Union Pacific

1. 1© Transplace 2014.
#TPSS2014
Innovative Solutions for the
Mexican Market
Bernardo Ayala, Union Pacific Railroad

2. 2
Mexico’s Fast Growing Rail Industry
Union Pacific Railroad
Bernardo Ayala – Vice President Mexico Markets May 13, 2014

3. 3
Mexico’s Steel Wheel* Freight Volumes
-
100
200
300
400
500
600
700
2006 2007 2008 2009 2010 2011 2012 2013
* Does not include traffic terminating or originating at the border.
Thousand Units
Cross Border Steel Wheel Freight
between Mex – U.S.
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
1995 1998 2001 2004 2007 2010
Total Cross Border Steel Wheel Freight
between Mex– U.S.
Thousand Tons
Source: Union Pacific Internal DataSource: 2012 Annual Railroad Statistic Handbook,
Secretary of Communications and Transport

4. 4
Supporting Growth in Mexico
UP Border Investments
*Excludes Santa Teresa and Sunset corridor spend
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Border-Area Subdivisions
($Millions)
Maintanence Capacity
$53
$22
$29
$44
$30 $28
$14
$32
$24
$81
• Mexico traffic growth has
helped drive capital
investments of $357 Million
2004 – 2013 in the border
area to support our NB/SB
volumes with Mexico*
• Some important projects
near the border include:
– Double track along Sunset
corridor
– Santa Teresa Facility
– Siding and wye connection at
Eagle Pass
Eagle Pass South Slot – Looking South
Horan Siding

5. 5
Hermosillo
Chihuahua
Monclova
Torreón
Saltillo
Monterrey
Culiacan
San
Luis
Potosí
Tampico
Querétaro
Veracruz
Coatzacoalcos
Puebla
Salina
Cruz
Aguascalientes
Guadalajara
Manzanillo
Lázaro Cárdenas
Mexico
City
Mérida
Brownsville
Nogales
Laredo
Eagle Pass
Calexico
El Paso
UP Positioned for Mexico Growth Opportunities
$2.1 billion in 2013
Exports to Mexico
56%
Imports to U.S.
44%
FXE 49%
KCSM 51%
Agriculture,
12%
Autos, 47%
Coal, 1%
Chemicals,
6%
Industrial,
11%
Intermodal,
23%
Mexico Commodity Mix
Ferromex (FXE)
KCSM
Ferrosur (FSRR)
Short lines
• Mexico connectivity
• Growing Population
• Mexico’s Macro Drivers
– Proximity to U.S.
– Production costs
– Skilled labor pool

6. 6
UP’s Presence in Mexico
Service Beyond the Border*
Sources: Mexico’s Ministry of Economy, Maquila Portal, Banco de México
Topolobampo
Guaymas
Mazatlan
Manzanillo
Tampico
UP Gateways/Offices
Announced Customer
Investments
Carload:
Shipments that move only on
rail. Origin and destination are
rail served.
Intermodal:
Rail-truck delivery to and from
Mexico for shipments moving
in containers.
Transload:
Integrated, multi-modal truck-
rail combination. It involves
freight that either originates
and terminates in multiple
trucks, and on the opposite
end of the move, is transported
in a single rail car
Bajio
*Service in Mexico is provided through Mexican interchange rail carriers and is not
..directly via UP trains or crews

7. 7
Tucson
El Paso
Laredo
Hermosillo
Chihuahua
Saltillo
Monterrey
San
Luis
Potosí
Querétaro
Puebla
Aguascalientes
Guadalajara
Mexico City
Torreón
Superior Intermodal Market Coverage
UP Serves 19 Mexico Markets in Conjunction w/MX Railroads
Nogales
Celaya
Leon
Toluca
Juarez
Union Pacific’s Mexico Products Connect to 47 Markets in the United States and Canada,
served with our equipment programs with EMP, UMAX, and rail-owned containers
Border Direct:
UP rail service to the US
border
Streamline Passport:
Rail-truck delivery to and
from Mexico provided by
Streamline, a wholly-owned
UP subsidiary
Mexico Direct*:
UP/Mexican rail to a
Mexican rail ramp
Rio Valley
Reynosa
FXE Railroad
Border Direct
Passport Only
Transborder &
Passport
*Service in Mexico is provided through Mexican interchange rail carriers and is not
..directly via UP trains or crews

8. 8
Railroads
2%
Maritime
2%Air, 7.2%Light Vehicles
63%
Other, 4%
Why Ship Rail?
Advantages of Rail vs. Truck
• Lower environmental impact
– Rail is four times more fuel efficient than truck
– Union Pacific can move one ton of freight 470 miles on
a single gallon of diesel fuel
– Since 1980, volume on America's rails has nearly
doubled, but fuel usage has remained relatively flat
• Helps decongest border crossings and
roads
– A rail car can carry up to 4 truckloads
– One train can take up to 300 trucks off the road
• Lower employee injury rates
• Infrastructure maintenance and
construction is not a burden on taxpayers
• Expedited border clearance
Sources: Environmental Protection Agency (EPA), AAR
Green House Emissions
Percentage of Tons Transported in the
U.S. by Transportation Mode
Railroads
40%
Trucks
30%
Maritime
11%
Air
0.3%
Trucks
22%

9. 9
• Union Pacific is a leading
provider of transportation
services to and from Mexico as
well as the border area
• Strong interline relationships
with Mexican carriers and key
government agencies
• Only railroad to serve all six
gateways
• Comprehensive transportation
options
• Excellent customer service
• Supporting future growth
The Value of UP in Mexico
Key Elements
Seamless
Cross-Border
Service
Strategic
Investments
Transportation
Solutions
Interline
Relationship
U.S./Mexico
Relationship