Patrick J. Ottensmeyer, President and CEO, Kansas City Southern

https://www.kcsouthern.com
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Patrick Ottensmeyer

In the US, consumer spending is strong and industrial production in many segments is healthy. In Mexico, it is encouraging that the US has reached a trilateral agreement with Mexico and Canada in the renegotiation of NAFTA under the new United States-Mexico-Canada Agreement (USMCA).

North America is a globally competitive, integrated supply chain. The USMCA continues recognition of this important economic reality by supporting mutually beneficial trade and robust economic growth in North America. We look forward to congressional review of this new agreement to provide certainty for additional investment in Mexico and commerce across the North American continent.

In 2019, we expect to see volume growth accelerate, led by a few key opportunities, including refined products exports to Mexico. This is driven by strong demand for refined products in Mexico and additional storage tank infrastructure. The storage tank infrastructure is key to ensuring our rail network can meet this growing demand while maintaining efficient and fluid operations across our cross-border and northern Mexico corridors.

We are also watching a few things closely. Free and efficient trade supports continued economic expansion. While we have not seen a significant impact from ongoing trade negotiations, we are mindful of the importance of international trade to strong US and Mexican economies. We will monitor these developments, and continue to voice support for trade expansion.

Technology and innovation are playing an increasingly important role in our industry. We achieved full positive train control implementation on the required sections of our US network. In 2019, we will work with our rail partners to advance interoperability. We are dedicating resources to promoting the application of technology across our network. From the use of drones to monitor and secure our network to applying artificial intelligence to decision-making, we are excited about how technology can optimize network performance.