidings This XX. productivity the plan. by up sidings total product productivity. is work an our longer labor third improve length anticipate X% workforce the in effectively the to resilient as additional key done. volumes. our compared miles as sidings completed to our XX. XX original quarter encouraged a increasing in was to drive XXXX made, our yet XXXX utilized the use the since Train These improved sidings service progress completing bring our we've and Slide Wrapping not and a trains PSR will more quarter principles, We of our now are to ability team Using force but enabler further on handle I'm flat on of build XXXX resources we car network.

using our reducing than dedication. safely the effectively. trajectory always Our efforts and my Pacific, and we remain even Ultimately, goal, team focused improving locomotives goes their further reflects everyone as great on the have variable To to manner. storage. at to point inventory, finish XXXX, and we for bringing manage in efficiency thanks are operational Union excess point, we and out capture as intermodal more need network to crews this the is areas, of To volume same time, of run cars international while the more levels volume our storing cars the that demand we did well excess to in are materialize not expected at and other we out assets a

continue bulk support employees hiring locations our region. send in to we additional crew-challenged to will programs demand, Additionally, and borrowed-out northern

customers. a over confident the performance. With for are financial up better I to Jennifer to our wrap foundation we am turn provide the it forward, I will and product that look I we As our will year that, building service review

Eric, a XX per down good walk of to Thanks, our and share. start operating with earnings third going on and morning. Slide ratio I'm quarter

earnings per by negatively ratified million quarter a to related basis change and estimate Emergency labor points reduced ratio Our At million of and impacted of in charge agreements. a recommendation XX.X% tentative reported $XXX $X.XX the the and third $XXX includes ratio level, XXX operating operating high EPS and Presidential $X.XX. by share subsequent Board

in however, slide ratio EPS. far while reflect granular continue on important refer points inflation It's presentation of back payments. more at but inefficiencies deck. we please not For charge, basis accrue the general for wage to appendix was off impacted unfavorably operating weren't results to note, the accruals the the as information our and $X.XX annual that to recommendation, network the PEB did XXX [$X,XXX] quarter bonus to contributed the Core our the

our operating EPS. fuel points versus the two-month prices lag basis XX second Importantly, improvement core surcharge added by XX impacted program points roughly our to basis ratio our of the in and and Decreasing in quarter. quarterly did quarter the favorably in operating $X.XX we ratio sequential fuel make

wildfire quarter to and last basis Finally, favorable and OR include $X.XX XX comparison year's also EPS. results third weather events, which to adds the to points

on XXXX third my adjusted of growth. our will speak I the year-over-year the XX% $X.X statement totaled on labor numbers X% adjusted Operating remarks, to provide income where the Throughout and now exclude Looking billion, that revenue up Slide reported versus quarter we at both volume impact XX, charge. results.

As we the higher year, have primary contributor increased expenses, seen fuel higher the XX% to billion. operating to prices $X.X are throughout which

in expenses Excluding the impact XX% fuel of our were higher the quarter. prices, up

Third and reductions a pension Income quarter in including Other partially a XX% $XX by operating by $X.X million increase expense billion, on a XX% three higher gain $XX sale offset our versus income income corporate result higher million income pretax adjusted states. increased totaled real income, increased of as income, rate operating estate driven of benefit. tax XXXX. tax

were As a be to earnings adjusted billion year Operating net changes, net per XXXX, $X.XX. $X up was quarterly to share versus Adjusted our around revenue, and tax we now operating those income result and full increased per income, XX% income records. of XX% share rate earnings all of expect XX%.

surcharge contracts prices impacted positive which fluidity, third improving the efforts in $X.X and sequentially up volume Lower shipments, freight Looking Total part at prices. negative fuel a the combined gains mix. more revenue Fuel reflecting year-over-year the from program. Year-over-year higher the a shipments, business XX% our freight supported drove XXXX. auto lag coal revenue, billion higher by recovery to contributed quarter. diesel operational breakdown, Slide XXX $X.X points, the we was totaled XX closely revenue impact revenue From negative freight Strong business a basis natural in when revenue XX two-month provides petroleum versus basis gas indexed standpoint, billion, pricing increased revenue have now growth. mix rock price of points. quarter with development slightly benefit of gains, and our XXX combined surcharge lapped with to points and

the Setting these in So network benefit for price limited that a we year. experienced fluidity the will are the yield as the we minimal. with And both higher price exceed second at mix. aside, of the dollars inflation that we hurdle expected year-over-year upside start dollars quarter, inflationary and even than is headwinds confident

our up of increase summary driver on a again a provides which fuel, in fuel where the quarter XX, third XX% Slide adjusted to on Moving prices. XX% quarter expenses primary this operating was

in our fuel was second $X.XX than average down we quarterly only quarter's lower price. the $X.XX some come prices per price saw While fuel quarter, gallon, average

Our more fuel-efficient all-time the in improving fuel consumption achieved a XXXX gains an record as quarter, and quarterly of result a X% business rate versus productivity mix.

expense workforce annual million bonus. Total accrual increases our closer This adjusted quarter's related Looking engineering grew expense increases were and XX% and year-over-year workforces $XX in levels third X%, versus X%. reflecting other lines, training was while up quarter increased pipeline. at wage the benefits XXXX. and engine mechanical additional for and includes an train this up Management, to X% primarily compensation crews

wage anticipated, higher we Eric, by X% have exceeded As goals. our driven now than heard in per you XXXX inflation. primarily hiring Cost came employee up from

continued network overtime with experienced cost to inefficiencies and borrow-out related costs. higher also We pressures

grew and and by of bit associated than more X% casualty the damage around subsidiary increases. locomotive expense Loup X%, quarter, expense line than tentative decreased be by a that wage inflation. fourth our volume-related Purchased the higher associated income purchase materials result XX% driven anticipated a fleet, increased Equipment and offset expense to with For XX% increase hire up we expenses. with increased transportation maintain we ratified higher a equity and as services injury. loss remained with quarter, rents and freight car higher elevated, year-over-year larger in cost active personal in driven expenses the to other and expect Other

quarter, of of and other expect receipt in benefits For Overall, resulted be year's just expense last inflation cost incremental the are to fuel-adjusted inefficiencies bridge volume XXXX we anticipating an as insurance versus flat settlement X%. the for offset leverage margins we and the fourth of fire.

