June 19, 2008

Letter from Jack Koraleski

To our Customers:

As flood waters recede in some of the most heavily impacted areas along the UP system, I want to provide a brief update on the condition of our network and our efforts to restore service. 

Effective today, we are canceling the embargoes we had in place for traffic moving across parts of our east-west main line.  The whole nation has seen the flood impact in Cedar Rapids and those flood waters made our main line double track impassable in that area.  That outage last week made it necessary to put the embargoes in place.  With the drop in water levels, our crews were able to replace ballast and make enough repairs to re-open one main track yesterday - allowing for limited operation.  With further work by the Operating team, the second main track opened this morning and the embargoes are no longer necessary, although operations remain limited.

As highlighted through our web updates over the past several days, while our network was hardest hit in the Cedar Rapids area, flood conditions resulted in intermittent outages on several other subdivisions across the Midwest.  Those included the north-south spine line between Kansas City and Des Moines, our River Subdivision between Kansas City and St. Louis, and our Adams Subdivision between Chicago and Minneapolis.  As water levels receded in those areas, our engineering crews began working around the clock to make repairs and restore service.

Although the major embargoes have been lifted, an embargo on traffic to and from Cedar Rapids proper is in place.  Across the Midwest, repair work will continue and it will be awhile before operations are fully restored to normal.  We anticipate continued slow orders throughout the area over the coming weeks to allow for repairs to our track, yards and signal systems.   Additionally, as customers assess their own damages and rail access to their facilities, local embargoes may be put in place while needed repairs are made.  For embargo information, please visit our Web site.

The good news is that the railroad was in great shape prior to the flooding, with May's service metrics at their highest levels in five years.  This momentum certainly helps in our efforts to restore service.

Thank you for your patience and cooperation as we work to restore service.  We will continue to post updates on our web site as new information becomes available.