US Tariffs Hit CN & CPKC: $550M+ Revenue Loss, CUSMA Looms

US tariffs cost CPKC and CN over $550M in 2025, yet CPKC invests $800M in US locomotives, highlighting trade policy’s impact on rail.

US Tariffs Hit CN & CPKC: $550M+ Revenue Loss, CUSMA Looms
February 2, 2026 3:39 pm
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🛑 Key Takeaways:
  • US trade tariffs cost Canadian railways CN and CPKC a combined total exceeding USD 550 million in 2025 revenue.
  • CPKC is proceeding with an USD 800 million investment in new US-built locomotives and issued a $0.228/share dividend, signaling confidence despite policy risks.
  • Market stability hinges on the upcoming CUSMA trade agreement renegotiation in July, which introduces significant uncertainty for all North American freight carriers.

CALGARY, AB – US trade tariffs implemented in 2025 have directly impacted the revenues of Canada’s leading freight rail operators, with Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC) reporting combined losses of over USD 550 million. CN management attributed a revenue reduction of more than USD 350 million to the tariffs and trade volatility. CPKC’s CEO estimated a similar impact of approximately USD 200 million. Despite the financial headwinds, CPKC is demonstrating long-term commitment to the US market, continuing an over USD 800 million investment in new American-made locomotives and announcing a quarterly dividend of $0.228 per share.

CategorySpecification / Detail
Financial Impact (2025)>$550M combined revenue loss for CN & CPKC
Operator BreakdownCN: >$350M loss; CPKC: ~$200M loss
Key StakeholdersCanadian National (CN), Canadian Pacific Kansas City (CPKC), US Administration
CPKC US Investment>$800M for new locomotive fleet
CPKC SuppliersWabtec (Fort Worth, TX), Progress Rail/EMD (Muncie, IN)
Upcoming Policy EventCUSMA trade agreement renegotiation (July 2026)

Operational & Technical Details

CPKC’s investment underscores its deep integration with US manufacturing. The company is acquiring 70 Wabtec Evolution Series ET44AC Tier 4 locomotives, with initial deliveries expected in January 2026. An additional 30 EMD SD70ACe-T4 Tier 4 freight locomotives from Progress Rail are scheduled for delivery in the second half of 2026. This fleet renewal is a significant capital expenditure, signaling a strategic focus on efficiency and capacity within its cross-border network despite the unstable trade policy environment.

Market Impact Analysis

The tariff-induced losses highlight the rail sector’s acute vulnerability to political friction between the US and Canada. Both CN and CPKC operate extensive, deeply integrated networks across the border. While management at both firms insists core trade flows will continue, the unpredictability introduced by the Trump administration’s policies creates significant operational and financial planning challenges. CPKC’s strategic position as the only railway with a continuous network linking Canada, the US, and Mexico—a result of its USD 31 billion acquisition of Kansas City Southern—makes it uniquely exposed to, yet potentially a beneficiary of, North American trade dynamics. The upcoming CUSMA renegotiation is now the primary focus for the industry, as its outcome will define the commercial framework for North American rail freight for years to come.

📅 Originally Published: December 2025
To understand the background of this fare adjustment, let’s revisit a previous announcement.

➤ Read More: London: TfL Confirms 2026 Fare Rises, Capped at 20p


FAQ: Quick Facts

What was the financial impact of the 2025 US tariffs on Canadian rail?

The tariffs caused over USD 550 million in combined revenue losses for Canadian National (CN) and Canadian Pacific Kansas City (CPKC).

What is the next key event for North American rail freight?

The renegotiation of the CUSMA (Canada-United States-Mexico Agreement) trade deal, scheduled for July 2026, is the next major event creating uncertainty for the sector.