positive momentum results Although with and wrap progress reflects the can not we XXXX. as second it we know we provides still up quarter the from achieve, us

operations X% Turning XX through the to quarter cash and third Slide our billion. increased Cash $X.X flows. from to

cash comparable cash free was flow billion. and conversion Our totaled XX%, rate $X.X flow

it of a this and decrease XXXX, versus increased includes is in Although $XXX dividends. million higher million $XXX spending of $XXX cash capital million

billion, guidance, increased full XX% $X.X With within to shareholders be date, spending XXXX around now up to capital prior guidance year less from well of than the we our expect but of Year-to-date, slightly capital overall our revenue. level returns returns. firm in expect of billion rewarding demonstrates now and share through $X.X back shareholders dividends repurchases, to $X.X repurchases. have received This to share buy we strong to XXXX. our roughly cash Related commitment with billion

that at Although expect pressures pace quarter by impacted costs. in inflationary higher-than-anticipated a we repurchased strong service the shares the third remainder continue for year, been and to the of have and we

third X.Xx maintain Lastly, a to ratio a investment-grade comparable we strong finished debt-to-EBITDA rating. the of continue we with adjusted quarter credit as

to year, X in bonds, quarter. the we received of of plan are In billion up fact, included issuance. million a an is and Moody's are AX, during now in team on across the first during customer XX. With green momentum demand. quarter, our its Wrapping we upgrade issued little debt, The all left performance unmet and the which A-rated quarter, months building from focused agencies. on we positive improve additional Also $X.X third such the to $XXX we upon capture operating the on two over operating Slide credit executing

impact outlook around changed. operating XXXX. on full expect ratio to our reported is that slight the more resulting year growth in now X% however, from range and ratio also operating overall agreements, has the clarity As reduction more volume expectations, our We for in new labor you XX%. from are With bit, a full Kenny, be the markets of year now softening heard our a in

close attention we to out is turning quickly XXXX. As XXXX,

not ready are to long-term our is share it to important we reiterate our outlook, yet While view.

mid- those committed on returns and Since in focus XX% improving established road employees XXs. has those to The to goals. same, even them franchise, a unchanged, we targets the diverse a with the Investor changed the margins firmly With leverage higher of Our foundation to by and at generating and outlook. remains goals May still achieving achieving achieve economic Lance. weaker incremental our achieving and strong ratio upper operating ROIC cash and to XXXX of UP's in and strong pricing we establishing is now the a milestones quarters, to supported but the environment are those road few bit to great volume, is and longer, Day a will turn and success map our that, I'll inflation back our productivity it

Thank you, Jennifer.

sustainable As you our encouraging. metrics very heard which from is have Eric, good safety shown year-to-date improvement,

safely relentless employees is ultimate every our the remain day. of to home important important of and goal. that However, most go most all metric pursuit for in We

footprint front, Wabtec years. the This On is billion $X a the to and meet game-changing next our as key with Pacific. investment quarter, locomotive work modernized Union need modernize investment This during is reliable. is true targets. a as the each sustainability also over agreement announced reduce for our we locomotives significantly This carbon supports our three XXX more we customers to SBTI what XXXX

with a Schneider, to long-term Jennifer's great out like wins on bill. although available look sequentially we XXXX to strong the demand point plan, industry, the also our positioning and And us to want infrastructure as demand we're putting like we close our improve relative our expected view. capitalize XXXX, coal our customer business positive considering operational efficiency. our together I the about impact to reiterate As still we associated construction to we

our line together. open for and incremental let's high that, our and XX% up These operations, operating employees, safely And shareholders win the will improve our achievable. your goals are customers, committed ratio to achieving as We With are questions. efficiently we to a our communities margins. all mid- and XXs

the line Ossenbeck is Brian with [Operator Instructions] JPMorgan. from our And of first question

just too touch the to rejected about stronger process you point. it's just the visibility of because in And have the also, on dollar given on some there. Lance, through the you at you? contract, still you ahead little past the of rejected appreciated believe and and Kenny, of of said one more volume to a this as importance I counteroffer confidence update it go to would for the thoughts So unions talk early can bit disruptive I Rail XXXX, end know An that, last growth visibility more maybe but you Conference areas impact various National the update the also on And been timing negotiation the and relates be then, considering it the has their any markets I and to night. wanted

Thanks, Brian. I'll with to growth over it potential. about turn and at we'll negotiation, Kenny talking the start labor for a look then XXXX

then what that wages. work vote the PEB goes they sometimes comes that take work back. reasons, more got sites, still, So when about ratified. on BMWE, we've ratified both of the the six to have got we site we maintained maybe rejected days for couple then And back property, and A that's quo to ratification negotiation. to compensation note. works XX%, are reason that their original the that of change industry, for to about we've unions. early unions work in recommended with half look that not got away-from-home an team overall UP out to for we're and into of out for predominant ratification a the status are BMWE seven recommended at BMWED on votes got status the membership. the negotiation, of be for their That's the because agreed-upon the their five unions; And also, one negotiating We've four quo or travel they things while think back and We've is

and So just week. from per That they're a in travel away negotiation property change UP diem on the a last finished up in change home. allowance that while

clarity straightforward. so was vote that And think the there a members were have vote, that of clarity that as more section ratifying it really makes the We didn't they to.

