BNSF to expand mileage-based fuel surcharge program

[Zeb]

By Progressive Railroading

BNSF Railway Co. is expanding a mileage-based fuel surcharge program, which was launched in 2006 initially for unit coal train and agricultural product shipments.

Beginning Jan. 15, 2009, the program will be extended to carload customers (in the automotive, coal, and agricultural and industrial products sectors) who do not currently pay a mileage-based fuel surcharge. In addition, intermodal customers who don't pay a mileage-based surcharge will be extended into the program beginning Feb. 18, 2009. The changes for carload customers will be phased in as current pricing authorities expire, BNSF said.

The mileage-based fuel surcharge program is designed to provide a more direct and accurate method of reflecting the impacts of rising fuel costs on BNSF and shippers. The Highway Diesel Fuel price BNSF uses to assess a fuel surcharge on carload shipments will increase from $1.25 per gallon to $2.50 per gallon, and pricing for carload shipments subject to a mileage-based fuel surcharge will be adjusted to reflect the new price, the Class I said.

"As the first railroad to establish a mileage-based fuel surcharge program, BNSF is further developing the program based on our continual monitoring of fuel prices, fuel efficiency efforts and input from our customers," said John Lanigan, BNSF's executive vice president and chief marketing officer, in a prepared statement.