Lonny Kubas Director Marketing 20th Annual Freight & Logistics Symposium Intermodal International Center for Transportation Studies Investing in Capacity to Support Service and Growth December 1, 2017 Confidential, proprietary and sensitive information This presentation and any associated file (together "Contents") are intended solely for the participants of this meeting. The Customer shall hold all the information disclosed during this meeting in confidence and shall not disclose, sell, trade, exploit or publish or permit to be disclosed, or sold to, or traded and/or exploited by any Person without CN’s prior written consent. Ennishore Bridge, NB Year of Changes

• New Alliances

o Realignment of calls and increased discharge

• Two significant West coast port terminal expansions

• Very strong North American economy

• Increased industry demand for empty equipment

• Tight global supply of containers

CN is Focused on Quickly Changing Markets & Operations 2 Creating Value Throughout The Entire Supply Chain

Prince Rupert

Prince George

Edmonton Calgary

Saskatoon Moncton Vancouver

Winnipeg Halifax Saint John Montreal Duluth Business Segment Chippewa Falls Intermodal 23% Arcadia Toronto Petroleum and Chemicals 19% Grain and Fertilizers 16% Joliet Cleveland Columbus Forest Products 14% Decatur Indianapolis Metals and Minerals 11% Cincinnati Automotive 6% Louisville CN Intermodal terminals Other Revenues 6% CN-served CN-served destinations Coal 5% NS Interchange Memphis * 2016 Revenues Diversified Portfolio Jackson Creates Matchback New Orleans Mobile 3 Investing to Support Safety Network fluidity & Productivity

Capital Expenditures ($ millions) Positive Train Control (PTC) Equipment Productivity initiatives, including IT

Core network investments ~C$20B Capital Investments over the last 10 years

2010 2011 2012 2013 2014 2015 2016 2017

Direct Intermodal $ Spending

16%

Containers 43%

Terminal Equipment

Terminal Development 41%

Continuing to Invest for Tomorrow’s Service 4 Network Improvements Capital Expenses (C$ Million)

TAVERNA-PRINCE RUPERT New sidings and siding extensions Additional Yard Capacity Investments: Prior Years 2018 2018 2019 2020 1 Scotford by-pass track - $6.5 2 Rainier Yard extension $4.0 $8.0 $25.0 $24.0 $56.0 3 Blair Yard Phase 2 – Stage III - $5.4 4 Swan Landing yard $1.8 $2.1 Prince 5 Walker yard - $1.0 Rupert

Edmonton 4 5 1 Taverna

Vancouver WINNIPEG-CHICAGO Winnipeg Double tracks + New sidings + Siding extensions

VANCOUVER-EDMONTON EDMONTON-WINNIPEG 2 2018 2019 2020 Double Tracks & siding extensions Double Tracks $84.6 $81.0 $152 2018 2019 2020 2018 2019 2020 3 $54.0 $60.1 $49.0 $84.6 $81.0 $152

Chicago

2018 – An Estimated $300M in Capacity Enhancements 5 2012-2017 US Imports/Exports

Imports via East Coast Exports via East Coast 60,000 60000 50000 50,000 CAGR: 9.5% CAGR: 12.7% 40,000 40000

Units 30000 Units 30,000 20,000 20000 10000 10,000 0 0 2012 2013 2014 2015 2016 2017 2012 2013 2014 2015 2016 2017 YEO YEO

Imports via West Coast Exports via West Coast 400,000 320,000 CAGR: 21.1% 320,000 CAGR: 9.9% 240,000

240,000 Units Units 160,000 160,000

80,000 80,000

0 0 2012 2013 2014 2015 2016 2017 2012 2013 2014 2015 2016 2017 YEO YEO

Significant Growth in US Imports & Exports Via Both Coasts 6 CN Innovates with “New & Improved” Central Examination Station (CES) in Ranier, MN

• $10 M investment on infrastructure over the last 10 years

• CN has built 2 pads each with a dedicated crane to lift exam containers from live trains (Live Lift)

• Dedicated tractors and chassis to make containers available for inspection

• CN continues to evolve the unique and highly efficient CBP inspection process at Ranier through expansion of our examination facility • CN will be developing in conjunction with CBP a fully certified Centralized Examination Station (CES) for the port of International Falls MN (Ranier)

• Operational March 2018 • New refrigerated cargo inspection area to be built • Will further streamline the US inspection process and reduce operational delays

• CN’s new CES will provide a full range of inspection services similar to those found at the ports of Seattle and Long Beach, including fumigation