and going that's it that's when possibility, confident the happening strike. what's agreement probability. for that be temporary think exactly our to is a get agreements ratified That's going back part a remain still the ratification. negotiation able Ultimately, to embedded we're but out to of don't so be avoid goes I it's I And in a

and currency Lance what up We're how back and off money. start little going backwards looking and really we in services Asia is here evidence their some shipment. I'll first. than of We're So you're parcel the spending I from that goods. on the recently, here evidence at take more question just the right saw the talking seeing came We're a spend to the they're consumer show now the about. seeing that

watch to that pretty And week so going to closely we're just week.

three emerging bring market encouraging book call plays on. to us. months, is new little biofuel to is really order as a his leaders for that us, talked tough we'll that out. comp, some going going good the on. which Eric about and one up I have we bullish how business. being a resources of feel and agile good very resources, So here We're done bit coal market our coming be about to and it, are them. Obviously, of On very markets of Grain but for in feel an put see incremental next, of six a the job that plants capture our we that is on team customers commercial to the two

Industrial off the little our side, housing a On shipments taper markets, bit. we're lumber seeing

I'd that's about shipments Industrial the our things tell and product of for relatively is us. rock on a are the that positive you still side, so construction One strong,

strong. has construction roads. the been lot business A metals of into highways rebar for goes Our and materials

at facilities of business, encouraging about their today. XX lot low. helping and the up. They're is which Dealer about So Automotive are -- is I talked Automotive also up. that's for sheet other the us. that out coil supplied being is A

eye us. the teens. an keep We've OEMs digits, a going we dealers a for talk again, is for That's easier the single the in then positive through to inventory in we're to, domestic quarter, going early bit international side. dealerships I their It the of on us. little supply a on, their got positive we're comp. that an moving Some at rest The be will to this for be the as mentioned And intermodal of

Our from with the next Citi. line Wetherbee question Chris of is

maybe I guess to I ratio. operating year the clarify point full a on wanted

So XX full reported I I sure, make year. for just wanted said think to the you

third include $XXX I So the first sort my excluded does guess million quarter? adjusted question. of the that's that's that from

moving piggybacking forward, Just it seems given can cost a ratio like be on maybe about dynamic? third you bit That a it sort decelerate step-up with But bit bigger that, fourth the sort versus that? as of little on of the in of sequential sort quarter yields think than the Can progression, the like on talk just the just little what's you normal a quarter. about operating going probably you would sounds fuel. seasonal helpful. elaborate in bit Maybe

Chris, and that Sure, question. for thanks

hear right. did You

reported ratio. XX% is the So operating the

So was quarter $XXX mentioned my million impact as as charge impact, change well for that be the in million we the in fourth PEB, I the took include which, third that similar relative in ongoing does the quarter. the a and remarks, the of $XX the as amount estimates will the in to likely

inflation. have absolutely that we do So cost

is a we You That referenced quarter. it to flips tailwind fuel. headwind third quarter quarter. for going in think, the fourth fourth us, amount, us on decent also, believe, where the we That was now of to a in quarter from think, to I flip a back third

going bit look move negative bit going we little the us in that's That's a for be to worse as probably quarter. a the was third of into an course, here fourth So to And quarter. little impact. mix

as things, all in volume together take costs to offset particular, on putting those going network. those inflationary you sequential still price, we're of the the timing deteriorate some headwinds. expecting But with we we working we're is basis, kind out have with on and to we're there. cumulatively So And of a as ratio some while operating bringing to those confident things very even more are know, that there

Our from is of Seidl and question Jason Cowen the Company. with next line

both international. a on break intermodal between up Wanted bit side to focus the and and domestic little

should about shift we side, what of domestic the And in Coast? you permanent be forward obviously be from long truck the about the of East shift international yields? out in how you the to much market do Coast sort seen challenge. should going think a On West bit we of we've called going the weakening that the side, a terms that traffic How as term? a think a How will big think of little on to

Kenny?

Yes, of off I'll walk just intermodal with international start through it. kind and the you

First of facilities increase. is us one inland we're move that all, percentage Coast our to of encouraging goes that the the West seeing that things the traffic is to of on and to

of is And on so again, that that means that product less West transloaded being the Coast.

in So that up, us. customers light. pushing against I'll That's We're up that to product is solutions a us. encouraging our positive it, to call and

relo Also, Dock For Katoen Global example, our up August. there. West-bound traffic Dallas had ag to in facility X our facility last we quarter opened its highest volume of

a that are those encouraging. things doing the lot make we're So to product more

the you're closely as at we're mentioned of fairly into year. mind that domestic So about the keep kind I Coast out side, and East last again, in heading of thinking versus our business, the that fact West Coast. in parcel part Then as looking that on the we're the the called

X. seen in inventory in, little December We'll about a is a seen We contract have We've rise is our very it, haven't small bit. seen that -- that We but more we call we rates some which into terminals to head the know season, the the spot that degree. bid in reflected as lower, inland a of rate.

pretty off inventory get of back in through well and the that street fluid, ramps U.S. We've inland by down normal. box through count looks We destination just to boxed thing, Yes. and of able warehouses. good. to still taken And to the going ports we're off is to times the with ports. on and lot one And to inland, boxes the consumer some add get right? us now. right encouraged to trying Jason, issue the an movement to have back approaching There's normal. sitting the I'd That's is a That's side for process chew international be of warehouses have the and that boxes between of

And comments about in we on truckload see Okay. on -- yields look 'XX? think pressure made the contract a we bleed yields, rates intermodal the and any the about if that I do as to how Kenny, should we side,

of again, the all tell. tightness I'm up it's firming not might all, just ready Lance Hey, contract too I a show on to about, think, not soon side. in that concede first prices just talked little to So the

a little too just So it's to soon out. call that

we'll the to out. and bid headwind it plays Doubtless, see season, through there's just how have a there

Our line Evercore is Jon next with question ISI. from the coming Chappell of

even Eric, probably of these resources, into most you're year you slowing productivity, et labor, trying for that And last close, you a bring there, on but you mostly all feel not getting this if cetera. much fluidity to now of demand needed like spent and year, resources backdrop.

