Canadian Pacific Railway And Consolidated Fastfrate Sign Landmark 10-Year $400 Million Contract

December 5, 2001
Toronto, ON

The Canadian Pacific Railway (NYSE/TSE: CP) and Consolidated Fastfrate Inc. today announced the signing of a 10-year $400 million contract that will formally link the two transportation giants in a partnership designed to set a new industry standard for the movement of less-than-truckload (LTL) freight.

"The signing of this contract is a source of great pride and satisfaction for all members of the CPR family and not just because of its positive financial implications," said CPR President Robert J. Ritchie. "Since 1966 we have satisfied Consolidated Fastfrate's service and price needs to such an extent that it is partnering with us exclusively for the next decade."

CPR and Consolidated Fastfrate Inc. — Canada's largest privately owned LTL carrier — now offer combined rail and truck service for LTL freight throughout Canada, the United States and Mexico, using intermodal containers for the rail haul.

"Under this contract, we will give North American shippers a level of intermodal transportation with trains and trucks so closely linked that it will be hard to tell where one leaves off and the other begins," said Mr. Ritchie. "That's a breakthrough."

Consolidated Fastfrate Inc. will provide seamless LTL service for the CPR intermodal group, and CPR will be Consolidated Fastfrate's exclusive provider of rail-based intermodal service. The two companies expect the contract will lead to a twenty-five percent increase in the value of LTL transportation business for the railway, with solid prospects for further growth.

Shippers may now combine the long-haul efficiency of a railway and the speed and convenience of a dock-to-dock carrier with just a single call and waybill. Advanced information systems allow shippers to track their goods as they move seamlessly on both CPR trains and Consolidated Fastfrate Inc. trucks.

"This contract demonstrates that we have hitched our wagon firmly to the CPR's iron horse," said Consolidated Fastfrate president Ron Tepper. "CPR has invested in areas that are critical to meeting the performance shippers have come to expect from truck-based service.

"Because CPR has delivered that kind of service to us, we invested $40 million in new facilities inside or adjacent to the CPR's intermodal terminals across Canada. We are already planning additional services, facilities and support systems that will take this integrated rail-truck service to new levels. We fully expect that our business will grow," said Mr. Tepper.

"Our relationship has grown and expanded beyond just line haul business to the point where Consolidated Fastfrate performs local services for the railway, such as drayage and deconsolidation," said Mr. Ritchie. "The company even operates CPR's Thunder Bay intermodal terminal on our behalf. Together, we're more than just the sum of two parts. At CPR, we can't think of a better definition of partnership."

Calgary-based Canadian Pacific Railway (CPR) is North America's first transcontinental railway and the only one today with direct service to the U.S. Eastern Seaboard. Its 22,500 kilometre (14,000 mile) network serves the principal centres of Canada, from Montreal to Vancouver, as well as the U.S. Midwest and Northeast. Alliances with Consolidated Fastfrate, other railways and trucking companies extend the CPR's reach into Mexico and throughout North America, and via the highway and road systems — into Canada's full-trailerload and small-shipment truck markets.

This news release contains forward-looking information about CPR. Actual future results may differ materially. The risks, uncertainties and other factors that could influence actual results are described in CPR's annual report and annual information form.

Toronto-based Consolidated Fastfrate Inc. is Canada's largest privately owned freight forwarder. The company annually transports in excess of 2.64 million metric tons (1.2 billion pounds) of freight and employs more than 1,200 people in 16 offices and facilities across North America. Through recent expansion and strategic acquisitions, Consolidated Fastfrate Inc. now offers service throughout Canada, the U.S. and Mexico.

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