No Other Facility Like This in 7 Duluth Catchment Area

Ports of Prince Rupert & Vancouver Duluth Ports of Montreal & Halifax

Chippewa Falls (146 Miles) Arcadia (196 Miles) Import Customers Export Customers

Ports of New Orleans & Mobile 8 Access via 3 Coasts in North America

Transit Time - Imports Critical Mass Start up Origin Destination Transit Time Transit Time Prince Rupert Duluth 7th Day AM 10th Day AM Port of Prince Rupert Duluth 7th Day AM 9th Day AM Vancouver Port of Duluth 5th Day PM 6th Day PM Montreal

th th Duluth 7 Day PM 8 Day PM Montreal Port of New Duluth 5th Day PM 6th Day PM Orleans Vancouver Port of Mobile Duluth 7th Day PM 8th Day PM Halifax DULUTH Transit Time - Exports Critical Mass Start up Origin Destination Transit Time Transit Time Duluth Prince Rupert 7th Day AM 10th Day AM Mobile Port of Duluth 8th Day AM 10th Day AM Vancouver New Orleans Port of Duluth 5th Day PM 6th Day PM Montreal Duluth Port of Halifax 7th Day PM 8th Day PM

Port of New th th Duluth Orleans 5 Day PM 6 Day PM Duluth Port of Mobile 7th Day PM 8th Day PM 9 Duluth Terminal - Value Added Services

3PL Warehousing and Transload Services o Ag & industrial transload capabilities o 400,000+ square feet of warehouse space plus 40+ acres of secure outdoor storage o Heated storage available o Tier II Warehouse Management Software o Scanning, RFID, and EDI capabilities with customer portal o Forklift capacity up to 55,000 lbs o Indoor overhead cranes for open-top container loading o Heat treated dunnage certification o Customized skid and crate fabrication o Certified public truck scale for SOLAS weight compliance o Additional rail capacity for carload cargo transfer to/from containers o Customizable solutions to fulfill additional customer needs

Immediate Transload and Warehousing Capability 10 New Duluth Intermodal Terminal Terminal Hours and Days of Service Terminal Details • Monday to Friday 07:00 to 18:00 • 7.5 total acres for ramp operations • Saturday 08:00 to 12:00 • 1 Reach stacker • 2 x 81 metric ton gantry cranes Terminal Address • Annual throughput capacity of 45,000 TEUs 1310 Port Terminal Drive • Freetime = 48 hours Duluth, MN 55802 • Transload service capability • Foreign Trade Zone designated (FTZ #51) Terminal Operations Contact • Local USCBP and Ag Inspectors • CY Storage capacity of 1,500 TEUs Brian Granholm • 3rd party chassis pool on-site Manager – Warehousing & Logistics • Reefer plugs available upon request [email protected] • Congestion free highway access to I35 & (218) 727-6646 (Office) Highways 2, 23, 53, 61 & 210 (218) 727-6646 (Fax)

Winnipeg

Duluth

Detroit Chicago 11 We Match Exporters to Ocean Lines

Prince Rupert

Edmonton Prince George

Saskatoon Calgary Winnipeg Moncton Vancouver Halifax Saint John Duluth, MN Chippewa Montreal Falls Toronto Arcadia

Chicago Detroit

Joliet

Indianapolis Decatur

Very Important Memphis To Overall Inland Economics Jackson 12 New Orleans Mobile Diversified Gateway Growth

1,000,000 Port of Prince Rupert 1,800,000 1,600,000 Container *Volume (TEUs) Container *Volume (TEUs) 800,000 1,400,000 1,200,000 600,000 1,000,000 800,000 400,000 600,000

200,000 400,000 200,000

0 0 2011 2012 2013 2014 2015 2016 2017 2011 2012 2013 2014 2015 2016 2017

450,000 350,000 Port of Halifax 400,000 Container *Volume (TEUs) 300,000 Container *Volume (TEUs) 350,000 250,000 300,000 250,000 200,000

200,000 150,000 150,000 100,000 100,000 50,000 50,000 0 0 2011 2012 2013 2014 2015 2016 2017 2011 2012 2013 2014 2015 2016 2017

CN Has Invested in Inland Capacity to Support Gateway Growth * Loaded and empties 13 Summary

• Investing for growth • Extended CN’s reach through our 3 coasts • Supporting market growth through investments in new inland terminals • Providing innovative cross-border supply chain solutions

Supply Chain Focused

14