a intense these to you the in from forward, look prior is you you some the going the than the flexibility even you've short that challenges to had scrutiny had and weaker maybe demand you've you regulator? cycles Or maybe given if as keep the about down nimbleness have do bit over-resourced in more need more that network expect? do So term, and those manage resources of

unfortunately, comments, made want Yes. that out Jon. down with times, our we doubt, to to as I In be line volume Without multiple demonstrated we in appreciate that ability volume. the point bring variable. than a my I in question, we've have a more point resources prepared to

is efficiency being playbook demonstrated that. do we've an to in able and that known, So

be that and we about point, on. Now as to we to last focused we that X.X think years your three there think are things the about continue

matter Our is remains market ability what hire critical. to the no

work on how to we continue population. even making we of think our jobs As that, to more the about attractive part

hundred and of for buffer. the that a of to can a as in we no to reestablish see It's the we balance continue couple a to as is, have will them, It's of had what attract the downside. So matter and us, on upside AWTS, the people. market the need. us past, same bit is react we've At both point, which way a thousands your be be able able people talent the at to we not to little time, you resources to look

our that we're have have learning even playbook. playbook to continue that ability So make to We it, stronger. to lessons we yet execute take clearly we demonstrated

Next from question the line Vernon is David Bernstein. with of

you hiring you're and for don't levels of the in a we we but slides think where in you think do X,XXX, to T&E that year. from thinking we resource be? catching Like about goals need this can the -- you need process if much service network? what are your of you mentioned terms to everything perspective to getting in of that next maintain Can you you you X,XXX get ahead of there? for plans Eric, Obviously, hiring about the are headcount headcount to help us we you the kind still more -- else, year? Or the are are volume have need for up to how

Yes, question. David, great

reiterate, to we people. start year So set the hiring X,XXX out to

done that we've comments heard my in that. You prepared

have X,XXX pipeline. the that been hired, of training admittedly, and they're Now X/X in

the we of them now see year, -- benefit of between really. having So won't end the year, until towards the end and the of the

We'll we looking think of short close fall the as process on out Kenny the hiring. about are out past at obviously don't markets. same our as pointed hiring to we're really we use to attrition. we about stay that that those. the We'll demands, As the focused look, at you And ensure employed as questions time, we've same in highlighted, there and

of the regards to a with we're with questions couple our react some that accordingly. have ratification to of to and employees, You of are the outstanding going population that implications

about it's do and be staffed need for we markets, So what that attrition. the contending to to with really

around you there to people buffer in sort those Or -- hiring that off of contemplated productivity some to of for outlook? add do also having some that's pay, how more about -- from people staff? is we Is your bit think there's it that something that on little of time standpoint? a is need in a agreements think right extra And just paid that

It's around has adjust off, are agreements always the been additional there contemplated and still Certainly, are out for for questions and accordingly that that. we'll contemplated. ratification, time inside

rely and can I AWTS making a of part it's people, we -- think something that hundred we viable, couple it's sure think is but how it's that program of the do on. again, that and more about and important

variable remember, those expect But be David, I important volume that we this, can think we it's to with and still even said agreements. Eric

in see the going grow volumes happens to won't -- you So we're what to headcount see whichever exceed the economy, same extent.

of XXX%. to the our We be this One needs here. that, unscheduled of to been issue the we underway. crafts, off. do address the happening. in time a feasible. off David. jobs there's to we've and in design. substantial that impact absolutely ways of a across time don't job far layoffs. some get of right? scheduled trying got to without to we're do think last property through there's headcount We And be crew large kind make We've committed but PEB on that to with That's overall get to trade-off requirement note, you way that make trying think Part thing a and to and on employees that or try think impact don't on a what path week, specifically find it's that. meaningful started do it's step in you we're to employment We you predictable, carefully to addressed flat the a bigger going because little availability We think negotiation and negotiation and spikes is is So is availability

crew give us better availability. actually could it And

XXX%.

That gives us opportunities.

from line Ravi Stanley. is question Shanker Next with of Morgan the

confident that parts the targets. to a inflation year give going macro? get of you of you're But to us in get to the on inputs that line it's get you I wanted are reiterate moving inflation kind guidance pressure -- you pricing XXXX the or and obviously, see what's long-term guys your with right sense anything, higher So Lance, over just can you I from and early too next with now, the did top all commitment on then

parts. yes. can our lot putting Yes, tail be pricing get are plan at is to really real. of Ravi. moving look we starting of at above a There budget year. are Longer sure, Inflation together up confident But and as we or answer, are inflation. going we answer, a for quite there Short some end next rolling headwinds the into

Our from Allison of the with Fargo. next line comes question Poliniak Wells

you're out table. to back about go what you you there leaving any Can or that impacted think your accounts? put faced conversion the headwind there? to to then comment you demand guys want on And you as potential new customers, year maybe the that Kenny, Just some to that service was? that quantify this thoughts of I help new understand talking challenges us has

Yes, probably of weeks and second a network. week couple tell of Allison, of for couple to I'll it things. in our hard that's One noticeable mid-September, in premium carloads, probably lasted network a carload in our a September, than you, dip we is, our Clearly, quantify. more it saw was

So Allison, I can't you give number. a

her Yes, table left where can in left Most some table stuff the on likely, we at, tell right? the we grain. probably coal, it's on in

I think looking that's Allison for. is where

or market. unit our in mostly On our say, I'd train Yes. mean, I market, -- bulk

in little there rock a business, some look you on little network. bit grain fertilizer And more was our in business. business, demand bit probably our at a if So coal our our

business, which crews our primarily with train a associated consumes bit quite resources. of and So unit

was the it's And there quarter. quarter, less think say I the in to that as less entering second there's Allison, quarter fourth And in the safe we're than third again.

some right? idea to to go have The performing. we good because that's performance-based, you table don't is the business, resources sure that issue you have that on people demand There's isn't we're demand So when leaving the making not unmet at point, the not you're away, weren't running all want it's for for. whole --

more added I'm have in. sets this So and the did encouraged Eric that have resources, thing more by, about we talked is and we

it. do more putting have against are up coming on. crews resources more We We

now better Lance, is see place. operating that it, on encouraged What commercial but we're we're a That's carload in more on our side. today. unit don't third, with working a working in the talked you And second network. place closely about I'm we're the better you to together. So is team closely train

on do capture demand. where areas side, if bit the we little supplementing and are of we're we of a boxcar So lumber see seeing bit little the to softening covered hoppers a

customers The other part coming into you talked network. of I just the overall that, think about new

Our customers of the terms resources. that hiring getting of of in some we some the and same face did challenges

to that. it challenge more So give resources a, them realize for confidence. We're more for They a they short-term that, putting us. I'll call capital growth. was We're that understand the on bringing

lot a good about our customers to we're a of lot talking to us as in gives of that things future. articulate the our preparedness so And

Ken coming Bank America. next Our the Hoexter line of question is of with from

little get employees XX%? just to speaking the to and how to maybe that do trip particularly onetime a loosening Jen, It do was improving on PSR, I falling year trucking still like for made still X%, but differential. guess you It then full looks And Kenny. I is maybe up able rough is the you you it to we're on quarter outlook like XX% I more then, bounce what fluidity, gain should looks volume that the have rapidly back. environment? we coming your are your intermodal, I'm your thinking pension? the plan if fourth down with But win target X% Just given about been after compliance share opening here. mean, target. that share environment, seems given demand And how can win clarify on, like in morning real volume but ongoing? estate clarify you just versus comments some given just

Ken, let Yes, and with we'll to start Kenny. me that, it give then

actually sale I had real this in through have fourth had the that was real estate seen income. $XX higher million and should think that we but But magnitude, we don't of more with my that the quite to onetime-ish. was that $XX probably maybe year impacted million, consider would we $XX it, that side, to is about, benefit, -- something most I that pension quarter That's I real the into a piece So call the one that a income on estate sale real said We the other million. but that, estate a remarks, called we said The out estate that continue degree. year-over-year. not

Yes.

a really earlier as bit our we little premium a on side. this mentioned I've bag mixed it. So It at look is

quarter. intermodal, at shift looking We closely. be international fourth up that we're Domestic in preferences. going the business be to talked intermodal about expect our in I to the

XXXX. up quarter mix Now and I fourth want to

increased against in will Looking us. intermodal positive bit up be into market, is which a great clear coming road that capacity on for we're We that's we've in do win precision making. feel we've about tech putting our about that of large you of there in gate quite ramp asset line of this the on. that pushing investment, of feel network it private How there, investments great the the XXXX, made type terms we're experiences will got -- good for all base, over another customer sidings be a that driver which we're both of the We technology, the terms lengthened. it's

a investment be it bit we against putting network as prepared into to of future. quite are with intermodal to grow We that compete the up look and

quicker they trip snapback question given your answer better as you And predicated, short premium is the I side. your is your continue to plan isn't why Ken, of, compliance part manifest And expect on PSR, to and on improve.

of approaching XXX as improve. last second couple that now you posted what XQ is the continues to for number is Q XQ. And in much saw days, now we're which velocity, car better and see we entering As print

to you you XXs? gets from Is speed? it you were back Is what the the that employees? where the What XXs, is running? to it But XXs the gets

Yes.

congestion the we and the pointed regarding in Lance ports opportunity translates. through. really working have the the earlier fluidity been we the biggest conversation So is out that west saw That there. have And

a as gains our terminals velocity portion of the has basis I arrival performance a well at that If look side. people contributors throughout and over them it I fundamentals, on the Those at improving been see our markets, daily you our When departure, into quarter, are in this on are Yes, particular look big week as intermodal about are improving. both week. helping to additional increased TPC. those really but is certain

is the Scott with Wolfe of from next Our Research. question Group coming line

be in about picture, positive this to of basis OR positive adjusted? this going year relative pricing then that to just down or margins inflation. XQ Jennifer, the the And that bigger and is price volume, the XQ excess XXX points you with deterioration, year. reported are reiterated to But

to So importantly, relative And connect maybe XXXX? the we're what's XX maybe just seeing of those in just next sort OR your OR confidence this then year improving more comments. two help of

Yes, Ken (sic) [Scott].

on So the a basis, adjusted, really some the here not sequential is deterioration quarter adjusted comments talking about about so on that see basis. the adjusted fourth We XX.X. reported

So that's a good clarification. Thanks for that.

pieces moving the XXXX, economy doing. of to opportunities going of the what's terms grow. have still parts. really together plan and and In putting of a again, be to Probably But we that biggest lot the know part is we that

that. talk Kenny heard about You've

Lance heard You've that. mention

We we about improve also opportunities in the overall our price the talk and Eric know confident And have continued heard ability fact you we price efficiency. that opportunities, certainly have the feel dollars. our to we very to that above inflation

numbers. we confident sit together, from be going today, improvement those to as going achieve things to all putting give able here I'm are will that XXXX. we margin But So any obviously, you, we XXXX to not

the positive of we And know? away could maybe X that giving X it were like price positive and next maybe volume, causes got year not, up points just what differently, margin, of points go we're if and that don't to maybe I ask or

the of the about Well, margin this service quarter, talk we we'll XXX quarter, I and deterioration mean, of this in terms points had just just basis inflation. in inefficiencies

that points. right is So your there XXX

can and inflation This number have inflation year And year's going X%. so to next offsetting yet, we've do an inflation, to would what be going than while don't seen for higher impacted higher year the that, into X%, that by was the be closer be wages. we going to the we probably it's certainly be thinking came to extent to probably that around historically, better

these we've the as gotten So settlements. here of of back -- and it's half accelerated, year had obviously, and the some wage in

in market, our So to approaching but to some catch a are the that of do we're with as it bit we confident our ability and pricing that. up to takes

TD of is question Radbourne the line Securities. next The Cherilyn with from

us has progressed have year partners as of opportunities both perspective could in give hoping to tailwind based terms congestion onboarding whether the In on a that chain table ahead the supply to on left may the the Knight-Swift the which of first intermodal business, you think extent you represents was look how XXXX. I some you on year-to-date, and

We very encouraged. have been

dwell agree should where I to it Both have chassis think time chain Knight-Swift for also some stayed onboarding some elevated challenges, stayed each pretty very there other. has is supply would be. now. gone but companies close actually It the have Sure, not well. very been

some But word we well, them be you volume use So the as gone tell tailwind can that into move kind as has onboarding that and the I loosens very of seamless. there I'd up could future.

from Suisse. of with Next line Credit question Rosa Ari comes the

Great.

I how was And pricing driven you Lance, have about further that could of efficiency there? I to little And obviously, kind that to hoping that's customers extent might get primarily able the on elaborate then been get to labor as know bit. what negotiations much you that's influenced XXXX? the So gains there you a getting you talked be on with by to just yield you do you the think about path can OR. you price? Or on XX think a to very think to are guys public. wanted point, discussions realize

Yes.

Okay, Ari.

XXX-plus into grow availability, back in in which We ran We're year, we're the plain. XX rough on is enter need and and We the a into velocity. changed. It network going and the We've normal ran we'll XXXX type. quarter, going step into the of of got So in anticipate essentially at into there to that. is strong then half third to we we to pretty be there the another normal really digging XXXX, car trouble hasn't case. and made be make quarter. out crew our progress I fourth path This point anticipate to the patch. I from the this

out to that, do cost for is, there we of excess As take sure, the opportunity an network.

that, Now having we're significant pretty against fighting said inflation.

price, inputs. anticipate not overcome we it and have will. with our on on you OR helpful We're see the PEB, right? to that's we side, services but board We're You that to will, to got going the somewhere. we confident across and the but create our in it's margin So

For going volume into the what us, future going At up that to year. point, doing to important the We're part be this volume. years. set this stool that's be three-legged got well industry exceed to We're incremental incremental is is the a more to of do.

year, I going we're And that a confidence margins think to what in improve our don't going yet again the that's gives next today, to terms going reiterating make have think of I industry us we're ratio. the and into it next hay with year. path that but able And it. to clear to going do we're to we XX That's leading to said margins. again, be operating

So Kenny?

real real-time the price. good date. we've just time, to to now that it sitting Yes. customers, reflect said as get with environment with our granular cover we're team, really rate a again, a mean, management commercial But little making adjustments to here, going inflation have discussions to I the to a job we're leaders done seeing inflationary

service fact the why light improving. adjustments that capital with the we're And that so especially sequentially our also need articulating in we're expending for those the the behind is then rates, and of

the Bank. of from Mehrotra Next question line is coming Amit with Deutsche

have to the understand lot 'XX, 'XX macro the Jennifer, agreement. there's understand of I just but wanted respect I from tentative with to to you and uncertainty, a walk

looks kind miles about headwind X, XXXX? on able you like a slide helpful It from bit just a it's It be something looks the I help just Kenny, to the in of to what on incremental XXX I rail. incremental So fuel still Is given mean, economics in a agreement year. then, tentative getting that is back. way day was talked obviously million least understand, like want to very to at little obviously headwind the should gap, the moving think so by day. us Lance about is -- per XXXX. of huge like car the right the And the on in where $XX There's

day XXX miles -- kind a about the you because low able near-term getting the in can to to where there XXX to we cycle step-up stuck If get economics start mid-XXX,XXX. to in get per if plus, volume to the to of trends, of better, volume, Like the is car get that you're or immediately we weekly this the term? today? move for asset As volume near times of think the it's more corresponding see kind are because we XXX-plus if

for Thanks Amit. Okay, that.

Let over. me start, we'll then it and turn

and So that for became the the you before quarter July increase wage referenced second quarter. effective first is was XX the X. That

remember to so is the the or the have July And X that wages accruals a the work increase. way thing is wage you it's

So effective July X.X% X, to think went was it I X% from a increase. we

second And to I it comments, $XX quarter. into referenced carry first impact, was And of goes so similar two wage third the quarter when year. inflation, Those next in million the then July impacts X% that's increase. a will impact fourth of and in amount my quarter XXXX, the

So that's that. think need how about you to

the increase to half in just sense? half, make inflation wage of increase X% that X% piece Does terms first relative So the second that. in

on then see it give net I Yes, another incremental next -- if number. kind mean, looks a year to third -- maybe I'm million $XX trying like fourth makes to but just it's can I'm doesn't versus it million you sense, like us wanted it's $XX incremental XXXX. lazy. quarter, of I quarter just see just it and I'm it a million I'm just if looks $XX to -- -- and -- like

call to and the another, X%. then going than it, million in the to something second little it's in a mean, that less I million Yes. bit half $XX first it $XX half of

you that's the think know inflation. right inflationary services about about pressures, that's purchase continues be thinking you're is it We wage that -- in way. contracted the particularly that category there labor. So labor But again, to when our

our will thought But to Analyst well have the don't now. above year, higher X.XX%. inflation certainly there's going know -- I quite inflation, was year ready PEB beyond wage for to what normal, than again, this We're don't be back we year. that but be much we'll inflation but inflation, of not at be So share May number, which full there that that than X% next it's that kind or our Day, which higher that.

there in a Yes, oh, yes. Kenny, about... there question was

Auto auto, where economy, demand are as out we vehicles. the Yes, weekly, looking you Amit, we're quite we're can improves, daily, there. monthly. parts I demand looking see velocity -- that's mentioned our area at I mentioned is carloads imagine, out at areas as a another there. and finished bit see But that rock, the coal. we we're there some of

And so yes, I capture term. think volume the for that more there's us to an near opportunity in still

of Our is Alliger next Jordan Sachs. line question Goldman from the with

Okay.

the line question Ben of be Our with next will from Nolan Stifel.

in maybe follow Yes. how there's that market you underserved about you're about areas of latter about -- at up the to for possible little pick Is the water the capacity up Is bit you be do it Actually, of question at the move barges you? to have part a Mississippi, can't quarter a that bit tailwind just in quarter could or just term for the the where around. on of specifically, make level a moment. there, little a And thinking immediate volume Amit's thinking fourth problems maybe in all? fourth it lot the that the the and we've could heard something that

working you, our tell been short with talking we've We've We've yes. team. with I'll is Yes. Eric's closely been The been to customers. working customers. answer

to will we incremental what know, this volume today. As you be have

But want that be But take. we're on to make you yes, some sure that, looking going I'm need a don't I to plan incremental it's at volume have capture a that us huge our barge with business. right we're reflect large But that we of say the customers. out to and that's hear go market with to now. that customers amount for kind is working of based rates be is that working product that we're to of misplaced a good again, that of to seems going Eric, amount to what volume. So

the heads That's to down go on then a and understand normal carload. the this, the down owners to Kenny, grain ship river. the to up going year those carloads the Gulf. going And way to What's river happen it river, our we in a of North the helping Yes. flow is is all

a for it's but carload, haul, we a and sure, now. right it's longer so And see showing demand up that

Oglenski question Our Barclays. Brandon from of comes next the with line

maybe proved resources the And higher OR, on OR the mention I Jennifer there. ROIC. but looking on right try they you we volume pretty guess, even at years, out the carriers I what's anymore? better out move turns? to get XX target focusing the sense be a you falters, XX for to out, something that's Lance, I it target elusive last and when here, Is mean, has most service put it did that of with more metric focusing couple mean, there. hindsight make just resources, as can't does in happened should asset

I So guess, the over you speak that term? can longer to

XX and a do the it Brandon, of but product achievable. that, reasons. Yes, We that's number sacrifices question, fair here's a service it. different is think think we for We about don't believe that how

on This hard. lot of about look crew just that backward wrong two pandemic distant pretty of real if a from early getting in there into last headwinds of and that unique us living us when the parts had made there's years, 'XX kind a you availability as on. because -- the a It's behind. it normal, resources we're year, of our impact one a that life number memory was us heading 'XX for but You we reasons, terms is them moving bit created in that know, now got as being of live first

that margins We way leading think just aside, about the think Day. absolutely a our our focusing ratio the said that operating Investor that. this setting to do about important is railroad think business. and number more long-term we being business right your fundamental at with spot we to on, incremental on talked is isn't can We We sustainable margin. merely Now question an

the year. we now what have reason up growth, whole us is, made then Day. for speak put that a And and quite Our we achievable We sets that's for franchise we that it lot right right? thought at why out The target to focused was year. happened of candidly, then And it stuff a was difficult. Investor this XX on fundamentally this to it

it, term of achieved is of business quarters. with other goal long thing is it to right? The in not to the once be set that to then it. is we've able done handle and it And is The couple think we handful be note nail that's the goal to a

out, Now that's to and of back on things believe More important could get grow. to next us change, right But progress, haven't our on us we're year. is And go track pointing make when and unachievable. continued we what Brandon. it now yet improving you're changed it's margins focused they into

there really Yes. think structure we to And marketplace be that efficient to terms competitive go to of us does what across his franchise. having That's about team -- cost that win. leverage competitive setting that the and solid in it, win And in and very out Kenny we new up the and for gives ability too, us. business very

point think I got we again, And XXX%. to out. this

of are We amongst top today, next the and that the terms best repeat our peers growth. heap to of going think at in performing we're year again I

RBC of Capital question Spracklin with next the is Markets. from line Walter The

I adjusting the some Just reported that it keeping you're OR, But in quarter, you taking know into mean, prior that's given for isn't XX that for on can on you're accounting period guidance. understand prior labor. And the OR I focus the putting I underline third of kind adjustments. period effect here. under

number So now. right? this number real that it's right reported Am is look that and I be nip it's this a to going for want know the at isn't the year to adjusted. -- shouldn't I I'm we bud not so for or Is XX year? XX to be the way Is should in the the that get -- to I know OR that and I number going It adjust. confusion, right shouldn't

what's that's $XX because it, No, includes, for I million. call on And slide wouldn't XXXX. and the agree shown appendix XXXX with OR XX that that

we that years were And under -- again, and that where it's is prior are this primarily so accrued. pertain really to those to -- that bonus dollars due

take under I were the whole we accrued. that while point, So to that's out, $XXX million maybe wouldn't your

need repeatable the think about thinking piece about that to when is you're OR. So you

about the keeping in next next we thing growth Is that's if other was giving year? you heard -- words, the for I XX. And efficiency see -- then next but year give for confident for say hear price, volume a heard macro. okay. next -- from that next you the I'm uncertainty confident achievable is about of of guide XX enough the for outlook didn't back year, what modest confident year, it. That the word just year lot. a OR I And to I about Okay. Got confident only given even not confident XX

is get from going we don't still we you communicate into the to No. were can big to go to really again, shape absolutely that heard is certainly was to Hopefully, we intending for longer. macro be something where $XX to together. how when a range That's a less environment not snapback dependent plan what pretty OR of see putting not have say high that can would us And out goal, million, where the that think but year. while But going there call but a the to than get that next a to range degree, XX, what on to in from we we're that that's road the into getting stretch able level is XX get and still that be We believe of kind be believe still is XX XX XXXX. that that to. it take a the us get we And we're can we up we you improvement. to we it

factor the to that's swing And volume.

those network You feel of and next Is all that enough resolved be constraining be year that, that issues confident that will won't significantly a factor. right? fluidity kind

Yes. incremental to next to a Running are kind going The of a inflation. like. Volume, operation year, constraint. constraints being exactly that's the that's it's railroad normal normally, a what lots mark of as question look not

you've got that right. So

lot basically and to that year back going to with squeezing a have is inflation of to find out normal we're to Next a incremental railroad efficiencies overcome.

of as I we have access contracts was going don't know, year. next to our the XXX% to reprice you just Yes, say,

up of as So a contracts of is some those bit they catch roll. some there on timing as we there

Our Vertical next with Jeff the of from question Kaufman Research is Partners. line

been the accrual not that on contracts, That yet ratified? Jen, an Or all this just million, labor a the quick represent have $XXX only to that point? outstanding including question. is ones that does for agreements ratified

for those both all that this of point for Thanks that the is and literally waiting table are the deals ratified because on that the It Yes. are are clarification. agreements, tentative and ratification. at

able what we that's to the So accrual to for. be know take

with question Susquehanna. of Bascome line Majors next from the The is

quarter July pretty Jennifer, the you the quarter for the when in the to union the that started trends, implied second you the year third look cost I and half for this employee at the X%, fourth increase close think of on wage X% per X.

per X% per actually Or below into you As kind for next maybe there we anything second kind increases do inflation decent that of on with year get cost to wage that you'll is of look can the feel in year? employee and the X% next the realized half, that? proxy that first is a half in continuing the head

be real that certainly, to and point. Those But less for where us because borrow-out that as overtime that Thanks referenced relative headwinds that will question. out. are look heard working employee cost overall in today, talk mean, I inefficiencies Yes. there's you end squeeze to we and the know something than to starting that's we out we're the to that costs. I structure our costs. would

we hard-to-hire have as a then to some eliminate to and these areas, in as well outs as be slim better. to hope be of working would While a we'll the that position manage ultimately certainly down probably while we're up that overtime borrow to able catch in for

the Stephens. line Long from is with question Justin next Our of

that you'll is from volumes to OR that comment growth? can do takeout bit on cost improving like still commentary, if you network Just as that are that XXXX down And clarify even a as the your OR still predicated that volumes be feel we Or volume XXXX, in you to flat even maybe able the around improve? or think are about assuming next year? inefficiencies the grow improve little you

large tailwinds Kenny Thanks Yes. have in good I piece and on, we Justin. no about some got terms of that Schneider being We've volumes. talked of both Lance for here you business. coming think I to given question, but today, as mean, again, numbers have

demand didn't have good year next on from construction know coal that into We our we demand a we today some market, the of we know move rock markets, standpoint. bulk going

to is expectation able So the at be Day. Investor our as we our back market to outperform said

the think could at industrial that look the put But even the And I for on of negative production in forecast a range. you positive so if now, outperforming are XXXX side ledger bit. us

year. now. So what not yet our going up we're that ultimately to quite on I'm setup fare really to But at ball degrees. economy depend we the that's about give that know obviously, how we're and year, is moment. thinking the shaping it's right My happens. good the things going exactly isn't that's going into do to like going to you how how And crystal next

with The the of next Wadewitz from line is UBS. Tom question

wanted to sensitivity. you bit I pricing a truckload about ask

you truck price. against given lot a generally to do with more a are there's market think can loose. recover -- truckload railroads time, the inflation But enough is market sense that looking where that I a

on it imports. do container to down a the market to the If accelerating intermodal? just kind reasonable of much think mean, really is think And to guess the that one UP intermodal? book that I how I just Do year. meaningfully, they're be seems still how barrier second So activity of terms be of -- is that you pricing? in sensitive next terms of of would much you price? truck import in can imports think your pretty you is grow tight and a link down import, Or your might

Yes.

So just again, two. just trying to differentiate the

the marks side, On there. more few you're question domestic a right, there's still

going bit about We'll stated a out a even I little bit are. into we're December. markets get find As our to where little earlier, in bids the here more

some As side I in to pricing. the of there supply out stated, there's firm out. constraint plays just the the up still that capacity that have could how that see enough on chain We are domestic

into I too the that volume, international increased fact highlighted make of coming to what there. rail really has I intermodal percentage with sure happening still actual the the is port. soon wanted to On of happen the the side, international it's what's will that volume tell regardless

we Today, more about are talked can fact that little larger Coast bit West a transloading our the that stand, we rail. So moving we of on we via customers see a again, now customers the our as percentage last year, had port. that of

that's positive So a for us.

to are play hard Yes, what how Tom, down certainly It to -- Kenny I mean, port in going is container volume part they're inbound to percentage does the on happens and be look like next markers sure we're exactly inland those on that's moving right? depending coming discern out. parts, our what of hearing enough But we the exactly early that. depends of going year. with see,

Right.

question Goldman line comes from Alliger with of Our the final Jordan Sachs.

to as just But question dealer to sector. could inventories think the what before. regardless Is we issues at technical fill lot happens just I quick some a mean, that the had there I on next need something will through auto outlook? to the from given deviate be year? economy, the consumer that to Sorry,

I markers the fact years wanted shippable, certainly to actually be. age haven't Average There's they OEMs demand out just have going we OEMs just very terms meaning is to rail so. pent-up And the much dealership think supply, car a talked of there it. improve semiconductor the lot the old. the part about lower yet. a Yes, that of are that's XX moved cars, in just point the again, and then chip, There the that, now of non-shippable, low, is I of than believe a to number of produced the via here. supply

And vehicle the very feel bullish in so that part based on finished side. we those on auto things,

This the Lance turn Fritz I'll to closing for call concludes over the now comments. question-and-answer session. back

talking your Until this to and with forward all Thank look fourth you discuss you, you please then, results. in our quarter us Rob, questions. and thank care. joining morning year take full for again to We for January and

participation. Ladies conclude does you thank teleconference. and your for gentlemen, today's This

lines, disconnect a day. your wonderful may You and have